Tom O'Brien
Since 1990, World Bank assistance has helped Bulgaria foster sustainable economic growth by accelerating the structural reform and rapid development of the private sector.
It has also helped address poverty through improvements to the social safety net and other social sector programs.
The total amount of money the WB has invested in Bulgaria, in the implementation of 24 projects, is $1.45 billion. This includes nine adjustment loans ($850.8 million), 14 investment operations ($594.4 million), and a WB-managed Global Environment Fund grant ($9.9 million).
The bank has focused on working with the government and other agencies towards promoting economic growth, said Thomas O’Brien, resident representative of the World Bank in Bulgaria. This will lead to an improvement in the living standards for all Bulgarians, especially the poorest. The WB offers both advice and financial assistance, he said.
At the end of March, O’Brien and Bulgarian Finance Minister Muravei Radev signed an agreement for a $306,000 financing grant for Bulgaria, with resources provided by the government of Japan. This grant will help provide much needed assistance for detailed technical analysis to help build a new Unified Revenue Agency. So far the country’s revenue collection responsibilities are divided between the General Tax Administration Department (GTAD) and the National Social Security Institute (NSSI).
“A well-functioning economy must have a good tax system, which collects revenue efficiently, and treats taxpayers properly,” explained O’Brien, upon signing the agreement.
Bulgaria has improved its tax administration, and creating a unified revenue agency is an important step towards modernising the public sector, and reducing compliance costs on taxpayers. The World Bank, with the help of the government of Japan, has been happy to support this effort, he added.
If the URA concept works effectively, the collection of taxes and social security contributions from the population would be streamlined. The legal status of the URA has to be reviewed, he said, because at the moment the GTAD and the NSSI have different reporting arrangements and legal status.
In its 2000 annual report on Bulgaria, the World Bank said that most tariff and non-tariff restrictions restricting trade were lifted during the 1997-2000 period. However, certain representatives of the trade and agricultural sectors, as well as other experts, demand introduction of protective duties in support of various troubled productions and of agricultural products.
“You have to be careful to have no policies such as non-tariff restrictions and imposing duties,” said O’Brien. “In Bulgaria’s case, we believe that a lot is already done to liberalise the trade regime, and the regime compared to many other countries is actually in a good shape.”
Imposing duties to protect local production doesn’t work over short and long-term periods, he added, because the consumers and households will have to pay more for the goods and services.
In terms of privatisation, O’Brien explained that the main benefit of the process was new investment from strategic investors, as well as management, experience, and technology. That helps companies work more effectively, and makes the market more efficient. He said this, in turn, helps the Bulgarian commerce and industry to become more competitive. “This is, in fact, one of the ingredients in advancing to EU membership.”
Bulgaria should urgently complete its privatisation program, including the sale of banks, he said. However, some experts claim it is better to wait until further accession to the EU, before urging the sale of the last state-owned companies, in order to achieve a higher price for them. “I don’t think you have to wait for EU accession,” said O’Brien. “I think this will only help to move forward to EU accession.”
The WB is developing a new programme it calls “Country Assistance Strategy.” The strategy would guide the work of the bank and detail how it would assist Bulgaria over the next three years. It is under discussion right now and in a few weeks the WB will ask experts and representatives of business and administration to give their opinion on the matter. Then, when the basic concepts are ready, the WB will discuss them with the country’s new administration, after the June 17 elections.
The WB currently has 12 pro- jects under implementation in Bulgaria, in such fields as energy and water supply, railways, health, social and environmental sectors. The bank also has several projects under preparation, including a Child Welfare Program.
It has also helped address poverty through improvements to the social safety net and other social sector programs.
The total amount of money the WB has invested in Bulgaria, in the implementation of 24 projects, is $1.45 billion. This includes nine adjustment loans ($850.8 million), 14 investment operations ($594.4 million), and a WB-managed Global Environment Fund grant ($9.9 million).
The bank has focused on working with the government and other agencies towards promoting economic growth, said Thomas O’Brien, resident representative of the World Bank in Bulgaria. This will lead to an improvement in the living standards for all Bulgarians, especially the poorest. The WB offers both advice and financial assistance, he said.
At the end of March, O’Brien and Bulgarian Finance Minister Muravei Radev signed an agreement for a $306,000 financing grant for Bulgaria, with resources provided by the government of Japan. This grant will help provide much needed assistance for detailed technical analysis to help build a new Unified Revenue Agency. So far the country’s revenue collection responsibilities are divided between the General Tax Administration Department (GTAD) and the National Social Security Institute (NSSI).
“A well-functioning economy must have a good tax system, which collects revenue efficiently, and treats taxpayers properly,” explained O’Brien, upon signing the agreement.
Bulgaria has improved its tax administration, and creating a unified revenue agency is an important step towards modernising the public sector, and reducing compliance costs on taxpayers. The World Bank, with the help of the government of Japan, has been happy to support this effort, he added.
If the URA concept works effectively, the collection of taxes and social security contributions from the population would be streamlined. The legal status of the URA has to be reviewed, he said, because at the moment the GTAD and the NSSI have different reporting arrangements and legal status.
In its 2000 annual report on Bulgaria, the World Bank said that most tariff and non-tariff restrictions restricting trade were lifted during the 1997-2000 period. However, certain representatives of the trade and agricultural sectors, as well as other experts, demand introduction of protective duties in support of various troubled productions and of agricultural products.
“You have to be careful to have no policies such as non-tariff restrictions and imposing duties,” said O’Brien. “In Bulgaria’s case, we believe that a lot is already done to liberalise the trade regime, and the regime compared to many other countries is actually in a good shape.”
Imposing duties to protect local production doesn’t work over short and long-term periods, he added, because the consumers and households will have to pay more for the goods and services.
In terms of privatisation, O’Brien explained that the main benefit of the process was new investment from strategic investors, as well as management, experience, and technology. That helps companies work more effectively, and makes the market more efficient. He said this, in turn, helps the Bulgarian commerce and industry to become more competitive. “This is, in fact, one of the ingredients in advancing to EU membership.”
Bulgaria should urgently complete its privatisation program, including the sale of banks, he said. However, some experts claim it is better to wait until further accession to the EU, before urging the sale of the last state-owned companies, in order to achieve a higher price for them. “I don’t think you have to wait for EU accession,” said O’Brien. “I think this will only help to move forward to EU accession.”
The WB is developing a new programme it calls “Country Assistance Strategy.” The strategy would guide the work of the bank and detail how it would assist Bulgaria over the next three years. It is under discussion right now and in a few weeks the WB will ask experts and representatives of business and administration to give their opinion on the matter. Then, when the basic concepts are ready, the WB will discuss them with the country’s new administration, after the June 17 elections.
The WB currently has 12 pro- jects under implementation in Bulgaria, in such fields as energy and water supply, railways, health, social and environmental sectors. The bank also has several projects under preparation, including a Child Welfare Program.
