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Press release:
Further consolidation of reforms would enhance benefits
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This Trade Policy Review has allowed us all to understand and better
appreciate the trade policies and practices of Bulgaria. Our dialogue
has been thorough, positive and comprehensive, stimulated by the full
and open engagement of the high-level Bulgarian delegation, led by
Deputy Minister Radoslav Bozadzhiev.
Members praised Bulgaria for the significant macroeconomic and
structural reforms implemented since its economic crisis in 1996.
Membership of the WTO and the objective of accession to the EU had
contributed to the process. Reforms implemented included trade and
investment liberalization, privatization, and introduction of new
legislation on bankruptcy and competition policy as well as in other
trade-related fields. These had contributed to high rates of economic
growth in the past five years. However, problems of widespread poverty
and high levels of unemployment and the proportion of economic
activity in the grey economy, remained to be tackled, although there
were recent signs of improvement in social indicators. Members
encouraged Bulgaria to continue consolidating its reforms.
Bulgaria's active participation in the multilateral trading system
since its WTO accession in 1996 was acknowledged. All tariff lines
were bound and average applied MFN rates had fallen from 17.6% in 1997
to 11.2% in 2003. Bulgaria had also undertaken GATS commitments with
wide coverage of sectors and modes of supply. Furthermore, autonomous
liberalization in goods and services had gone beyond Bulgaria's WTO
commitments. However, some Members, observing that there remained a
considerable margin between bound and applied tariff rates, stated
that reduction of this margin would enhance the predictability of the
tariff regime. Some Members also noted that there still remained high
tariffs on particular products.
Regional trade liberalization, including the objective of EU
membership, had contributed to Bulgaria's economic development. Some
Members were of the view that, given Bulgaria's level of development
and the significant levels of tariff liberalization already
undertaken, it was inappropriate for Bulgaria to further reduce its
applied MFN tariff rates. Others encouraged Bulgaria to reduce the gap
between MFN and preferential rates in order to optimize net trade
creation effects.
Bulgaria's legislative reforms in customs administration, contingency
trade measures, government procurement, SPS and technical
requirements, and intellectual property rights were commended. Issues
were raised regarding the need for effective implementation and
enforcement of these reforms.
On sectoral matters, the restoration of farm land to previous owners
was commended, however the resulting structure of partitioned, small
farms, and the lack of adequate complementary capital for investment,
were seen as hindering the development of the sector and the reduction
of poverty. Continuation of privatization reforms in energy and
services areas was also encouraged.
Clarification was also sought by Members on the following issues:
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progress under the judiciary reform programme;
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tariff quota utilization;
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customs and trade facilitation provisions;
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internal taxation provisions;
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implementation of trade remedies;
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Government procurement procedures;
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foreign direct investment procedures and guidelines;
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regulatory measures for biotechnology products;
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energy price liberalization and State aids to the energy sector;
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a variety of intellectual property issues, including enforcement
questions;
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trade in unbound services and the current round of negotiations;
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issues in the services sector, particularly financial and
telecommunication services
Members expressed their appreciation for the oral and written
responses provided by the Bulgarian delegation to these issues.
In conclusion, I believe that the Trade Policy Review Body is highly
appreciative of the reform efforts undertaken by Bulgaria and their
positive effects to date. I hope that Bulgaria has found the trade
policy review process a positive exercise. Bulgaria participates
actively in the Doha Development Agenda and Members encourage it to
continue working constructively in the multilateral trading system.
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