Bulgarian Business Associations 'Mull State Lockout' over KTB

Business | July 22, 2014, Tuesday // 11:39| Views: 1253 | Comments: 0
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Bulgaria: Bulgarian Business Associations 'Mull State Lockout' over KTB Photo by Hristina Dimitrova

Two major associations representing employers and the industry sector could announce the first lock-out in Bulgaria's history, a Bulgarian daily reports.

The Confederation of Employers and Industrialists in Bulgaria (CEIBG) and the Bulgarian Industrial Association (BIA), are considering a halt of activities at the tens of thousands of enterprises they represent for an hour.

A lockout would see electricity, communications and transport services severely disrupted or even completely blocked, though this has been reportedly discussed only as a "radical" scenario.

They could threaten to take the step if the government adopts legal amendments allowing the state to guarantee deposits over EUR 100 000 in case of a bank failure.

A move to change the threshold has been on the table since the events at the Corporate Commercial Bank (KTB), which the central bank BNB announced was to be declared insolvent, with its subsidiary Credit Agricole Bulgaria being taken over by the state.

Neither BIA nor CEIBG have commented on the information of website Dnevnik.bg, which cites sources close to the talks between the two organizations.

The unions are due to announce their official intentions on Tuesday or Wednesday.

Proposals to cover deposits going beyond EUR 100 000 have had a controversial reception, with many refusing to back the idea to save larger asset holders using taxpayers' money.

Ruling Bulgarian Socialist Party (BSP) has thrown its support behind a draft bill including changes in that direction, but the opposition GERB has announced it is ready to reject it.

Being the two largest employers' organizations in Bulgaria, BIA and CEIBG claim to represent companies generating between two-thirds and three-quarters of Bulgaria's GDP and also to account for about a million employees.

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Tags: BIA, CEIBG, lock-out, Corporate Commercial Bank, KTB, BNB, Credit Agricole Bulgaria, BSP, GERB
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