Financial Times; Aug 20, 2001
By PHELIM MCALEER

The newly elected Bulgarian prime minister has announced measures to reform the privatisation process and reduce taxation.

Mr Simeon Saxe-Coburg, the former king who was deposed by the Communists in 1946 but swept to power in the recent general election, said his government was introducing a level playing field for privatisations.

He said the much criticised previous system that favoured management/ worker buyouts was being abolished. The buyouts had been accused of being prone to corruption and cronyism, with the government appointing political associates as managers so that they could benefit from the sell-offs.

Mr Saxe-Coburg also said the Privatisation Agency would be the only government institution involved in the sale of state-owned assets. Under previous administrations some controversial deals were carried out by various government ministries who were accused of corrupt sell-offs.

Mr Saxe-Coburg also said he was introducing radical measures to reform the country's customs service, which has been accused of widespread corruption. His government would invite foreign experts to supervise the day-to-day operations. "They will smash corruption and bring the black economy into the light," he said.

The former king said his government, which is largely made up of technocrats, was introducing tax reforms to encourage investment, including a zero tax rate on company profits that are reinvested.

He also announced a rise in the minimum wage and increase in tax thresholds. The former king said he was making the announcement so soon after taking power because Bulgaria was at an important stage in its history. "The last couple of months have put Bulgaria at centre of world attention. If we disappoint expectations now the cost for the country will be very great," he said.

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