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"Bulgaria's stock exchange has high chances of attracting a strategic investor, who is one of the big names on the European capital market," Assen Yagodin, president of the bourse's Board of Directors, told journalists on Thursday.

He refused to disclose names and clarified that potential bidders will hold negotiations with the Finance Ministry, which owns the majority stake.

"We strongly believe that international investors have already shown interest,"Yagodin stressed and cited Finance Minister Simeon Djankov, who claimed that the sale of the state-owned stake in the bourse will be wrapped up by the end of the year.

A few months ago Ivan Takev, executive director of the stock exchange, admitted that the increase of the Bulgarian government's share and its self-listing will lead to the sale of its majority stake to an industry investor in a bid to boost liquidity, restore market growth and investor confidence.

The next step, to be made in the short term, will be for major state-owned companies to be listed on the bourse.

Bulgaria's only stock exchange became a public company in the middle of December last year after the Financial Supervision Commission approved its prospectus and the bourse was listed on its own platform. The capital of the bourse is a total of BGN 6 582 860 at BGN 1 apiece.

Bulgaria's Finance Ministry raised at the beginning of October its share to 50% plus one share from 44% in the country's stock exchange. The government bought 715,000 shares at BN 1 apiece. The bourse will sell the remaining 50% held by private investors including brokerages and banks.

The shareholders said the move aims to ease the future privatisation of the exchange and the search for a strategic investor.

Since 2008, the stock exchange has traded on the Deutsche Boerse's Xetra platform under a contract that expires in 2012. Bulgaria has discussed ways to sell its bourse stake over the past decade with Sweden's OMX AG and exchanges in Austria, Greece and Poland to boost interest in local stocks and make trading more transparent.

Representatives of the Finance Ministry and the Stock Exchange have commented that the move will give the ministry the opportunity to seek a strategic investor, make the Exchange transparent, increase interest towards the capital market and reinstate the trust in the latter.

Meanwhile Victor Papazov, founder, former CEO and chairman of the BulgarianStock Exchange has harshly criticized the decision, saying the Bulgarian government is threatening the country's economic future by effectively nationalizing its stock exchange at a knock-down price.

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One of the major changes is decriminalizing mistakes made in the application forms; any mistakes can now be corrected during the application process.

"By the end of 2011 we will propose ten more grant schemes worth about EUR 400-500 M. In that way we will pave the way for negotiating the entire amount slated for Bulgaria under the Competitiveness program 2 years before its end. We have introduced a very important change in the program – focusing on procedures in fields that we would like to develop, which are strategically important for our economy, and have the highest added value. The priorities for the Bulgarian economy are innovations and sectors with lower energy consumption," Traikov declared.

He explained that in the last year the government opened 14 grant procedures for the combined amount of EUR 250 M, which is more than all procedures started in the previous three years. All changes introduced by the Bulgarian Ministry of Economy, Energy, and Tourism have been approved by the European Commission.

In the past 18 months, since Traikov has been in office, the Ministry experts have received and evaluated a total of 1 500 project proposals.

At present, about 50% of the total amount of money slated for Bulgaria by the EU under the Competitiveness Operational Program for 2007-2013, or a total of EUR 600 M, have been negotiated for specific projects or there are talks under way.

Contracts under projects worth a total of EUR 100 M are under discussion with applying businesses.

A total of 9 grant procedures worth EUR 173 M are active at present; EUR 60 M of these have gone for direct investment activities, EUR 55 M – for innovative plants, EUR 60 M – for modernization of small and medium-sized enterprises.

A total of 97% of all payments under Competitiveness program grants to date were made only in the past 18 months.

Minister Traikov hopes that all competitiveness money from the EU for 2007-2013 can be negotiated for specific projects by the end of 2013, and then be absorbed by the end of 2015.

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"Bulgaria has entered an inflationary spiral," Stanishev said.

"Because of the ongoing increase of prices of most basic goods and services, the minimum wage must be increased to at least 300 leva starting next month, which would cost the Budget about 14 million leva," he said.

"This will not represent a problem for the Budget. Additionally, the child allowances have been frozen at 35 leva for years, and must be raised by at least 10 leva," Stanishev said.

The socialists also demand that pensions are adjusted for inflation and that recipients of energy aid be granted a one-off 50 leva bonus.

"We will allow the Government until the end of the month to initiate these measures, including adjustments in the Budget."

"If not, the BSP will initiate social protests," Stanishev said.

"It is becoming ever more apparent that in order for the Government to react adequately against poverty, we must apply pressure. I am assuming that there will be protests, a national outcry," he said.

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Harrold, who met with Bulgaria's Prime Minister Boyko Borisov, has guaranteed that the International Financial Corporation, the member of the World Bank Group that finances and provides advice for private sector ventures and projects, will continue to support the country's green investments, as well as the investments in infrastructure, industry, agriculture and the social sector.

The World Bank is preparing a strategy for its partnership with Bulgaria in the period 2011-2015, it was made clear during the meeting. The strategy is expected to be discussed in May 2011 by the institution's board of financial directors.

" The new partnership strategy must help Bulgaria to achieve steady growth, focusing on reform policies and further developing the institutional capacity in certain sectors," Peter Harrold said.

Bulgaria has to make use of the existing EU financing, while the support from the World Bank will be technical and analytical, with additional financing if necessary, according to him.

"I am extremely satisfied by the cooperation between the Bulgarian government and the World Bank and I am sure it will continue. Thanks to our collaborative efforts, the Bulgarian citizens already see the materialization of projects, which have only been promised for the past 20 years," Boyko Borisov said.

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Traikov spoke Wednesday for the Bulgarian National Television, BNT, saying he further expects an increase of foreign investments from the 2010 BGN 1 B.

"The amount of the investments is less important than their destination. Before the crisis they focused on construction, but now they mostly aim at the production sector," the Minister said.

When asked about the future of the heating utilities, Traikov explained their salvage is in the establishment of co-entities (for the production of electric power and heat, which they will also sell) to attract foreign investors and to be privatized or have municipalities make their own investments.

"Municipalities wanted the heating utilities and they got them. I am watching with great interest to find out how they will deal with their management," the Minister pointed out.

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