29.8.2008 by CrniLabudovi.

Size of grey economy remains high in Bulgaria, Romania

25/08/2008

Analysts have urged policy makers in Bulgaria and Romania to take measures that will encourage more people in their countries to join the formal economy.

(Dnevnik, Mediapool - 30/07/08; Sofia Echo, Dnevnik, Mediapool, Center for the Study of Democracy - 27/05/08; Report on Informal Employment in Romania, OECD, July 2008)

The EU’s two newest members, Bulgaria and Romania, still have large informal economies. Construction and tourism are among the sectors most prone to gray market activity, analysts say.

Some 200,000 Bulgarians work in construction, according to the state National Statistical Institute (NSI). Officially, the average monthly wage in the sector is 211 euros. But that figure is profoundly misleading, insists Georgi Anegelov, senior economist at the Open Society Institute in Sofia. In reality, no construction worker in the country is paid less than 500 euros, he said. This means the tax and social security systems are losing nearly 665m a year, he added.

According to Angelov, the situation in the hotel and restaurants sector, which employs more than 100,000 people, is the same if not worse. No waitress or a hotel maid would ever agree to work for the mere 161 euros quoted in the official statistics as the average net monthly salary in the sector in the first quarter of 2008, he said. Thus, the sector’s hidden revenues amount to at least 250m annually.

Meanwhile, a policy brief released by the Centre for the Study of Democracy (CSD) earlier this year named agriculture and services — particularly repairs, private education and healthcare — as being associated with informal economy activities. “Research has also shown that there are also considerable grey pockets in manufacturing, in particular in excise industries (alcohol and cigarette production and fuels), textiles and transport,” the Sofia-based think-tank said.

Although some of the measures taken by the Bulgarian authorities over the past few years have helped reduce the share of the country’s shady economy, it remains a key constraint to investment and growth, the group warned.

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Setimes 

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29.8.2008 by CrniLabudovi.

Iraq reaches oil agreement with China

Hussain al- Shahristani, oil minister of Iraq, warned that time was running out for big Western oil companies to seal even short-term deals. (STR via Reuters)

Reuters

Thursday, August 28, 2008

BEIJING:

Iraq and China have agreed on the terms of a $3 billion oil service contract, the Iraqi oil minister said Wednesday, announcing his country’s first major oil contract with a foreign company since the fall of Saddam Hussein.

The oil minister, Hussain al- Shahristani, warned that time was running out for big Western oil companies, which have pressed for years for Iraqi contracts, to seal even short-term deals that had been expected to mark their return to Iraq, which has the world’s third-largest oil reserves after Saudi Arabia and Iran.

Iraq and the Chinese state-run oil company, CNPC, have agreed on the renegotiated terms of a deal signed in 1997 to pump oil from the Ahdab oil field, Shahristani said. CNPC is the biggest oil and gas company in Asia.

“Finally we have reached an agreement,” Shahristani said. “The total investment of the project is expected to be about $3 billion.”

Iraq has toughened the terms, changing the contract to a set-fee service from the production-sharing agreement signed under Saddam.

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