EU-Report Accession Bulgaria

Methodological Notes

Inflation rate

As part of the preparations for the common currency the EU Member States (MSs) have designed a new consumer price index in order to comply with the obligations of the EU Treaty. The aim was to produce CPIs comparable between Member States. The main task was to harmonise methodologies and coverage. The result was the Harmonised Index of Consumer Prices (HICP). A similar exercise has been started with Candidate Countries (CC). In respect to enlargement it is equally important that their economic performance is assessed on the basis of comparable indices. Some progress has already been made towards adapting the new rules. Since January 1999 CCs report monthly to Eurostat socalled proxy HICPs that are based on national CPIs but adapted to the HICP coverage. They are not yet fully compliant with the HICPs of the MSs. In the table the proxy HICPs are back-calculated to 1996 (rates from 1997).

Finance

Public finance: The government deficit and debt statistics of the Candidate Countries are provisional. in the sense that they do not yet fully comply with EU methodological requirements. Broadly speaking. the general government deficit / surplus refers to the national accounts concept of consolidated general government net borrowing / net lending of ESA95. General government debt is defined as consolidated gross debt at endyear nominal value. The series are available from 1997; the 1996 data are an approximation derived from the IMF's GFS methodology.

Gross foreign debt is of the whole economy. covering both short- and long-term. but excluding equity investment and money market instruments. The source for stock of outstanding debt is OECD while the source of GDP is Eurostat. For the ratio of gross foreign debt to exports the national accounts definition of exports of goods and services is used (source: Eurostat). The data for 2000 are Eurostat estimates. based on joint OECD/IMF/BIS/World Bank series.

Monetary aggregates are end-year stock data. as reported to Eurostat. Generally M1 means notes and coin in circulation plus bank sight deposits. M2 means M1 plus savings deposits plus other short-term claims on banks. M3 means M2 plus certain placements in a less liquid or longer-term form. Not all countries produce an M3 series. Total credit means loans by resident monetary financial institutions (MFIs) to non-MFI residents.

Interest rates:

Annual average rates based on monthly series reported to Eurostat. Lending rates refer to bank lending to enterprises for over 1 year. Deposit rates refer to bank deposits with an agreed maturity of up to one year. Day-to-day money rates are overnight interbank rates.

Exchange rates:

ECU exchange rates are those that were officially notified until 1 January 1999. when the ECU was replaced by the euro. Euro exchange rates are reference rates of the European Central Bank. The effective exchange rate index (nominal). as reported to Eurostat. is weighted by major trading partners.

Reserve assets

are end-year stock data as reported to Eurostat. They are defined as the sum of central bank holdings of gold foreign exchange. SDRs. reserve position in the IMF and other claims on non-residents. Gold is valued at end-year market price.

External trade

Imports and exports (current prices). The data is based upon the special trade system according to which external trade comprises goods crossing the customs border of the country. Trade data excludes direct re-exports and trade in services and trade with customs free zones as well as licences know-how and patents. Value of external trade turnover includes the market value of the goods and the additional costs (freight. insurance. etc.). The term FOB means that all costs incurred in the course of transport up to the customs frontier are charged to the seller. The term CIF means that the purchaser pays the additional costs. Exports are recorded here on FOB basis. Imports are recorded on CIF basis.

Trade Classifications. Merchandise trade flows are recorded according to Combined Nomenclature (CN) and the Single Administrative Document (SAD).

Imports and exports with EU-15. Data declared by Bulgaria.

Demography

Net migration rate. Crude rate of net migration (recalculated by EUROSTAT) for year X. is: population (X+1) -- population (X) -- Deaths (X) + Births (X). This assumes that any change in population not attributable to births and deaths is attributable to migration. This indicator includes therefore also administrative corrections (and projection errors if the total population is based on estimates and the births and deaths on registers). Figures are in this case more consistent. Further most of the difference between the Crude rate of net migration provided by a country and the one calculated by Eurostat is caused by an under reporting or delay in reporting of migration.

Life expectancy. Data are compiled on the basis of a survey carried out with three-years periodicity.

Labour force

The European Labour Force Survey is conducted in spring each year in accordance with Council Regulation (EEC) No. 577/98 of 9 March 1998. A detailed description of the sampling methods, the adjustment procedures, the definitions and the common Community coding currently used in the labour force survey is presented in the publications `Labour Force Survey ­ Methods and definitions. 1998' and `Labour Force Survey in central and east European countries ­ Methods and definitions 2000'.

All definitions apply to persons aged 15 years and over living in private households. The concepts and definitions used in the survey follow the guidelines of the International Labour Organisation. Persons carrying out obligatory military service are not included.

Persons in employment were those who during the reference week did any work for pay or profit for at least one hour or were not working but had jobs from which they were temporarily absent. Family workers are included.

The rates on average employment by NACE branches are based on National accounts data (ESA) and therefore not entirely comparable to those of other Candidate Countries which are based on the LFS. The most important difference concerns the conscripted forces which are not included in the LFS but are included in ESA under general government services. For details see chapter 11. paragraph 19 of the ESA methodology.

As from 2001 (Commission Regulation (EC) No 1897/2000 of 7 September 2000) unemployed persons comprise persons aged 15 to 74 who were:

(a)

without work during the reference week. i.e. neither had a job nor were at work (for one hour or more) in paid employment or self-employment;

(b)

currently available for work. i.e. were available for paid employment or selfemployment before the end of the two weeks following the reference week;

(c)

actively seeking work. i.e. had taken specific steps in the four weeks period ending with the reference week to seek paid employment or self-employment or who found a job to start later. i.e. within a period of at most three months.

Duration of unemployment is defined as:

(a)

the duration of search for a job. or

(b)

the length of the period since the last job was held (if this period is shorter than the duration of search for a job).

Inactive persons are those who are not classified as persons in employment nor as unemployed persons.

Employment rates represent employed persons aged 15-64 as a percentage of the same age population.

Unemployment rates represent unemployed persons as a percentage of the active population aged 15 years and more.

Economic activity rates represent the active population aged 15-64 as a percentage of the population of the same age.

Data refer to June of each year.

Infrastructure

Railway network. All railways in a given area. This does not include stretches of road or water even if rolling stock should be conveyed over such routes; e.g. by wagon-carrying trailers or ferries. Lines solely used for tourist purposes during the season are excluded as are railways constructed solely to serve mines; forests or other industrial or agricultural undertakings and which are not open to public traffic. The data considers the construction length of railways.

Length of motorway. Road. specially designed and built for motor traffic. which does not serve properties bordering on it. and which:

(a)

is provided. except at special points or temporarily. with separate carriageways for the two directions of traffic. separated from each other. either by a dividing strip not intended for traffic. or exceptionally by other means;

(b)

does not cross at level with any road. railway or tramway track. or footpath;

(c)

is specially sign-posted as a motorway and is reserved for specific categories of road motor vehicles.

Industry and agriculture

Industrial production volume indices. Industrial production covers mining and quarrying. manufacturing and electricity. gas. steam and water supply (according to the NACE Rev.1 Classification Sections C.D.E).

The index of annual industrial production is based on the exhaustive survey of enterprises (public and private) assigned to industrial sector.

Gross agricultural production volume indices. Data are based on SNA methodology and include agriculture and forestry (NACE sections A and B).

Standard of living

Number of cars. Passenger car. road motor vehicle. other than a motor cycle. intended for the carriage of passengers and designed to seat no more than nine persons (including the driver).

The term ``passenger car'' therefore covers microcars (need no permit to be driven). taxis and hired passenger cars. provided that they have less than ten seats. This category may also include pick-ups.

Internet subscriptions: Data are provided by Bulgarian Telecommunication Company.

Sources

Total area. external trade. labour market. infrastructure. demography. industry and agriculture. standard of living (except Internet connections): National sources.

National accounts. inflation rate. balance of payment. public finance. finance: Eurostat.

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