SUBJECT: VERSION 1.3. OF THE NATIONAL RECOVERY AND RESILIENCE PLAN

SUBJECT: Updated draft of the National Resilience and Recovery Plan

(Version 1.3 of 20.07.2021)

DEAR MR. PEKANOV,

The Bulgarian Industrial Association - Union of Bulgarian Business (BIA) closely monitors the preparation of  Bulgaria's National Resilience and Recovery Plan (NRRP). In recent months, BIA has made several proposals to improve the structure and content of the NRRP, some of which have been adopted by the state administration. As a result, there are visible improvements in the presentation of individual projects and reforms that are already linked to the European Flagships and the correspondence to some of the specific recommendations to Bulgaria, which the Plan should provide. In this sense, they were part of the recommendations set out in the opinion of the Economic and Social Council to the first published version of the NAP. Therefore, we generally assess the work on upgrading the projects covered by the Plan as positive. However, we continue to have reservations about some decisions.

We are particularly interested in the Economic Transformation Program as an employers' organization. We fully support the arguments expressed in the letter of the employers 'and trade unions' organizations to the President of the Republic of Bulgaria, sent with a copy to you (entry №17-00-53 / 29.06.2021) and the Minister of Economy Mr Kiril Petkov, regarding the ratio of financial instruments to grants. We are disappointed that there are no indications that this proposal will be reconsidered. Economic policy-making should not be opposed to start-ups and operating companies with different needs for tools to recover and develop their business. A balanced solution should be sought on this issue, reflecting the needs of as many companies as possible, with the funds reaching the real sector as quickly as possible.

Per Art. 18, vol. 4, p. "R" of Regulation (EU) 2021/241 of the European Parliament and of the Council of 12 February 2021 establishing a Mechanism for Resilience and Recovery, we again draw your attention to the necessity of institutionalizing the nationally represented employers 'and workers' organizations, the consultation of the social partners in the monitoring the implementation of the Plan. As stated in the ESC opinion cited above, it is necessary to manage investments following the principles of partnership. This would allow the transparent involvement of the social partners in decision-making on the details of the procedures for implementing and monitoring policy interventions. Furthermore, this will ensure an adequate and timely process of control and feedback from the socio-economic partners and other civil society representatives in the implementation of measures, progress and implementation of the Plan.

We take this opportunity to once again call for action to formally submit the Plan so that Bulgaria can take advantage of the possibility of the advance payment and start the actual implementation of projects. We also express grave concerns that given the open issues presented by you at a sitting of the Committee on European Union Affairs of the National Assembly on 01.09.2021, there is a possibility that the Council will not approve the project in the coming months. With regard to the proposal to set up an Energy Transition Commission to draw up a Roadmap to Climate Neutrality, we believe that its work should be based on a long-term strategy with a horizon of 2050, through which it makes consistent and concrete commitments ensuring a smooth transition to decarbonization in the energy sector.

In line with the requirements of the Annual Sustainable Growth Strategy 2021 (GDS), which sets out the basic principles within the priorities of the Member States in the resilience and recovery plans, all national programs must intensely focus on reforms and investment in support of green and digital transition and justice.

The GOSS emphasizes that public funds to be provided through the Mechanism for Resilience and Recovery should not replace or crowd out private investors, but complement where necessary, ie. when systemic or market failures or damage due to the COVID-19 epidemic and the ensuing economic crisis do not allow the market to recover on its own and achieve policy objectives. Furthermore, maintaining a level playing field within the single market is necessary to foster innovation and speed recovery.