THE PERCEPTION OF THE POPULATION IN THE CROSS-BORDER REGION ROMANIA BULGARIA ON THE SOCIAL AND ECONOMIC SITUATION

THE PERCEPTION OF THE POPULATION IN THE CROSS-BORDER REGION ROMANIA BULGARIA ON THE SOCIAL AND ECONOMIC SITUATION STATISTIC SURVEY IN THE HOUSEHOLDS IN THE CROSS-BORDER REGION ROMANIA - BULGARIA (AGOS) MEHEDINŢI OLT CĂLĂRAŞI DOLJ TELEORMA N GIURGIU SILISTRA CONSTANŢA VIDIN MONTANA PLEVEN RUSE RAZGR AD DOBRIC VRACA VELIKO TARNOVO 2012 1

CONTENTS INTRODUCTION... 5 Part I THE METHODOLOGY OF THE SURVEY... 7 1. Coverage area... 7 2. Data entry method... 8 3. Survey pattern... 8 4. Survey forms... 9 Part a II-a THE RESULTS OF THE SURVEY... 11 1. Economic structure of the households... 11 2. Urbanistic infrastructure... 29 3. Education, health, environment infrastructure... 45 4. Social relations... 62 5. Trust in the institutions of the local public administration... 67 6. Business and labour market efficiency... 81 7. Cross-border Romanian-Bulgarian contacts... 88 8. Transparency of the Cross-border Romania-Bulgaria cooperation program... 93 9. Conclusions... 96 Part a III-a STATISTICAL ANNEX: TABLES WITH PERCEPTION INDICATORS... 103 1. Share of the households with insured dwellings, by types of events for which they are insured 2. Share of the households with uninsured dwellings, by reasons 3. The share of households that have had damage (damages) by the type of events that have produced the damages 4. The distribution of households by the standard of living of the members of the household in the current year compared to the previous year (2011 compared with 2010) 5. The distribution of households by the evolution of the living standards in the next year compared to the current year (2012 compared to 2011) 6. The distribution of households by the evolution mode of the total monthly income in the current year compared to the previous year (2011 compared with 2010) 2

7. The distribution of households by the evolution of the monthly total income of the household in the next year compared to the current year (2012 compared to 2011) 8. The distribution of households by the income sources of the members 9. The distribution of households by the degree of coverage of the current expenditures by the incomes of the members 10. The share of households that have made loans 11. The respondents distribution by the opinion regarding the support obtained from banks to obtain bank credit 12. The respondents distribution by the difficulty in obtaining bank credit 13. The distribution of households by the type of neighborhood 14. The distribution of the respondents by their opinion on the degree of damaging the residential areas of the urbanistic infrastructure 15. The respondents opinions regarding the accessibility at certain social services: distance from certain units of health, education, or the inexistende 16. The degree of impairment of space inhabited by various environmental factors 17. The accessibility to green areas near the dwellings 18. Opinions about the lack of the necessary units/ services for the social life in the city 19. Opinions on relationships with neighbours 20. Opinions on conflicts with neighbours 21. The degree of appreciation of certain categories of local government services 22. The degree of appreciation of the programmes, decisions and actions of LPA 23. The degree of appreciation of consulting the citizens by LPA 24. The involvement of citizens in LPA projects 25. The degree of appreciation of the proposals and demands of the citizens by the APL 26. The availability of jobs in the area 27. The degree of utilization of highly qualified labour force 28. The degree of appreciation of the highly qualified workforce 29. Opinions on business concerns of training the employees 30. Opinions on the system of taxation of income from employment 31. Opinions on the city's tourism potential 32. Views on the modalities for the development of tourism in the town/area 33. Opinions on taxes on real estate properties 34. Frequency of visits in Bulgaria/Romania 35. The distribution of visits in Bulgaria/Romania by their reason 36. Satisfaction degree of visits in Bulgaria/Romania 37. Distribution of respondents who have made visits to Bulgaria/Romania, as to why they have made the visits 38. Intentions to make visits in Bulgaria/Romania, by the visit reason 39. The degree of knowledge of the Bulgarian Romanian language 40. Assessing the usefulness of the knowledge of the Bulgarian/Romanian language 41. Availability of promotional materials in the Bulgarian/Romanian area 3

42. Degree of appreciation of the need for promotional materials in the Bulgarian/Romanian area 43. Awareness of the CBC Programme Ro-Bg 44. The degree of involvement of the population in the CBC Programme actions/projects, Ro-Bg 4

1 INTRODUCTION The purpose of this report is to present the methodological and organisational design of a selective statistical survey (AGOS Survey) carried out in households in the Bulgaria-Romania cross-border region. The survey was designed and implemented in 2011 by the Consortium coordinated by the Romanian Institute of Social and Economic Research and Surveys (IRECSON) under the contract "Conducting statistical studies and polls in the crossborder area Romania-Bulgaria", as an integral part of the project entitled "the status and socio-economic development of the cross-border region Bulgaria-Romania. The Strategic Project is developed via the Operational Program of Cross-Border Cooperation Romania - Bulgaria 2007-2013 (CBC RO-BG 2007-2013) and aims to create a support tool for the authorities involved in managing the program, and for the potential beneficiaries and general public in the two countries, by providing a comprehensive and complete database of indicators of demo - social - economic domains. The main objective of the survey in the households in the Bulgaria-Romania cross-border region was to produce statistics on the perceptions of social and economic environment. Therefore, information were collected concerning various aspects of public life, such as: economic situation of households, public infrastructure, education infrastructure, health and environment infrastructure, social capital, trust and confidence of the public in the local institutions, the efficiency of the adminstrative business and labour force, the intensity of the Romanian-Bulgarian border contacts. In addition, information were collected on the assessment of population and its involvement in supporting actions and projects promoted by the institutions of local public administration, the immediate needs and expectations of the inhabitants for the near future, the transparency of the cross-border cooperation programme (known by the people of the region and the degree of participation of the population in the program projects). The information collected by survey can be used by the authorities involved in managing the cross-border Romania-Bulgaria cooperation programme 2007-2013(Bg, Ro-CBC 2007-2013) to assess the impact of implementation of the various projects in the region, developed within the framework of the programme, but also for identifyinf sustainable strategic development directions. The study is structured in three sections in the issues surrounding the concept of investigation, its implementation and the results obtained. The first section approaches technical, conceptual, methodological and organisational issues of AGOS survey: coverage area, the observation unit, data entry method, the survey pattern, observation program and content of the questionnaire, the personnel involved and the investigation procedures. It also describes the conceptual framework of the processing of such information and the contents of the database. In section two the main results of the survey regarding the perceptions of the population in the cross-border region on significant aspects of the impact of the social and economic environment in the region, areanalysed. The section includes eight chapters, in which perception of the population on all aspects that have been investigated through the surbey is analysed, in a logic order of the questions in the questionnaire. 5

Section three is the statistical annex in which the output tables with the main perception indicators calculated on the basis of the information gathered through survey 2011 AGOS are presented. 6

2. Part I THE METHODOLOGY OF THE SURVEY 2.1. COVERAGE AREA The Household Survey (AGOS) was carried out on a sample of households randomly selected from all counties and districts which form the eligible area of the cross-border cooperation program Romania-Bulgaria. The coverage area of the survey included all households located in the dwellings situated in the urban and rural area in which the programme is eligible. The program area is located in Northern Bulgaria and southern Romania, along the national border that stretches between Serbia and the Black Sea. The eligible area is composed of seven counties and eight districts, located right next to the Bulgarian national border. These 15 territorial units (NUTS III level) belong to a number of 6 development/planning regions (NUTS II level), as follows: Mehedinti, Dolj and Olt counties which belong to the South-West Oltenia Development Region in Romania; Calarasi, Giurgiu and Teleorman counties which belong to the Southern development region Muntenia in Romania; Constanta county belongs to the South-East development region of Romania; Vidin, Vratsa, Pleven, Montana districts which constitue the North West Region in Bulgaria; Veliko Tarnovo, Ruse and Silistra districts in the planning region -Bulgaria; Dobrich district which belongs to North East planning of Bulgaria. Compared with the above-mentioned districts, using the flexibility rule of article 21 (1) of the ERDF regulation, Razgrad district was included in the eligible area of the programme, the decision was based on the argument that it is adjacent to the NUTS III eligible areas Ruse and Silistra, located at only 10 km from the national border (River Danube) of Bulgaria. This district was included in the program area considering that it has the same needs, constraints and features with the cross-border area. It was considered after this inclusion, the whole eligible territory becomes more compact. In the eligible area of the statistical selective observation survey were included all household members, including persons who left the country for a long period (over 6 months), if, during the period of the investigation, they maintained contact with the household in which they belonged, such as students and students who went abroad for studies, workers, prisoners and convicted persons, persons in hospitals or which are temporarily in sanatoria for treatment or recovery. Within the scope of the statistical research there were not included the persons who lived permanently in the joint units of accommodation (hotels, residences, homes for disabled children, labor organizations, nursing homes etc..). 7

2.2. DATA ENTRY METHOD For the random survey, the observation and registration unit was the household. For information collection, the interview method has been used. The interviews were carried out with the household reference person (head of household) or another member of the household who knows the situation of the household. In Romania, collecting information and completing the survey responses in the questionnaires was done by an interview "face-toface" at the eligible households. In Bulgaria, the collection of information was conducted through face to face interviews in households in rural areas and through telephone interviews (CATI) in the case of households in urban areas. In both situations, the operator had a main role in completing the interview, which has been trained to ensure the conduct of the interview (presentation and explanation of the scope and specifics of the investigation, the wording of the questions, any appropriate explanations in the event of any disputes, resolving certain difficulties etc. ), the confidentiality and correctness of information entered in the questionnaires. Conducting interviews and registering information in the questionnaires was done during the period September-November 2011. 2.3. THE PATTERN OF THE SURVEY The survey of households in the Bulgaria Romania cross-border region has been organised as a statistical research on a pattern of approximately 12,000 dwellings (households) spread across the Romanian counties and the Bulgarian districts proportional to the population of the residential areas (urban and rural). The survey size has been calculated to ensure the qualitative indicators estimations with an error of +/-1%. The households pattern, which included the households in the suvey, also included: 7193 households in the Romanian area and 4,800 households in the Bulgarian area. In Romania, for the selection of the pattern, a "master" type survey sampling and a two-stage survey plan have been used. 1). The first stage of sampling- selecting the "master" pattern In the first step, the "master" type survey sample has been selected, as a sample of well defined geographical areas in the territory ("master" pattern). In a first phase, the national territory was divided into geographical areas, called Primary Units (UP), so that no area of the national territory to be excluded. From these primary units, a UP sample has been extracted, of research centres which are included in the "master" type pattern. Of these research centres, there are selected specific households for households survey. 2). The second stage of sampling selecting the dwellings/households pattern In the second stage of sampling, there were selected the households in the AGOS survey pattern. The household pattern was formed by extracting them from the research centres established in counties that are part of the program's eligible area: Constanţa, Giurgiu, Călăraşi, Dolj, Teleorman, Mehedinţi, Olt Counties. 8

In Bulgaria, there has been a sampling plan in two steps. 1). The first stage of sampling - the selection of the sample of primary research units In the first sampling stage, the population of the Bulgarian area of the RO-BG cross-border has been stratified on 9 districts (Nuts3), two levels of urbanization (urban and rural), 4 levels of population (500 inhabitants, 501-9999 inhabitants, 10,000-4999 inhabitants, and more than 50,000 inhabitants), obtaining 45 layers. The territory of the Bulgarian area was divided into geographical areas, called Primary Units (UP), so that no area of the national territory has been excluded. From these Primary units, it has been extracted a sample of UP. Of these research centres, there are selected housing samples for the household survey. 2). The second stage of sampling - selecting the dwellings/households pattern In the second stage of sampling, there were selected the households in the AGOS survey pattern. The household pattern was formed by extracting them from the research centres established in districts that are part of the program's eligible area: Veliko Tarnovo, Vidin, Vratsa, Dobrich, Montana, Pleven, Razgrad, Ruse, Silistra. 2.4. SURVEY FORMS Information about each household and its members have been filled in the household Questionnaire. The household questionnaire is structured in 10 sections that include questions for registering the opinion of the respondents on the various aspects of the life of people. The first two sections contain identifying information about the dwellings, households and individuals. Other sections contain questions that shall ensure the data collection related to: The economic situation of households: living conditions, housing conditions, living standards (appreciated and expected),income dources, the coverage of expenditures; The public utilities infrastructure (issues affecting the inhabited area and the degree of impairment of certain infrastructure elements -household); Education, health and environment infrastructure, considered by the disponibility of the supplying units in these domains and major factors that influence the living conditions of household members; Individual relations and social solidarity : relations with neighbors in the area, benefit/contribution to these relationships; Civic action and empowerment: trust in institutions of local public administration, participation/involvement of the population in the community projects, perception/opinion on the population ability to influence the actions and decisions of local administration; The effectiveness of business and labour: employment availability (the offer on the local labour market), the quality of the labour efficiency and tourism potential of the area; 9

The Romanian-Bulgarian border Contacts: visits in villages in the neighboring country and the reasons for the visits; the degree of satisfaction of socio-economic conditions of the visited localities, the degree of knowledge of the Bulgarian/Romanian language and the degree of usefulness of knowing the Romanian/Bulgarian area, means of information/advertising in Romanian/Bulgarian language; Transparency of the cross-border cooperation programme: the degree in which it is known by the population in the region and the degree of participation/involvement of the population in the various projects developed under the programme. 3. Part II THE RESULTS OF THE SURVEY The sample of nearly 12,000 households on which the AGOS survey was carried out in the cross-border region, was allocated in proportion to the population of the two border areas (Romanian and Bulgarian) and administrative-territorial units of their components. In this way, the representative ness of the results at the counties/districts and residential areas levels were ensured (urban, rural). Thus, the views of those who responded to the survey that is the respondents (the respondents), are representative for the whole population from which the survey pattern is representative (County/area, residential area). For the presentation and analysis of the opinions of the population, there have been calculated the shares of the number of respondents per question and per response variant, to the total number of the same responses. We present, in what follows, the analysis of the main results of the survey on the perception of the economic and social environment. 3.1. Economic situation of the households The main sources of income in both cross-border areas are wages and pensions; For the Romanian area, a higher share of the households which have income in kind is registered, compared to the situation in the Bulgarian area (11.9% versus 5.3%); If in the Bulgarian area, the main source of loans taken by private households within the 12 months preceding the interviews were banks or other financial institutions in the Romanian border area, informal loans from relatives, friends, neighbours, etc. predominate. ; Most of the households in both cross-border areas consider that the income in 2011 remained at the same level or decreased compared to the same period of 2010 (77,3% households in the Romanian border area and 70.6% in the case of the Bulgarian area); 10

If the general appreciation for the Romanian households of the living standards is very accurate to the assessment made in the case of the income, the households in the Bulgarian area are more severe when it comes to the standard of living (52.4% of households in the Bulgarian area consider that the level of their standard of living will decrease in 2012, compared with 34.8% of the households who expect a decrease of the incomes) ; With regard to the evolution of the incomes, it is different in the two areas: while most Romanian households (56.1%) expect a decrease in 2012, compared to 2011, the Bulgarian households consider (55,2%) that their income will slacken at the levels of 2011; From the point of view of the extent of coverage of current expenditures by total net income available to households, we observe that the majority of households are facing severe or less severe restrictions on covering the current expenditures of the incomes; When it comes to evaluating future standards of living, the prospects for the near future are rather negative than positive, the majority of households stating that the standards of living will decrease to a greater or less extent (62,1% of households in the Romanian area and 52.4% of the households in the Bulgarian area). To analyse the perceptions of the population on the social and economic situation of the region, an assessment of the economic situation at the micro level, namely at the level of households is necessary, because the living conditions of the household members are hallmarking on their vision about the economic and social environment. In this respect, the programme of the AGOS survey, transposed into a specific questionnaire, encompassed a series of self-assessment questions which enabled the households self-assessment of the living standards since the completion year of the survey, but also the perspectives for its development, the sources of income of the household and the extent to which they cope with the daily living conditions. Households income sources As regards the households income sources in the cross-border region, they consist primarily of wages and retirement incomes. In the Romanian area, 58% of the households receive incomes from pensions and 43.6%; receive incomes from wages from the activities carried out. One of five households, receive incomes from activities carried out by self-employed persons and 13% of households receive incomes from pensions and other social benefits 11

(other than pensions). About the same percentage of total households receive incomes in kind. 1, 5% of the households receive unemployment indemnisations. Obviously, the specific of the two residential areas is very important for the income sources, as in the urban area of the cross-border region: 60% of households receive wage income, while in the rural areas, only 27, 6% of the households receive wage incomes. Paradoxically, in the rural areas, the incomes from agriculture do not predominate (only one quarter of the households receive such incomes in the rural cross-border area), but pensions predominate among the sources of income of two-thirds of rural households. In Dolj county, a share of i75% of the total income of households are from pensions. The greatest share of the rural households with income from pensions is explicable by the fact that, in the rural areas, population ageing is a phenomenon more poignant than in urban areas. Obviously, the percentage of households which receive incomes in kind is higher in the rural areas than in urban areas (20.4%, compared with 3.4%). Graph 1.1 The percentage of households by the main sources of income in the crossborder area Romanian counties, within the 12 months preceding the interview 70 60 50 % 40 30 20 10 0 Constanta Calarasi Giurgiu Teleorman Dolj Mehedinti Olt venituri salariale pensii venituri din agricultura venituri din activ. neagricole independente ajutoare de somaj alte prestatii sociale venituri in natura Salaries are more often obtained by households in Constanţa and Calarasi counties (55% of the total households in each county); they hold the smallest share among the sources of income of households in Olt County(27,5%). Six out of 10 households in Teleorman, Giurgiu and Dolj counties, receive only pension incomes. In Mehedinţi County the percentage of these households do not weight more than 50%. For incomes from indemnisations and other social benefits (other than pensions), the difference between the countries is high: these are a source of income for nearly a quarter of 12

the households in Dolj County, while among the households in Teleorman and Mehedinţi counties only 5% of such incomes are received. In which regards the incomes in kind, significant differences among the Romanian counties are registered. Thus, if this type of income is seldom met among the sources of income of households in Calarasi and Olt counties, more than a third of the households in Dolj county receive incomes in kind (in the rural areas in this county, the share of such households is of 58,2%). Table 1.1 The share of the households by the main sources of income in the Romanian- Bulgarian border region, within the 12 months preceding the interview - % - Cross-border area Romanian Bulgarian wages 43,6 51,4 Agricultural incomes 14,4 5,1 Non-agricultural independent revenues 5,7 3,3 pensions 57,9 61,1 Unemployment benefits 1,5 3,2 Indemnisations and other social benefits 12,9 5,2 Incomes in kind 11,9 5,3 In the Bulgarian area, the situation of the sources of income is similar, but we have to mention the fact that there is a higher percentage of households that receive incomes from wages (51.4%) and pensions (61,1%). Less than one-tenth of the households receive incomes from self activities performed (8,4%), while one in 20 households receive incomes from pensions and other social benefits (other than pensions), incomes in kind or other sources. By residential areas, in the Bulgarian cross-border region, two of 5 households in rural areas receive incomes from wages, the proportion is significantly higher than that recorded in the rural areas of the Romanian border region. Two out of three households in this area received incomes from pensions, a share higher than that recorded in the urban environment (58,7%), almost equivalent to that recorded in the Romanian area. In which regards the rural households in Vidin, Pleven and Ruse districts, pensions are the most frequently sources of income, while among the rural households in Dobrich and Razgrad districts, less than half of the households receive such incomes. Incomes from pensions and other social benefits are made by one-tenth of the households from the rural areas in the Bulgarian cross-border region, the share being slightly lower than that recorded in the Romanian area. However, in the urban areas of the Bulgarian region, these revenues are obtained at a frequency much lower than in rural areas (2.9% compared to 13

9.3%), except for Razgrad district, where one-fifth of households had benefited from such indemnisations or allowances. It is the district with the lowest share of households receiving income from pensions (46.8%), along with Dobrich (49,2%). Another 10% of the households in the Bulgarian rural areas received revenues in individual activities, a higher weight than in the urban areas (7.2%). The households in Silistra district received this type of income at a share of 19.4%, while among the households in Montana, Vidin, Pleven, Veliko Tarnovo, only one in 20 have this source of income. We must notice the share of less than 10% of the households in rural areas which receive incomes in kind, almost three times lower than that recorded in the rural areas of the Romanian border region. By districts, incomes in kind are made more frequently in rural households in Silistra, Vidin and Ruse (one of 8 households). Table 1.2 The share of households by the main sources of income in the Bulgarian districts of the cross-border region, within the 12 months preceding the interview - % - Total Bulgarian area/districts area Dobrich Montana Pleven Razgrad Ruse Silistra Veliko Tarnovo Vidin Vratsa wages 51,4 57,8 52,4 46,9 49,2 52,6 43,0 58,1 42,0 51,4 Agricultural incomes 5,1 5,6 3,0 2,2 6,0 6,7 15,7 3,1 2,7 4,8 Nonagricultural independent revenues 3,3 4,8 3,4 3,1 2,7 3,3 3,7 1,9 3,0 4,1 pensions 61,1 49,2 65,1 69,4 46,8 67,6 60,1 59,2 68,1 58,6 Unemployment benefits 3,2 2,5 5,2 2,4 8,1 2,0 1,1 3,5 2,0 3,0 Indemnisations and other social benefits 5,2 3,8 3,4 3,7 20,8 1,1 8,7 4,1 3,0 4,8 Incomes in kind 5,3 6,6 2,0 7,6 1,9 4,1 8,2 2,1 11,1 6,8 Other incomes 5,2 3,9 4,3 4,9 9,7 4,0 4,5 4,8 7,4 6,3 Salaries are received with a higher frecquency than in the other districts by the households in Dobrich and Veliko Tarnovo (58%), and least often by the households in Silistra and Vidin (42%). Credits and loans A form of income deficit is attracting loans. In the 12 months preceding the interview, almost two of five households in the Romanian border region received loans. The largest share was 14

for the households in Mehedinţi county (44%), and lowest among the households in Constanta county (30,8%). The share of households that have made loans is very close between the two environments, being only with 1.4 percentage points higher in urban than in rural areas. Most of the times, the loans were from individuals and more rarely from banks or other financial institutions. One in four households has obtained loans from relatives and one of 6 households asked friends for the loans. Only 7.4% of the households had used the banking system to get the loans, and this happened more in urban areas (10.2% of urban households, compared with 4.5% in rural areas). A possible answer for the modest share of loans from the banking system can represent the accessibility of bank credits in the area of the households. And the answer is quite obvious since almost two thirds of households consider that they obtain a loan with difficulties of very much difficulties, and 30% of them believe that obtaining loans from banks, is neither easy nor difficult. Among the households in Mehedinţi and Olt counties, is registered the highest proportion of households which consider that the loand are obtained with difficulties from the banks in the county, while just over half of the households interviewed in Teleorman and Calarasi counties share this opinion. The percentage of the households in Calarasi County which considers that obtaining a bank loan is easy in their county is much larger than that recorded for the entire Romanian border region. Table 1.3 The percentage of households by the opinion on the degree of difficulty in obtaining loans from banks in the town/area in the districts/counties, in the Bulgarian- Romanian cross-border region - % - Total Romanian area/counties area Constanţa Călăraşi Giurgiu Teleorman Dolj Mehedinţi Olt Hard or very hard 62,6 67,7 55,4 61,3 56,9 57,6 70,1 70,0 Neither hard, nor easy 30,4 26,7 32,3 29,7 36,2 38,5 21,2 23,2 Easy or very easy 7,0 5,6 12,3 9,0 6,9 3,9 8,7 6,8 Total Bulgarian area/districts area Dobrich Montana Pleven Razgrad Ruse Silistra Veliko Tarnovo Vidin Vratsa Hard or very hard 44,0 39,6 34,9 40,3 56,1 39,0 56,9 43,3 42,2 49,0 Neither hard, nor easy 35,3 31,2 40,6 39,7 33,3 36,2 24,8 35,4 38,4 36,0 Easy or very easy 20,7 29,2 24,5 20,0 10,6 24,8 18,3 21,4 19,4 15,0 15

In the Bulgarian cross-border area, a quarter of the households have resorted to loans within the 12 months preceding the interview. The households in Razgrad district (34%) resorted to this kind of attracted resources and Montana district (29.1%) and the least in Silistra and Veliko Tarnovo districts (18,3%). Although, the overall average households of the two residential areas, the difference between the percentage of the households with loans is not very high (4 percentage points in favour of urban households) in the rural areas of some of districts, notably in Dobrich, Ruse, and Veliko Tarnovo, the difference is higher than 10 percentage points. A significant difference compared to the Romanian border area is noticed when analysing the sources of these loans. The Bulgarian loans originated mainly from banks or other financial institutions (more than half of households with loans) and less from informal sources from relatives, friends or other individuals. More households received loand in Dobrich (19.0%), Montana, Vratsa, and Ruse counties (15% of households). The households from Razgrad and Montana districts received loand from relatives and friends in a higher share. Table 1.4 The share of households with loans in the past 12 months preceding the interview, according to sources in the counties/districts of the Romanian and Bulgarian border areas -%- Total Romanian area/counties area Constanţa Călăraşi Giurgiu Teleorman Dolj Mehedinţi Olt Relatives 23,1 20,5 18,0 57,4 23,8 26,4 28,0 11,7 Friends 14,9 9,2 15,6 35,4 16,5 19,2 13,1 9,7 Other individuals 6,1 3,6 2,7 11,4 7,1 12,0 4,9 1,1 Bank or other financial institution 7,4 6,4 7,6 24,9 7,1 6,7 5,9 6,6 Other source 1,7 0,5 0,6 2,1 0,6 0,3 1,8 8,3 Total Bulraina area/districts area Veliko Dobrich Montana Pleven Razgrad Ruse Silistra Tarnovo Vidin Vratsa Relatives 6,6 4,8 9,1 6,7 18,4 3,3 4,8 3,1 9,0 6,8 Friends 6,0 3,2 12,1 5,9 17,8 2,3 3,9 2,6 8,3 5,9 Other individuals 0,7 0,5 0,5 0,8 2,4 0,1 0,6 0,3 0,3 1,3 Bank or other financial institution 13,9 19,0 14,8 12,1 11,9 14,9 11,0 12,9 13,3 14,4 Other source 0,8 0,4 0,5 1,3 1,1 0,6 0,8 0,8 1,7 0,7 One of five households in the Bulgarian border area consider that banks offer loans to citizens easy and just over a third of households think they are obtained with a minimum effort 16

(neither hard nor easy). The distribution of households by the opinion on the degree of difficulty in the granting loans by banks to the population shows greater confidence of households in urban areas in this modern way of getting these financial sources, compared to those from rural areas. So if 40% of the urban households consider that obtaining loans is difficult or very difficult in rural areas, the percentages of households who have same views are almost half. Also, the percentage of households which consider that loans are obtained easily or very easily is lower in rural areas (12.7% compared to 27, 2% in urban). Evolution of household income in 2011 compared with 2010 Asked about the way in which the household incomes have evolved in 2011 compared with the same period of 2010, the majority of households in the Romanian border finds that they remained at the same level or decreased: 40% of households in the Romanian area of the cross-border region considering that the income decreased and 31% and that it remained the same, a quarter of households declaring that their income has decreased a lot in the (percentage of households in the rural areas consider this being higher than that of urban households: 30.1% compared to 23.2%). The phenomenon of stagnation of incomes is highlighted and the share of the households which declare that their income has increased in 2011 compared with the same period in 2010: less than 3% of the total area, being higher in the urban areas (4.3% versus 1.3 percent in rural areas). In percentage terms, the households in Calarasi County considered most frequently that their incomes decreased dramatically in 2011 (35.8% of all households, in rural areas the share is 48%). At the opposite pole lies Constanta County, only one out of five households considered that the revenues suffered a significant decrease in the period. A higher percentage, but quite modest (5%) of the households that declare an increase in the revenues is registered in Olt County. Table 1.5 Percentage of households by the opinion on the evolution of income in 2011 compared with the same period of 2010, in counties/districts of the Romanian and Bulgarian border areas -%- Total Romanian area/counties area Constanţa Călăraşi Giurgiu Teleorman Dolj Mehedinţi Olt Decreased very much 26,7 20,1 35,8 28,0 21,6 29,7 29,9 25,3 Decreased a little 39,1 45,2 37,7 46,3 33,6 34,0 45,2 34,8 Remained the same 31,4 32,7 23,3 23,9 41,7 33,8 22,8 34,8 Increased 2,8 2,1 3,2 1,8 3,1 2,5 2,1 5,0 17

Total Bulgarian area/districts Veliko area Dobrich Montana Pleven Razgrad Ruse Silistra Tarnovo Vidin Vratsa Decreased very much 16,4 18,2 13,0 11,2 35,2 14,5 21,8 13,0 10,3 19,1 Decreased a little 24,3 27,6 22,3 20,2 26,7 28,8 29,7 20,9 15,8 27,0 Remained the same 53,0 45,5 57,4 62,8 34,3 50,2 44,2 61,8 66,8 45,3 Increased 6,3 8,7 7,2 5,8 3,8 6,5 4,4 4,3 7,2 8,7 More than half of the households in the Bulgarian border area consider that their income has stagnated at the level registered in 2010, a quarter of them believing that the income registered a slight decrease, and one in 15 households received higher incomes in 2011 compared to the previous year. Improving the household's financial resources was more prevalent in urban areas; the percentage of households that declared that their incomes have increased was higher than in rural areas (8.4% compared to 2.7%). Also, the percentage of households which consider that their incomes have decreased significantly in 2011 is lower in urban areas than in rural areas (14.9% compared to 19.1%). The income growth is more frequently declared by urban households in Vratsa (12.0%), Vidin (11.0%) and Dobrich (10.6%), while nearly 30% of urban households in Razgrad have stated that their incomes have decreased very much in 2011, compared with the previous year. In rural areas, the share of households that considered that the income decreased dramatically varies greatly, from 40% of rural households from Razgrad to 6.3% of households in Vidin. The evolution of the standard of living of households in 2011 compared with 2010 The general assessment of the living standards in 2011 follows exactly the estimation of the incomes, that of a slight decrease, seven out of 10 households in the Romanian border area stating that the standard of living decreased in the period. Just over one-quarter of the households stated that the living standards have remained the same and a very small percentage (2, 8%) considered that the level of their standard of living has improved. This time, however, the percentage of households which consider that the level of their standard of living has decreased is higher in rural areas than in the case of the income decrease (71.2% compared to 67, 8%). This shows that some rural households consider that the level of their standard of living has worsened even if the revenues remained at the same level. The decrease of the living standards in 2011 compared with 2010 has been declared the most frequently by households in Giurgiu (79.4%), Mehedinţi (76,9%) and Calarasi (76,9%) counties, the lowest proportion of such households is registered in Olt (61,1%). 18

The households in the Bulgarian cross-border area appreciate more severe the changes in the standard of living during 2011 compared with the way in which they have described the evolution of revenues in the same period. And this is because the percentage of households which consider that the level of their standard of living decreased significantly is 27, 2%, while a drastic decrease of revenues was declared by only 16.4% of households. Also, the percentage of households which consider that the level of their standard of living had suffered a slight decrease is 33.2% (compared with 24.3% of all households who have stated that their incomes have slightly decreased in 2011). Finally, if half of all households in the Bulgarian border area consider that the incomes had stagnated at the same levels as in 2010, only 35.2% of the households believe that the living standards have remained the same compared to the previous year. This time, however, it seems that the standard of living in urban areas has undergone an evolution more evident than in rural areas: If for 4% of rural households, the living standards have remained the same, in urban areas this happens less frequently (32.9% of households). Also, the percentage of households who have undergone a slight deterioration in the standard of living is higher in urban areas (34.2%, compared with 31.5%). Graph 1.2 The distribution of households by the opinion concerning the evolution of the living standards in 2011 compared with 2010, by residential areas in the Bulgarian border area Total 4,4% Urban 5,1% Rural 3,0% 35,2% 60,4% 32,9% 62,0% 39,4% 57,6% a scazut aramas acelasi a crescut The considerable decrease in the standard of living is most frequently reported by the residents of the districts Razgrad (40.9%) and Silistra (32.3%); it is rarely stated in Pleven and Veliko Tarnovo (23% of total households in each of the 2 districts). For more than half of the households in the rural districts of Veliko Tarnovo and Montana, the living standards have stagnated in 2011. 19

Expectations regarding future evolution of revenues Evaluating the households in which regards the evolutions of the incomes in the Romanian border area is extremely cautious, since more than half of them believe that the incomes will decrease in 2012: households that consider that it will be a strong decrease of their incomes are about one-fifth of the total households in the area and one in three households believes it will decrease slightly. Two out of five households believe the income will remain at the same level as in 2011. Pessimism is manifested especially in rural areas, the percentage of households which consider that their income will decrease in 2012 compared with 2011 being higher in rural areas than in the urban Romanian border area (26.6% vs. 19%). As in the case of the evolution evaluation of the past incomes, a small percentage of households considered that their incomes will increase in 2012, only 5% of total households. By counties, the highest percentage of households which consider that there will be a decrease of incomes in 2012 is registered in Giurgiu (71, 5%), followed by Calarasi (66.2%) and Mehedinţi (65, 7%). In Dolj County, there are fewer households that consider that in the following period the incomes will decrease (47.3%). Instead, Giurgiu County registered the highest percentage of households where there is a slight increase in incomes in 2012 (44%), while only a quarter of the Dolj county households consider this thing. The most optimistic households are those of Calarasi and Mehedinţi counties, of which a percentage of 6.4% and 6.7% respectively believe that the incomes will increase in 2012. Graph 1.3 The distribution of households by their opinion regarding the income evolution, by counties, in the Romanian border area Olt Dolj Giurgiu Constanta 0% 20% 40% 60% 80% 100% va scadea va ramane acelasi va creste Will decrease. will remain the same. Will increase And with regard to future incomes evolutions we can conclude different opinions of the Bulgarian population from the cross-border area, compared to the Romanians, in the sense 20

that the majority of households are expecting that the incomes will maintain in 2012 at the same levels as in 2011. If 7 out of ten households in Pleven districts consider that in 2011, the incomes remained the same, just over a third of the households in Razgrad district agree, the households in the district being the most pessimistic (36.5% of them saying they expect drastic income decreases). Table 1.6 Percentage of households by their opinion on future evolutions of the incomes in the crossborder Romanian-Bulgarian region - % - Cross-border area Romanian Bulgarian Will decrease very much 22,9 14,5 Will decrease a little 33,2 20,2 Will remain the same 38,8 55,2 Will increase a little 4,9 9,6 Will increase very much 0,2 0,5 One in five households in the whole Bulgarian area considers that its income will decrease slightly and 15% of them consider that there will be significantly decreases in the level of income. A household of 10 believes that its revenues will increase, the highest shares being recorded among urban households of Dobrich (15.1), Vidin (15.0%) and Vratsa (13, 9%). Graph 1.4 The distribution of households by the income evolution, by districts, in the Bulgarian cross-border Vratsa Veliko Tarnovo Ruse Pleven region Dobrich 0% 20% 40% 60% 80% 100% va scadea va ramane acelasi va creste There are no large discrepancies between the opinions of the inhabitants in the urban areas, compared to those in the rural areas. The only differences that can be highlighted between the cross-border area residential areas are those which concern the shares higher by 5 percentage points of the rural households in the Bulgarian area who believe that the incomes will remain the same, and the higher frequency of urban households among those who believe that in 2012 will receive higher incomes compared to those of 2011. 21

In the rural areas of the Bulgarian border region, there is a variation of the shares of households who consider that the level of their standard of living would not suffer changes: 82% of households in Pleven and Veliko Tarnovo districts, compared to Montana and reaching 33.5% of households in Razgrad. Coverage degree of current expenditures from the households incomes Moving to an evaluation of the degree of coverage of current expenditures in the total net income available to each household, it appears that in the Romanian border area, the households experience quite frequently difficulties in covering all the expenditures from incomes. There is a 30% share of households whose income covers the current expenditures and a minority of 14 percent of the total households for which the income cover to a large extent, most of the expenditures but face with restrictions. Thus, two of the five households consider that the revenues cover the current expenditures in small or very small proportion, and one of 6 households consider that the incomes do not cover at all current expenditures. The situation seems to be more serious in rural areas, where the percentage of households that consider that the income cover in small or very small extent the expenditures is of 43, 4% (compared with 36.1% in the urban areas), while the share of those who appreciate that the revenues do not cover the current expenditures 20.4% (compared with 13.4% in urban areas). Among the counties in which more than half of rural households consider that revenues do not cover entirely their current expenditures or coner in small measure we include Calarasi and Olt counties. The situation seems to be easier in Constanţa, where a quarter of rural households have declared that the income is sufficient to cover expenditures and 32% of them consider that the incomes cover in a great measure the household's necessities. Graph 1.5 The distribution of households by the coverage degree of current expenditures from the total net income, in the Romanian counties of the cross-border area 100% 80% 60% 40% 20% 0% Constanta Calarasi Giurgiu Teleorman Dolj Mehedinti Olt in mare sau foarte mare masura suficient in mica sau foarte mica masura deloc To a great extent sufficiently to a less extent not at all 22

Analyzing the opinions of the households in the Bulgarian cross-border area, the situation is difficult. Almost a third of the households considered that the incomes are sufficient to cover current expenditures of the members of the household. Alarming is the fact that two out of five households declare that their revenues only cover to a less extent the expenditures, and a quarter of the households declare that income does not cover the expenditures at all. The most affected by this phenomenon are the households in Razgrad (40, 0%) and those of Dobrich and Vidin (32% of the households in each district). Table 1.7 Percentage of households by their opinion on the coverage of current expenditures by the total net income, in the Romanian-Bulgarian cross-border region - % - Cross-border area Romanian Bulgarian Covers to a great extent 14,2 3,3 Sufficiently 29,2 31,2 Covers to a less extent 39,7 41,0 Does not cover at all 16,9 24,5 The households in Veliko Tarnovo, Vratsa and Montana districts declare more frequently than those in other districts that the income is sufficient to cover current expenditures (about 36% of households in each district). At the opposite pole are the inhabitants in Razgrad districts, who appreciate that it is in a similar situation in a much smaller proportion of 23,6%. Table 1.8 The distribution of households by the opinions concerning the coverage of current expenditures by the total net incomes, by residential areas and districts in the Bulgarian cross-border area - % - Total Bulgarian area/districts Veliko area Dobrich Montana Pleven Razgrad Ruse Silistra Tarnovo Vidin Vratsa URBAN Covers to a great extent 4,3 4,9 3,6 2,7 0,6 4,2 4,5 4,2 7,4 7,2 Sufficiently 35,6 38,5 33,2 33,8 32,0 32,1 34,8 35,7 38,6 43,4 Covers to a less extent 38,8 36,1 42,8 41,5 33,7 39,8 46,5 39,8 32,8 32,8 Does not cover at all 21,3 20,5 20,4 22,0 33,7 23,9 14,2 20,3 21,2 16,6 RURAL Covers to a great extent 1,6 1,2 1,2 0,4 5,0 2,3 3,1 0,4 0,0 0,5 Sufficiently 23,2 15,4 39,1 16,9 16,6 21,2 22,2 38,1 8,2 25,4 Covers to a less extent 45,0 24,2 49,1 58,1 33,2 44,7 56,7 47,2 39,1 43,6 Does not cover at all 30,2 59,2 10,6 24,6 45,2 31,8 18,0 14,3 52,7 30,5 23

The situation is even worse in rural areas, where the percentage of households who declare that the revenues do not cover the current expenditures increased to 30, 2% (compared to 21, 3% in the urban area), and those that consider that the incomes cover the expenditures to a less extent is of 45% (compared with 38.8% in the urban area). A quarter of the households in rural areas consider that the incomes are sufficient to cover the expenditures and a very small percentage (1.6%) declared that the incomes exceed the expenditures. If one tenth of households in the rural area in Montana and 14.3% of those in Veliko Tarnovo district are in this difficult situation, the phenomenon is much more frequent among the rural households in Dobrich (59.2%), Vidin (52,7%), Razgrad districts (45,2%). Expectations regarding the future evolution of the standard of living The assessment of future standards of living can offer clues to the population perception on the social-economic situation. Assessments made on the incomes and living standard in 2011 amplifies the pessimism, so the perspectives for the near future are positive rather than negative. A quarter of households in the Romanian border area believe that the living standards will decrease in 2012 and over a third considered it will be a slight decrease. Another third of the households believe that the living standards will remain at the same level and only 4.5 percent expect it to increase. In rural areas, the share of households providing an evolution of the standard of living is higher than in urban areas (66, 8% compared to 57, 4%). By counties, in Calarasi is registered the largest share of households which consider that the level of their standard of living will decrease (37, 8%), while only 15.8% in Teleorman agree. In the latter County, it is registered the largest share (40.1%), after Dolj (46,6%) of the households who think their standard of living will not register significant changes. And among the households in Giurgiu, there is a major uncertainty regarding future income, since half of the households in the County believe that the living standards will slightly decrease and almost 20% of them think that it will be maintained at the same level as in 2011. The smallest proportion of the households which estimated that the living standards will be maintained unchanged in 2011 are in Giurgiu, Calarasi and Mehedinţi. We must note the fact that in Calarasi County about half of rural households believe their standard of living will decrease significantly, while among the urban households, this opinion is shared by 22.7% of the households. Instead, 40.7% of the urban households believe that the living standards will decrease slightly, to a percentage of 29.0% of total rural households. 24