Bulgaria PM: Balanced Budget, Eurozone Top Priorities

“I expect all members of parliament to work for the European development of Bulgaria,” Borisov said. Photo by BGNES

The maintenance of a balanced budget and efforts for preparing the country for accession to the euro-zone are the two top goals of the government.

“I expect all members of parliament to work for the European development of Bulgaria,” Prime Minister Borisov said in his speech at the National Parliament, which met on Wednesday for its first session after the winter recess.

He said he was aware there is still a lot of work to be done, but stressed the government's efforts to clamp down on the criminal underworld and on corruption in its public service.

Bulgaria joined the EU in 2007 and posted the smallest budget deficit among the 27 member states last year, according to the finance ministry. It is expected to be the only EU nation to balance its budget in 2010.

The country will apply by the end of January to join the exchange-rate mechanism, the two-year currency stability test prior to euro adoption, and seek to switch to the common currency in 2013.

Bulgaria initially planned to apply to join the exchange-rate mechanism in November, but delayed it until after all member states submit their convergence programs, which contains the mid-term goals of the fiscal policy.

Joining the exchange-rate mechanism would bring Bulgaria closer to the umbrella of the euro region and the protection of the European Central Bank and is conditional on whether the new government will succeed to restore Brussels trust.

The lev is already linked to the euro in a currency board that keeps the Bulgarian currency at 1.9558 to the euro. Joining the exchange-rate mechanism may allow the lev to fluctuate by as much as 15 % around a central band, though the central bank has said it will leave the lev tightly pegged to the euro through the duration of the two years.

Bulgaria's entry in the eurozone, initially scheduled for 2010, has been set back as it is conditional on continued fiscal prudence and lower inflation.

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