Bulgaria Rightists Propose Formal State Debt Register

Bulgaria's right-wing leader Ivan Kostov (front) disapproves of drastic anti-crisis measures. Photo by BGNES

A central register showing all debts owed by the state to private companies should be created in order to ease the economic situation, the rightist Blue Coalition has suggested.

Ivan Kostov, Co-Chair of the Blue Coalition, which supports the government of the ruling GERB party, has spoken in favor of creating a register specifying the exact amounts of money owed by the state to private businesses, and the deadlines for payment.

In this way, the state will largely improve the tense situation because it will provide the companies with documents that they can use before the banks from which they themselves had borrowed.

Kostov said the Bulgarian state had recognized debts to private firms for public procurement orders amounting to BGN 700 M but the actual amount was probably around BGN 1,3 B.

The Borisov government delayed paying the private businesses at the end of the 2009 in order to avoid going to a large budget deficit as it is applying for the ERM II, the Eurozone waiting room. It started to pay out to firms at the beginning of 2010 but first only to those companies that would give up 10% of their claims.

Speaking on the BNT Wednesday, the rightist leader Ivan Kostov declared himself against drastic anti-crisis measures that would lead to the scrapping of a number of social benefits such reducing paid maternity leaves. This statement has come in the wake of alerts raised by Bulgarian trade unions that the government’s new anti-crisis measures package is going to affect seriously the social situation of the population.

Kostov has warned that such measures, if adopted, might be received rather negatively.

He has described the situation in Bulgaria as ”worrying” because the crisis is still raging, and is leading to a drop of the income of private companies, rising inter-company debt, and non-performing loans.

He believes, however, that one of the most positive things currenly going on is the debate of the various measures which can be adopted. In his words, this debate should have started in the summer of 2008.

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