Bulgaria's Rulers Project GDP of EUR 39 B in 2011

Finance | November 11, 2010, Thursday // 16:41|  views

Bulgaria's Finance Minister, Simeon Djankov, was proud that the 2011 state budget was adopted at first reading.Photo by BGNES

Bulgaria's 2011 State Budget Act has been adopted at first reading with the votes of the ruling party GERB and its ally, the nationalist party Ataka.

The opposition Bulgarian Socialist Party expressed their negative vote with red pages, saying "Boyko Borisov Missing in Action," protesting against the fact that Prime Minister Borisov did not show up for the Parliamentary debates.

The MPs from the ethnic Turkish party DPS also voted against the budget, while the right-wing Blue Coalition abstained, arguing that the State Budget Act does not provide for the necessary reforms in various spheres.

Thus, of the total of 202 MPs who voted – 130 supported the budget, 58 voted against and 14 abstained.

The 2011 state budget provides for state revenues of BGN 25,84 B and state spending of BGN 27,8 B, i.e. a deficit of a little under BGN 2 B, which is expected to be about 2,5% of the GDP.

The projected GDP in 2011 is BGN 77 B, or EUR 39.3 B, which means a GDP growth of 3.6%, a figure the opposition and other critics slammed as unrealistic.

After growing by more than 6% in 2004-2008, the Bulgarian economy shrank by 4.9% in 2009, and is expected register a growth around 0% in 2010.

"The state budget for 2011 follows the medium-term fiscal framework for the mandate of our government, which includes: first, stability of the currency board; second, low taxes for households and businesses, which will be the lowest in the EU as of January 1, 2011; third, redirecting of public spendings towards growth stimulation; fourth, implementation of the pension, health and administrative reforms; and fifth, maintaining of the amount of pensions and salaries in the public sector," Bulgaria's Finance Minister, Simeon Djankov, said.

In his words, the budget envisions expenses for the social sector amounting to 12,6% of the GDP. He also said that the budget provides money for the policies that would ensure decrease of unemployment.

According to the opposition Bulgarian Socialist Party (BSP), if the 2010 state budget was a "meatless pizza", next year's budget will be a bagel.

"The dough part of the bagel would be for GERB and Ataka, while the middle part of the bagel would go to the people. I think we are the only country that spends more money on tapping than on culture. But people give money for what they are interested in or for what they understand," Petar Korumbashev from BSP said.

His comment was in reference to Djankov's statement from November 2009 that presented the 2010 state budget as a pizza, which might be small and meatless because of the crisis but at least was real and well-apportioned.

The BSP leader, Sergey Stanishev, said that the budget was like the ice age for the social sector. In his words, for the first time in years there will not be Christmas pensions.

He added that between the first and second reading of the 2011 state budget, the Socialist-led Coalition for Bulgaria will prepare an alternative budget.

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Tags: 2011 state budget, state budget, Simeon Djankov, Petar Korumbashev, Sergey Stanishev, GERB, Ataka, BSP, Bulgarian Socialist Party, Coalition for Bulgaria


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