Ecofin Likely to Say Bulgaria Did Enough to Cut Deficit

A view of the European institutions buildings with the EU commission and EU council headquarters. Photo by EPA/BGNES

European Union finance ministers are expected to confirm at their meeting in Brussels, starting on February 14, that Bulgaria needs take no further steps to curb its budget deficit under the bloc's rules on government finances.

The ministers will also make an attempt to hammer out deals on an overhaul to the bloc's economic policy rules and a new emergency financing fund for the countries that use the euro. The meeting will be attended by Bulgaria's Finance Minister Simeon Djankov.

The European Union's executive said on January 27 that four countries, including Bulgaria, have been stricken off its deficit watch list as they have taken adequate steps to correct it.

"The Commission concluded that on the basis of currently available information Cyprus, Finland, Bulgaria and Denmark have taken action representing adequate progress toward the correction of the excessive deficit," it said in a statement.

"[For] these member states, no further steps in the excessive deficit procedure are needed at present," the EU's executive arm said in a brief statement.

The European Commission launched in July last year an excessive budget deficit procedure against Bulgaria and 24 other EU member-states to ensure that the countries reduce swiftly their state spending, and keep their budget deficit below 3% of the GDP.

At the end of April last year Bulgaria's Prime Minister Boyko Borisov and Finance Minister Simeon Djankov said the previous Socialist-led government had kept them in the dark over BGN 2.16 B contracts, which pushed the 2009 deficit up from a projected 1.9% to 3.7% of GDP

In the first of its twice-yearly reviews of government finances in the 27-member bloc, Eurostat said the Bulgarian government's budget deficit in 2009 was 3.9% of gross domestic product.

Prime Minister Boyko Borisov placed the blame squarely on the shoulders of the country's former Socialist-led administration, saying the government has lied to the EU colleagues about the country's readiness for the euro zone, being unaware of this trap.

The EU's stability and growth pact requires governments to maintain public deficits below 3% of gross domestic product.

We need your support so Novinite.com can keep delivering news and information about Bulgaria! Thank you!