EU Commissioner Urges Bulgaria to Persist in Deficit, Debt Reduction

Finance | October 14, 2011, Friday // 16:23|  views

EU Commissioner for Budget and Financial Planning Janusz Lewandowski (front) with Bulgarian Finance Minister Simeon Djankov (back) in Sofia. Photo by BGNES

Bulgaria should keep demonstrating its fiscal discipline and stable public finances to gain the advantages of euro zone membership, EU Commissioner for Budget and Financial Programming Janusz Lewandowski declared in Sofia.

"If Bulgaria keeps proving to be a state with stable public finances, it will be fully entitled to seek euro zone membership," Lewandowski stated at a joint news conference with Bulgarian Finance Minister Simeon Djankov.

The EU Commissioner pointed out that the bailout net of the euro zone is one of the benefits that it de facto offers to its members.

"This bailout cover hasn't been made explicit but it is applied, and if Bulgaria keeps demonstrating budget discipline, it will be able to seek the privileges granted to a lot less disciplined countries such as Greece," the Polish EU Commissioner declared during his visit in Sofia Friday.

"When evaluating budget indicators, this evaluation is also done in comparison with the others. In this respect, I can state that in comparison to the big picture, the economic forecast for Bulgaria is good. This is the most serious message that you can send," he added.

Lewandowski also said that for the next EU budget programming period – from 2014-2020 – Bulgaria will be entitled to receive at least as much EU money as it was entitled for the period 2007-2013, i.e. at least EUR 11 B, including operational and pre-accession program funding. However, for the time being, Bulgaria has absorbed no more than 10-15% of that amount.

"Bulgaria's absorption of EU funds is improving. It probably isn't improving as much as Commissioner Hahn and I expected but the trend is positive anyway," the EU Commissioner said in Sofia.

Bulgaria's Finance Minister Simeon Djankov in turn pointed that he expected to have a "balanced state budget" by 2013, while also allocating sufficient funds for welfare and social projects.

He reminded a fact also mentioned by Commissioner Lewandowski – that Bulgaria is one of the three EU countries out of 24 member states which had their "excessive deficit procedures", which was started by the European Commission in 2010, lifted after improvements in their fiscal position.

Djankov pointed out that Bulgaria's budget deficit declined from 4.7% in 2009 down to 3.2% in 2010. He believes that Bulgaria will most likely do better than the 2.5% budget deficit projected for 2011. In his words, the 2012 State Budget Act will most likely project a deficit below 1.5% of the GDP.

Bulgaria currently has the lowest budget deficit and public debt from among the countries in the Eastern part of the EU with the exception of Estonia.

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Tags: Janusz Lewandowski, EU Commissioner, EC, European Commission, budget deficit, public debt, debts, debt, debt crisis, debt crises, bailout fund, bailout, Simeon Djankov, finance minister, 2012 state budget, euro zone, Euro Area, greece, EU funds, absorption


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