Public finances are under pressure from the point of view of the expenditure side. We must start reducing the deficit when we have a growing economy. This was said in the program "Face to Face" on BTV by the member of the Governing Council of the Bulgarian National Bank, Lyubomir Karimanski.
It is not normal for the deficit to increase in a growing economy. By the end of August, the deficit is about 4% of GDP or 5.215 billion leva more than last August. During this period, the deficit has increased by 210%, said Karimanski, adding that by the end of August, over 80% of the expenditures planned in the budget for the year had already been made.
There is still a lot of spending to be done, and if by the eighth month we have made 81% of the planned, by the end of the year it will certainly be over 100%. These expenditures come from the so-called snowball - expenses that are outside the budget, from individual specialized budgets, for example, the increase in salary expenses in the Ministry of Internal Affairs more than normal, the member of the BNB management indicated.
Revenues are not going as planned in the consolidated fiscal program. Revenues from VAT as an implementation this year are less by August this year than August last year. Revenues from aid and donations are even less. This year we also have higher inflation, especially after June. When inflation increases, it only has a positive impact on VAT revenues, i.e. especially for the last two months, inflation has helped VAT revenues, noted Lyubomir Karimanski.
Excluding the capital program, this budget does not provide for other buffers. We should have an increase in buffers when we have a growing economy, not increase spending. We should not always look at the budget, but at what policies a government will implement in order to accumulate wealth and have it distributed correctly between the individual sectors in the state and between social groups. I do not see that. We should say what policies this budget will be based on, what is the philosophy - I do not see them. The budget cannot fulfill any technical function on its own, what is important is what we implement as transformational policies, if a given sector is going to be reformed, what are we doing with the demographic sector, what is happening with the children's hospital. The problem is not in the budget itself, the problem is in the policies that are missing, said Karimanski.
He also commented on Bulgaria's entry into the eurozone from January 1, 2026.
The problem is not the transition from one currency to another, but the transition to an economy with higher added value, which we can export outside Bulgaria. This is the main problem that must be addressed, said the member of the BNB Board of Directors.
According to him, there is no difference between the debts withdrawn by the governments with Finance Minister Assen Vassilev and the current one, with Finance Minister Temenuzhka Petkova, since, according to Lyubomir Karimanski, the loans were not used for investments in the Bulgarian economy, as they should be.