Bulgaria is facing the real possibility of entering the new year without an adopted state budget and remaining in this mode at least until June if the country goes to early parliamentary elections. This was stated by economist Adrian Nikolov from the Institute for Market Economics and financier Levon Hampartzumyan on bTV.
According to both, the state will not "get stuck", but will function on autopilot - without clear political leadership and without strategic decisions. Nikolov emphasized that with elections in late February or early March, followed by negotiations for a government, the realistic horizon for a new budget is June. Until then, the country will operate with a rolling budget.
The economist explained that the lack of a new budget in itself is not unprecedented and does not mean a financial crisis, since the state has mechanisms for short-term financing. According to him, the greater risk comes from the automatic mechanisms for increasing spending, laid down in various laws - including the increase in salaries in the public sector and pensions.
Nikolov warned that if the parliament does not adopt a rolling budget that explicitly blocks these automatic mechanisms, imbalances will result - an increase in spending without clear coverage, and investment projects will be the easiest to cut. At the same time, there will be resources for the Ministry of Internal Affairs and Defense, but not for other sectors such as culture, healthcare and statistics, which could lead to social tension and protests.
Levon Hampartzumyan emphasized the institutional problem, not the budget itself. According to him, even with a change of government, clientelistic networks, contracts and regulatory bodies with expired mandates remain and continue to maintain the status quo. He pointed out that protests are an indicator of problems, but are not a tool for solving them - this can only be done through institutional reforms.
The two also commented on the effect on business. According to Nikolov, companies that do not depend on public procurement will be placed in a state of uncertainty - without clarity about future tax policy, regulations and social security burden. This will postpone investment decisions by both foreign and local investors and may lead to the export of capital to more predictable markets.
Regarding inflation and prices, both were categorical that the lack of a new budget in itself will not lead to a sharp price spike. The main inflation risk, according to them, comes from the administrative increase in income without a corresponding increase in productivity, as well as from weak control and competition in the market.
Adrian Nikolov and Levon Hampartzumyan united around the thesis that the biggest problem facing the country is not the temporary lack of budget, but the ongoing political and institutional instability, which undermines trust in the state and slows down economic development.