Bulgaria is already in a situation where the accumulated problems in public finances are starting to be felt more and more.
According to economist Levon Hampartzumyan, the country is gradually losing the buffers that in the past allowed for easier crisis management.
"Unfortunately, most of the buffers that governments have have already been used up. There is something else too - in good years, and we understand that we have lived in good years, this is evident when they end. In good years, economic growth usually covers managerial mistakes in politics and in the corporate world," the expert commented in the studio of "Denyat ON AIR".
Geopolitical uncertainty and difficult decisions
According to him, the global situation, geopolitical tensions, the war in Ukraine and the unpredictable decisions of major world players make governance significantly more difficult.
In this context, he sees making rational and pragmatic decisions as key, since the possibilities for mistakes are already severely limited.
Corruption, taxes and budget "holes"
Hampartsumyan drew attention to the fact that before thinking about raising taxes, it is necessary to limit the serious leaks in the system.
"Corruption money is a tax on all of us, only a tax for private benefit. It goes into the hands of some people who organize the corruption scheme and does not enter the public finances. So raising taxes before you have plugged a significant part of these holes is an extremely wrong policy," the economist told Bulgaria ON AIR.
Efficiency, administration and reforms
On the other hand, he warned that relying solely on loans is not a sustainable solution.
In the short term, the markets still finance the country, but in the presence of structural problems in the economy, there inevitably comes a point when confidence decreases, interest rates increase, and access to financing becomes difficult.
"We have problems - bloated and very inefficient administration. The structure of the economy still produces things that are not high-tech," Hampartzumyan noted.
He stressed that reindustrialization cannot happen without well-educated and prepared personnel. If the country relies solely on foreign companies to import technologies, the profits will also flow abroad.
According to him, the key to improvement is the systematic measurement of efficiency - both of institutions and public spending.
He gave examples of infrastructure and road safety, where numerous institutions operate, but the results remain unsatisfactory.
According to him, if efficiency is monitored realistically, the areas with the greatest corruption potential will also be identified.
Hampartzumyan believes that the fight against corruption should not be waged only through punishments, but by limiting the conditions that make it possible - through transparency, digitalization and clear procedures.