"The government program should have included reforms that would return and balance things to normal. The entire financial world already knows that we are going downhill. There are no brakes in the political world and this is starting to shine like a yellow or red light for anyone who wants to do business with Bulgaria," said Fiscal Council member and former Deputy Minister of Finance Lyubomir Datsov to "Focus".
Instead of Bulgaria falling into an excessive deficit procedure, which seriously damages the country's international image, the government should have included the necessary reforms in its own program, the financier said.
In his words, the current cabinet has a clear mandate to balance the budget, since the state of public finances is one of the main reasons for being elected with a large majority.
Datsov believes that there is no significant difference whether the measures are imposed by Brussels or out of internal necessity, since the reforms are mandatory for our native "home".
He calculated that the country has a serious structural deficit of over 3%, accumulated from 2021-2022 due to the practice of spending more than the economy allows. To stabilize the treasury, it will be necessary to optimize nearly 3-4% of state spending, and according to him, the correction should be made only through cuts, not by raising taxes. Datsov explained that the rapid increase in debt is simply a consequence of these deficits and the problem will disappear automatically when the unnecessary spending is stopped.
The former Deputy Minister of Finance also sharply criticized the amendments to the Consumer Protection Act adopted on second reading in the committee, providing for "fair prices" for 20 basic goods.
"Apart from the shame of incompetence, there is no other effect. Nor can you slow down the growth of prices, because the factors are completely different. The main factor for the rise in prices in Bulgaria is the outpacing growth in incomes," the expert explained, referring to the jump of up to 25% in personnel costs in the budget sphere, adds "Focus".
According to him, these non-market measures are "a curtsy to the centrally planned economy", which will not stop inflation, but will only lead to bankruptcies of small and medium-sized enterprises, as was the experience in neighboring Greece.
Lyubomir Datsov called on the government to seek international consulting assistance from institutions such as the World Bank for the next 6 months, in which a stable reform plan must be developed.