The procedure is initiated because the budget deficit is higher than the allowed threshold of 3 percent of gross domestic product. If the situation is not corrected, sanctions could eventually follow, such as reversing promised salary increases.
The new Bulgarian government warns that restoring the budget will require difficult choices. At the same time, various political parties are calling to reduce the budget deficit to around 3 percent for 2026. According to them, this is necessary to prevent further measures from Brussels.
Reform-minded
New Prime Minister Rumen Radev plays a central role in the debate about the financial situation. He presented his center-left coalition government as reform-minded, stating that authorities want to focus on restoring budgetary stability. Emphasis is also placed on the necessity to strengthen trust in public finances.
Promotion
Former President Radev stepped down earlier this year and founded his own political party, which in a recent election won nearly an absolute majority. He thereby ended years of instability and corruption in Bulgarian politics. He blamed the poor financial and economic situation in the country on corruption and cronyism. This year the country joined the eurozone. According to Radev, previous Bulgarian governments portrayed the financial position far too optimistically.
Corruption
At the same time, he promised that the government will maintain frequent contact with the European Commission. Brussels decided to release previously blocked funds from the Recovery and Resilience Facility after Radev committed to reforms. This again makes clear that European funding is closely linked to the implementation of agreed-upon changes.
An important part of those reforms concerns tackling corruption. Both the Bulgarian government and the European Commission emphasize the importance of new measures in this area. These include strengthening institutions responsible for fighting corruption and improving oversight of public administration.
EU Subsidy
Besides the budget problems, executing broader economic reforms is also high on the agenda. Bulgarian authorities want to make use of European support to implement changes they consider necessary for a more stable economy and better-functioning government.
According to European and Bulgarian representatives, political stability is of great importance in this regard. After years of political uncertainty, it is hoped that a stable government can accelerate the implementation of reforms and strengthen the country’s financial position.