off-the-wire

UPDATE 1-Bulgaria's government to seek 3% GDP fiscal deficit in 2023

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Adds quote, background) SOFIA, Feb 23 (Reuters) - Bulgaria's interim government plans to propose a 2023 budget draft with a fiscal deficit of 3% of economic output to ensure the Balkan country meets fiscal stability criteria for joining the euro zone, Prime Minister Galab Donev said on Thursday. Bulgaria, rattled by political instability, is yet to have an approved budget bill for 2023 and has also delayed its target date for adopting the euro.


The interim government plans to file a budget draft once a new parliament is convened following an April 2 election, the country's fifth in two years.


Sofia, which has pegged its lev currency to the euro, ended 2022 with a fiscal shortfall of just under 3% of GDP on an accrued basis.


Interim Finance Minister Rositsa Velkova had previously
warned that the fiscal shortfall in 2023 may jump above 6% of GDP, twice the European Union's mandated ceiling.


"We will do everything possible to propose a budget draft that would be in line with the (EU) Maastricht criteria, meaning we would propose a budget with a deficit of 3%," Donev said at a news conference alongside European Commission Executive Vice President Valdis Dombrovskis.


High inflation and a failure to adopt some legal changes prompted Bulgaria last week to scrap its Jan. 1, 2024 euro entry target date. Officials hope the country could be


ready to join the euro zone in 2025.
(Reporting by Tsvetelia Tsolova; editing by Jason Hovet and Paul Simao)

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