Bulgaria's admission to the eurozone remains for now the anchor that stabilizes the complex coalition boat. And this is an important anchor not only for the coalition, but also for Bulgaria - because it is a matter of security in the coming times.
Comment from Daniel Smilov:
The "Zhelyazkov" government has already survived a month and a half - time that is sufficient for preliminary assessments of its effectiveness and its character. The very fact that Bulgaria has acquired a regular government had a calming effect on the people and they gave it an initial (fragile) credit of trust. What happened since its election:
Time for a first assessment
1. The most important and strategic decision of the new government was the request for a convergence report on Bulgaria's entry into the eurozone. With some delay and rhetorical zigzags, this report was requested, which is a good step and gives hope that the stated goal - entry into the eurozone - will be realized in early 2026. In the current situation, membership in the eurozone is not only an economic issue. It is not even so much an economic issue as a security issue - Bulgaria must be firmly integrated into the EU due to the looming uncertain times from a geopolitical point of view;
2. Mainly because of GERB, the country has not yet adopted three relatively simple anti-corruption laws, which are the direct reason for the delay in the second tranche of the PPA. As a result of the postponement of this legislation for more than a year, 600 million euros will probably be irretrievably lost - a huge sum that must be unequivocally credited to GERB and partly to the new government. Attempts to justify the commitments in the energy sector under the PPA are inappropriate. First, the three anti-corruption laws had to be adopted regardless of what is happening in the energy sector - they are a condition without which the money cannot be released. Second, GERB and its partners do not like the commitments made under the PPA in the energy sector, but they do not have an alternative plan for it. If the PPA money is not spent, Bulgaria will not only lose European funding, but will have to make commitments to support loss-making coal-fired power plants for years. Hopes that the rules in the EU will be renegotiated and coal will become profitable again are, at least for now, groundless. At the very least, the development of alternative energy technologies leads to this unprofitability and the process is quite one-sided. "The Plan" GERB's goal is clearly to bury our heads in the sand and subsidize the power plants in order to ensure temporary government peace;
3. The debate about the "18 billion hole" in the budget has taken up most of the time and energy of the ruling and opposition parties in recent weeks. This debate was and is pointless, because there is no such hole and there has never been one. The real problem for GERB, however, is that the legislative increase in pensions and salaries in recent years has proportionally reduced the money that can be allocated for client expenses of companies and municipalities close to the government. Due to the increase in GDP and now this money is a lot, but it is clearly less than what GERB promised, and here we must also put Peevski's "New Beginning" into the account. So the "18 billion hole" in fact, it is actually expressed in the big clientelistic mouth that was opened in anticipation of the resumption of the familiar management model - "Borisov-Peevski". The new management, instead of asking its clients to shut up their claims, actually decided to cheat. A budget was submitted in which some of the biggest appetites were cut in order to get within the 3% deficit and 40% budget to GDP. But the cheating happened in three directions. First, 40% of GDP in the new budget does not include European funding, which is practically an increase in redistribution through the state. Assen Vassilev is not to blame for this - during his time, European funds were included in the calculations as they should be. Second, and more importantly, additional loans will be taken - more than 6 billion, with which the capital of state-owned companies (BEH, the Development Bank and many others) will be raised. In this way, clientelistic appetites will be satisfied in a roundabout way. Third, the budget also included unrealistic revenues, such as a 30% increase in VAT revenues. That is, GERB is trying to both leave the euro lamb whole and feed its clientelistic wolf. Even the whole pack. This is, of course, a wrong strategy that has nothing to do with their request for "consolidation" of the budget. True, the stupid thesis about the "18 billion hole" has disappeared, but it is being replaced by a real multi-billion clientelistic extravaganza;
4. The government began its term in a very comfortable situation from a purely political point of view. Four parties (GERB, BSP, ITN and DPS-DPS) entered it. There was also one opposition formation - PP-DB. The paradox here was that the program of PP-DB largely coincided with that of the ruling party, because DB participated in writing the governing agreement and developing its priorities. There were also two parties - "Vazrazhdane" and "New Beginning" (and to some extent also "Mech"), which were more of an opposition to the PP-DB opposition. And indeed, Peevski and Kostadinov have spoken much more against PP-DB than against Borisov and GERB. This does not automatically make them part of the government, but it still shows that their status is special. This is largely valid at the moment, but the stance of "Vazrazhdane" firmly against the euro and their protest rallies changed the picture. It is clear that "Vazrazhdane" want to use deliberate violence - in and outside the parliament, to mobilize their electorate and become a second force. It is also clear that GERB can no longer play the theater of silent support for the "opposition of the opposition". This spoils GERB's comfort and we will see how the potential conflict between them and "Vazrazhdane" will develop. If in Germany or Austria the far-right had entered the government, Borisov would have been more flexible towards "colleagues" from "Vazrazhdane". But, alas, his flexibility will have to be postponed;
5. Appointments to the regulators, Constitutional Court and Supreme Judicial Council will actually be the real test of the role of Delyan Peevski and "New Beginning" in the government. The delay in the appointments of deputy ministers is actually a curtsy to Peevski - this is how the status quo is maintained, which is very convenient for him. The candidates under consideration for the CPC and other regulators - Rosen Karadimov in particular - were publicly criticized by the PP-DB and the MRF-DPS as nominations that would please Peevski. The MRF-DPS got nervous about the whole situation and began threatening to withdraw their support. In the short term, this is emerging as a risk for the "Zhelyazkov" government. It is not ruled out that Borisov will succumb to pressure from "New Beginnings", try to guarantee EU membership by June and call for new elections after that.
The crisis has not been overcome
In summary, it must be said that unfortunately the crisis with fragile and unstable governments has not been overcome. We have a rather complicated coalition that is trying to achieve both strategically important goals and satisfy clientelistic appetites that it itself creates and incites. The model of governance of Borisov's governments cannot return, however. Times are different and GERB's political opponents are much stronger. In fact, GERB threw all its energy against PP-DB and thus managed to meaningfully weaken its most useful potential partner. At the same time, they refuse to break the tail of their corruption legacy - the failure to adopt extremely elementary legislation with some anti-corruption potential is the most shocking demonstration of this refusal. And the complicated relations with Peevski, who is supposedly not in government, and yet the decisions are always in his favor, are still the same. The new thing is that GERB's playing with "Vazrazhdane" seems unlikely to continue as before. But let's see.
Membership in the eurozone remains the anchor that stabilizes the complicated coalition boat for now. This is an important anchor not only for the coalition, but also for Bulgaria. But the ruling party should not think that the people will forgive them everything in the name of the euro. Nor that they will guarantee peace of mind by handing out money to their clients. Compromises and a balance of interests are inevitable.
Every government is based on how much people believe it is working for the common interest. The "Zhelyazkov" government is still in its early stages and enjoys due favor. But the clouds ahead are on the horizon and it is good for the new rulers to be aware of the problems they have already generated.
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This comment expresses the personal opinion of the author and may not coincide with the positions of the Bulgarian editorial office and the State Gazette as a whole.