In a recent interview with Bulgarian National Radio, financial analyst Svetozar Gledachev warned that without Bulgaria’s entry into the eurozone, politicians might be tempted to push for a change regarding the currency board. Gledachev described the situation as similar to a roller coaster ride, where financial irresponsibility led to increasing wages and borrowing, ultimately resulting in a shift away from the currency board. He emphasized that changing the currency board could be done with a simple majority in the National Assembly, making it a real risk that could make the population poorer.
Gledachev criticized the government’s current budget, stating that while it might not be popular, it was necessary for Bulgaria to eventually join the eurozone. He noted that the government’s formation was largely driven by this goal, particularly after a series of poorly received budgets. He also criticized the ongoing parliamentary scandals, suggesting that the debates were more about gaining political leverage for the next election than addressing the real issues facing the economy.
He pointed out that in Bulgaria, one worker generating GDP supported three others, and the incomes of those not contributing to production were increasing. While consumption was rising, Gledachev stressed that this did not translate into real wealth but rather an average standard of living. He noted that wage growth for the previous two years was 13.9% last year, with a 3% inflation rate, and 15% the year before that, but this was not enough to create significant wealth.
The financial analyst also warned about Bulgaria’s growing debt, with interest payments on the national debt exceeding 160 leva per person last year and projected to surpass 200 leva this year. In the industrial sector, there was a significant decline of over 10%, with some industries seeing declines of more than 30%. Gledachev also expressed concern about the global economy, stating that if tariffs in Europe were raised by 25%, Germany would be negatively affected, and by extension, Bulgaria would also suffer economically. (Novinite)