EBRD urges Bulgaria to maintain fiscal discipline, improve business environment
Key priorities for Bulgaria in 2012 should include maintaining fiscal discipline, the European Bank for Reconstruction and Development (EBRD) said in its Transition 2011 report. "Successive governments have pursued over the years strong fiscal discipline and it is vital that this is maintained, particularly given the strong commitment to maintaining the currency board," the EBRD said. A timely implementation of the Fiscal Stability Pact and further progress on key structural reforms to the health care and pension systems would further support this, the report said. Another key priority for 2012, according to the EBRD, was for Bulgaria to make further progress towards increasing energy tariffs and improving the predictability of the process of deciding tariffs. "Regulated prices have been used to cross-subsidise certain groups (primarily retail buyers) and to keep prices below long-term sustainable levels; reversing this practice would lead to higher investment and a more effective operation of the market." Business environment improvements were needed, the EBRD said. Surveys showed that problems persisted with regard to obtaining construction permits and trading across borders, two areas where Bulgaria's authorities should push reforms and align legislation with EU standards, the report said. Summarising what it described as the highlights of the past year for Bulgaria, the EBRD said that growth had returned to the economy, combined with improved ?scal discipline. After barely positive growth in 2010, the outlook for 2011 is improved, the EBRD said. "In parallel, the government has made important spending cuts in the public sector and has introduced new rules, endorsed by parliament, to limit spending and de?cit levels in the future." Progress was being made in using European Union (EU) funds, the report said. The rate of absorption of EU structural and cohesion funds accelerated from a low level, and measures were being implemented to further increase technical and administrative capacities. A more commercial approach to some transport infrastructure was being introduced, the EBRD said. Concessions have been developed in the port and aviation sectors. "Their successful implementation would help to bring much-needed ?nance to further upgrade these sectors, but will depend on signing term agreements with high-quality owner/operators," the EBRD said. (Source: The Sofia Echo)