IMF denies criticism of Bulgaria's Budget policies

IMF denies criticism of Bulgaria's Budget policies

International Monetary Fund mission chief for Bulgaria Bas Bakker rejected media reports that the Fund was critical of the performance of Bulgaria's Government in dealing with the Budget deficit.The reports were based on a statement by Bulgarian opposition party Order, Law and Justice, whose leader Yane Yanev met with Bakker. According to Yanev's statement, the Fund was concerned with Bulgaria's fiscal strategy and the fact that Bulgaria's Budget deficit would reach four per cent of gross domestic product (GDP), more than double the Government target of 1.8 per cent.Bakker himself reportedly said that the Cabinet was not showing any resolve to push ahead with structural reforms.But in a statement posted on the website of the IMF regional office for Romania and Bulgaria, Bakker said: "We did not say that the 2010 deficit would be almost four per cent of GDP. The almost four per cent figure refers to the 2009 deficit on an accrual basis. Last week, the Government announced that the 2009 deficit had been revised up to 3.7 per cent of GDP, and this is what the discussion referred to.""We did not say the fiscal strategy is risky. The concluding statement [of the IMF Article 4 review mission in March] noted that there were risks to the Government's cash deficit target of 0.7 per cent of GDP in 2010 - in particular revenue shortfalls and settlement of arrears.""At the time of the mission, in early March, we projected a deficit of 1.8 per cent of GDP. Since then, arrears have turned out higher and revenues have disappointed, but this will be in part offset by the new fiscal measures.""We did not criticise the Government. As is evident from the concluding statement, we agree with the Government on most issues.""We did not discuss the Staff Report, which will be discussed by the Executive Board of the IMF on May 5. We only discussed the concluding statement, which has already been published.""We listened to Mr. Yanev's strategy, but we neither endorsed nor criticised it."

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