Bulgaria’s agreement with the International Monetary Fund was published on the website of the Bulgarian Finance Ministry.

The cabinet stresses that its key goal will be to achieve considerable increase of incomes, which are to reach 26% of the average per capita income in the EU member states.

A key point in the fiscal policy section is that the currency board mechanism is preserved. The cabinet plans ways to provide more aid to socially disadvantaged people, and to ensure effective incentives for investing in the private sector and creating new jobs.

The memorandum also points out the amendments to the tax legislation. It outlines the programme for public investment, particularly in the spheres connected with Bulgaria’s
accession to the EU, and the opportunities for using pre-accession funding to improve the transport infrastructure, environmental protection, farming, and development of
out-of-town areas.

The Cabinet states its plans to speed up structural reforms, cut down on spending in the non-productive sectors, as for instance, subsidies, and keep the share in the GDP of wages in the state-financed sector at its 2001 level.

Special attention is paid to work with local governments for financial rehabilitation of the municipalities.

The cabinet sets out its plans to continue with the reforms in the treasury so as to achieve better control in managing state spending and to strengthen the intermediary role of the banks which had been considerably reduced during the financial crisis in 1996-97.

The memorandum contains measures to stimulate the financial markets and step up supervision over the financial system.

"We are determined to complete the reform in the real economy by two years and to create a full-fledged market-oriented competitive economy," says the document.

It also lists the measures for completing the privatization in all sectors, for restructuring the energy sector and the state monopolies, including the Bulgarian Telecommunications Company, the Bulgarian State Railways, among others.

The memorandum focuses on the management of the state debt so asto reduce the share of the public debt in the GDP, on decreasing the portfolio risk, minimizing the roll-over risk, developing landmarks of the international and domestic capital markets and maintaining sufficient liquidity in the fiscal reserves.

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