Bulgaria’s Finance Minister Vladislav Goranov has insisted that the new borrowing of up to BGN 16 B is inevitable.

Goranov spoke for 45 minutes in Parliament on Wednesday during the debates on the Dealer Agreement between Bulgaria and the four banks selected as agents for a mid-term bond program by end-2017 worth EUR 8 billion, Citigroup Global Markets Limited, HSBC Bank Plc, Societe Generale, and UniCredit Bank AG.

The Agreement was signed on February 6.

Goranov claimed Wednesday that Bulgaria had been living on borrowed money since 2009, according to reports of money.bg.

He suggested that the country had failed to stick to the principle of spending as much as it was earning and it was now time to pay the debts.

Goranov suggested that the second government of Prime Minister Boyko Borisov had to foot the bill.

The Finance Minister argued that Bulgaria had to pay back a total of BGN 12 B that had already been spent by end-2017.

“As long as the budget is plagued by a deficit, there will be debt too. I can easily come up with measures that will bring the deficit down to zero, but I seriously doubt it that you would like them,” he stated.

Goranov noted that the bridge loan of BGN 3 B that had been used to pay guaranteed deposits of up to BGN 196 000 at the Corporate Commercial Bank (KTB, Corpbank) had to be repaid in May or, if postponed, in October.

He said that the disposable resources of the government amounted to BGN 5.8 B by February 19, 2015, including the resources of the Silver Fund, a state retirement fund, the nuclear funds, and a deposit at the First Investment Bank of BGN 800 M.

“A country with a budget of BGN 31 B ended up with resources worth half a billion, which is a problem,” he stressed.

Bulgaria's Finance Minister told MPs that the fiscal reserve amounted to slightly over BGN 5 B, adding that the government had access to a mere BGN 500 M of the total, the remainder being stored at the Silver Fund, the nuclear funds and at the First Investment Bank.

Goranov said that expenditure overruns of BGN 2.5 B had been approved through the adoption of the 2015 state budget.

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