Bulgaria's economy is threatened to nosedive into a new wave of the crisis, bringing about a Greek-like debacle, unless the government takes urgent measures, right-wing politicians and analysts have warned.

“We see the government taking chaotic steps, triggered by panic, without a clear concept for tackling the crisis. If the government sticks to this line, we are heading for a new wave of the crisis,” Martin Dimitrov, leader of the biggest right-wing party in Bulgaria UDF, said, as he presented its anti-crisis program.

The program includes drastic cuts in the budget expenses and update of the budget, halting the nuclear power plant Belene project, reduction of the social securities and enticements for the companies, which create and keep jobs, e-government, e-payment and administrative reforms.

Dimitrov strongly criticized the government approval of a 2 percentage-point rise in health insurance levies on which it says will raise BGN 300 M for the ailing health system.

"Instead of lightening the social securities burden, the government is doing exactly the opposite,” Dimitrov said, adding that his party will vote against the tax hike in parliament.

“With its promises to the protesting doctors, the government is pushing Bulgaria towards the Greek crisis scenario,” Georgi Angelov, Senior Economist at the Open Society Institute Sofia, commented. “Neither Germany, nor France will be in any rush to rescue us because we are not even in the eurozone,” he added.

Bozhidar Danev, Bulgarian Industrial Association (BIA) Chairman, pointed out that nearly 1500 companies have already gone bankrupt.

“It is clear that the budget is a failure. All illusions about additional revenues and excise duties have proved wrong. There is a real danger that the economic crisis in Bulgaria will turn into a financial one,” Danev said.

According to him Bulgaria will not manage to accede to the eurozone prior to 2015.

Bulgaria is believed to be among the countries most at risk from potential spillovers from Greece after banks invested in central and eastern Europe. The country is more susceptible to contagion risk from than neighboring Romania or Turkey, because Greek banks control 28 percent of the Balkan country’s market.

Bulgaria, which joined the EU in 2007, posted the smallest budget deficit among the 27 member states last year, according to the finance ministry. It is expected to be the only EU nation to balance its budget in 2010.

Countries must be members of the eurozone waiting room ERM II for two years before they can formally join the eurozone.

Bulgaria's center-right government believes that the country could be ready for euro entry by 2013.

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