27.01.2012

DEAR PRESIDENT,

MEMBERS OF PARLIAMENT,

PRIME MINISTER, MINISTERS,

On 16 January 2012 I dispatched a letter to my colleagues, the ministers of finance of the other EU Member States that are not part of the euro area. Therein, we laid down our views on three issues and we requested joint action of the ten members outside the euro area in order to defend those views:

Firstly, we support the conditions for enhanced fiscal governance provided for in Chapter III of the draft Agreement. We are for the inclusion of clear rules for budgetary austerity in the national laws of each EU Member State.

Secondly, we have requested that Chapter IV be excluded from the discussions until it becomes clear what "common economic policy" means and what "coordination" and "convergence" mean. We have definitely insisted on not making reference to the Euro Plus Pact.

Thirdly, we have insisted on the right of the states outside the monetary union to have active observers in the euro are summits.

Those three issues are matters of principle. We have defended them in the talks before writing this letter. We are satisfied with what has been achieved so far, because our proposals were reflected in the new wording of the draft Agreement.

In the latest ECOFIN meeting this Tuesday we supported the idea for infringement procedures against the countries that do not maintain budgetary discipline. We requested the introduction of a similar sanction for the states with excessive public debt.

Let me summarize. A year ago, here in Parliament, we launched the discussions of the Financial Stability Pact we had proposed. As a result, a 2% deficit ceiling and 40% government expenditure cap were laid down in the Organic Budget Law of the Republic of Bulgaria. We met those conditions even in 2011, although as from the beginning of this year we are obliged to stick to this rule by law. We want that every EU Member State introduce clear fiscal discipline rules in their national laws.

We shall not support or take part in common agreements presupposing future alignment of tax policies. Setting direct taxes is a matter of national character and Bulgaria decides it by virtue of laws passed by its National Assembly.

We are not a party to the European Stability Mechanism. We will not take part therein. Let me remind you that we similarly voiced a clear view of Bulgaria's non-participation in the complementary IMF programmes. This was already taken into account and the procedure there continues without us and several other states outside the euro area.

As to the issue of the future joining of our country to the euro area, there are explicit criteria. There is no reason paying an entry fee in advance, and this is no longer the case thanks to our proposals. We do not infringe the solidarity principles in this way. For solidarity means, first, to protect the interests of Bulgarian citizens, and second, to abide by the common European Maastricht Treaty. We do both.

THANK YOU!