23.05.2018

Today the European Commission published a proposal for a Council Recommendation on the updated 2018 National Reform Programme and delivering a Council Opinion on the Convergence Programme (2018 – 2021) of the Republic of Bulgaria within the so-called “European Semester”. These are to be reviewed and approved by the ECOFIN Council on 22 June 2018 and to be finally adopted by the European Council at its meeting on 28-29 June 2018.

The European Commission assesses positively the efforts of the country to address the 2017 recommendations as a result of which Bulgaria has been de-escalated by one category under the Macroeconomic Imbalances Procedure. It has three recommendations for 2018, one less than in 2017. These again cover the areas of fiscal policy, financial sector, insolvency framework, social protection system, education and healthcare.

In the area of fiscal policy, the Commission recommends the government to continue improving tax collection and the efficiency of public spending, including by reducing the extent of the informal economy and upgrading the state owned enterprise corporate governance framework.

The European Commission recognizes the achievements in the financial sector and recommends the government to proceed with the performance of the measures resulting from the reviews, to implement the action plans in order to strengthen the oversight and to ensure adequate valuation of assets. The Commission reiterates its recommendation for the insolvency framework as well as for promotion of a functioning secondary market for non-performing loans.

The third recommendation keeps the focus on the social aspects targeted mainly at disadvantaged groups. The Commission recognizes the progress on the labour market and recommends the country to improve the quality and access to education and health services as well as to revise the scope and adequacy of the guaranteed minimum income.

Overall, the European Commission believes that the effective implementation of the measures under the 2018 National Reform Programme would underpin the correction of imbalances. The government is also to take additional actions in response to the 2018 country-specific recommendations.