Do you remember the little girl from Alice in Wonderland asking the Cheshire cat which way she ought to go from here? And he answers: That depends a good deal on where you want to get to. I don't much care where, Alice says. Then it doesn't matter which way you go, the Cheshire cat answers. So long as I get somewhere, Alice adds.

That is more or less the picture of Bulgaria’s economy – we don’t know where we want to go or what we want to achieve and so risk getting… somewhere. However, the government is optimistic it will find the way that will point Bulgaria in the right direction.

“I think the Bulgarian economy has, in recent years, been developing in the right direction,” says Deputy Prime Minister Daniela Bobeva. In her words, we do not appreciate the financial and economic stability in the country, but constantly criticize everything connected with the economy. Estonia, Ireland, Portugal were cited as models of development. “OK, but we survived the crisis – we preserved the fundaments of our stability, such as the currency board for example. We have not paid a single lev in outside financing for our banking system – so, we have no reason to be pessimistic,” comments the Deputy Prime Minister and Minister of Economy. However, financial and economic stability should not be taken for granted, Bobeva cautions, and keeping it from internal and external risks is a major success. Bulgaria continues to have some of the lowest taxes in the EU, despite the crisis and the considerable social expenditures. As to stability – facts speak for themselves. A low budget deficit, an 0.8 percent economic growth. So, things aren’t so bad after all,” Bobeva comments.

What are the problems and risks? First and foremost investments - their drop is a fact. The Bulgarian Investment Agency is working on 22 major investment projects worth around 1.7 billion leva. Even if a small portion of them were to be materialized that would mean additional growth for the Bulgarian economy. Domestic demand is also reduced because of the crisis.

“Despite the accusations that we have been making enormous social expenses we are not expecting any tangible rise in salaries or the incomes of the population,” Daniela Bobeva says. “The plans for a major growth of the corporate sector should go hand in hand with major exports.”

Another problem is productivity of labour. “Here we have a downward trend,” Bobeva stresses. The Deputy Prime Minister is hoping that the current conservative policy in the banking sector will be preserved and unfair competition curbed. The Bulgarian stock exchange will be privatized even though “some people won’t like it,” Daniela Bobeva goes on to say. “We are critical of the international financial institutions but Bulgarian business needs them and must show maximum flexibility,” she adds. Consumer protection is one of the most complex problems standing between business and the state. The government is promising a radical reform. The dialogue with the diplomatic missions is ongoing. “They are very active and that was a surprise to me as Deputy Prime Minister,” Daniela Bobeva says. In her words the crux is in sector policies – there are 211 strategies at this point, but “I don’t believe anyone has read them,” she adds.

“What we are witnessing is Bulgaria’s return to the path of growth in keeping financial stability,” comments on his part Yordan Tsonev, chair of the parliamentary budget and finance committee. Tsonev says Bulgaria’s interest lies first and foremost in getting the economy back on its feet.

“What Bulgaria needs are several serious, major investment projects,” Yordan Tsonev says. “And they are mostly in the sphere of power generation. Diversifying energy sources is a geopolitical issue and Bulgaria has few levers for exerting any influence here. But what we can do is diversify the channels via which we receive energy.”

English version: Milena Daynova