Bulgaria In Need of Another $9.3Bln Loan to Pay Back Current Debt

Bulgarian Finance Minister Vladislav Goranov said that Bulgaria has to pay back a total of 12 billion Bulgarian levs by end of 2017, but the country has already spent the money.

MOSCOW (Sputnik) — Bulgaria needs to borrow up to 16 billion Bulgarian levs ($9.3 billion) in order to pay back the country’s current debt, Bulgarian Finance Minister Vladislav Goranov said on Wednesday.

The Finance Minister pointed out that Bulgaria has to pay back a total of 12 billion Bulgarian levs by end of 2017, but the country has already spent the money.

The Dealer Agreement between Bulgaria and four banks selected as agents for a mid-term bond program by the end of 2017 worth $9.3 billion — Citigroup Global Markets Limited, HSBC Bank Plc, Societe Generale, and UniCredit Bank AG – was signed on February 6.

“As long as the budget is plagued by a deficit, there will be debt too,” Goranov said in Parliament on Wednesday during debates on the Dealer Agreement, according to the local press.

Goranov claimed that Bulgaria had been living on borrowed money since 2009. He pointed out that now is the time to pay the debts since the country had failed to stick to the principle of spending as much as it was earning.

Bulgaria’s economic growth slowed in the fourth quarter of 2014, according to the National Statistical Institute. The national economy grew by only 1.2 percent year-on-year and by 0.3 percent on quarterly basis. The slowdown stems from shrinking investments and a weakening trade balance.

The expenditure overruns of 2.5 billion Bulgarian levs had been approved through the adoption of the 2015 state budget.