Bulgaria’s National Assembly gave final approval, in a vote on June 5, to a bond issue of 1.493 billion euro on international markets.
The vote in the National Assembly was 108 to 38 with four abstentions.
According to the current government, the debt will be used to refinance a global bond issue that matures in 2015, another old debt that matures in 2014 and the planned budget deficit.
The issue has been deeply controversial amid claims by centre-right opposition GERB that the government is increasingly sinking Bulgaria in a dangerous deficit position and was being vague about the purposes of its borrowing.
The Bulgarian Socialist Party, current holder of the mandate to govern, has responded that taking on debt of this kind is a normal operation carried out in all countries.
Bulgaria’s state debt is reported as being 18.6 per cent of GDP.
The parliamentary vote ratified a recommendation by the cabinet on May 21 on the signing of a subscription agreement with Citigroup Global Markets Ltd, HSBC Bank plc and Bank of New York Mellon (Luxembourg) CA. The contract governs the relationship between the state and the banks in the issuance of the bonds.
(Photo: M van den Dobbelsteen/sxc.hu)