July 6 (SeeNews) - Bulgarian right-of-centre opposition GERB party won Sunday's parliamentary elections on Sunday by a margin of more than 2-to-1 ahead of its main opponent, the ruling Socialists, an outcome largely seen by analysts as good news as it is expected to ensure political stability in the country.
GERB, founded in 2006 by Sofia mayor Boiko Borisov, will send to parliament 90 representatives elected from proportional party lists and a further 26 elected in direct majoritarian vote in the 240-seat Parliament. It won 39.7% of the proportional vote based on 99.88% of the ballots counted. Voter turnout was 60.2%
The ruling Bulgarian Socialist Party, BSP, which leads the outgoing three-party government coalition, came a distant second with 17.72% of the votes and will have 40 members of parliament.
Analyst comments follow:
TOTH GYULA, EASTERN EUROPE ECONOMIST AT CAIB/BANK AUSTRIA:
The outcome is not surprising and is in line with the previous polls, in terms of market impact or economic impact the key question is what is going to happen with the potential IMF deal, and how quickly they can reach agreement about a new coalition, so far the comments from the winner party are promising so this is all in all good news. Economy is not in a very good shape and this has an implication on the budget which has been in the plus in the last couple of years and there will be deterioration. I think the two issues [that the government should focus on first] are fiscal policy and potential IMF deal. Definitely it [IMF deal] is a helpful thing if you look at Romania or Hungary or other neighboring countries. IMF agreement has been able to stabilize the things in these countries, so I think it is not necessarily a bad thing.
DIMITAR CHOBANOV, MACROECONOMIST AT SOFIA-BASED THINK-TANK INSTITUTE FOR NEW ECONOMIC PROGRESS:
The good news is that a stable majority is expected. GERB will not have [an absolute] majority but with one or two coalition partners they will have enough to form a government relatively soon. […] There will be no a period of interregnum. […] So in terms of political stability it is good news and almost surely a political crisis will not be added to the economic crisis. […] What we’ve seen so far from GERB is that their policy will be centrist rather than rightist. The question is what will be the influence of their partners, most likely the Blue Coalition. […] What they said that they intend to do is a revision of the budget as a key priority and what can be expected is cost cuts. An important thing is what is the starting point when they enter office and whether it is the same as data in the Finance Ministry reports. In my view, the legacy is a balanced budget or at least a small [budget] surplus, so from this point of view the situation is not so unfavourable. The key issues they have to address are this year's budget performance and the preparation of the new budget. […] Probably they will want to make some changes. I am also waiting [to see] what concrete measures they will propose for tackling the crisis because so far their proposals were not so specific. A potential IMF deal will have both positive and negative effects. […] I don’t think that Bulgaria will be able to qualify for a flexible credit line from IMF. And if it does not qualify, IMF will set conditions for signing such an agreement and Bulgaria will be subject to comprehensive monitoring and the country will be forced to accept some clauses which are not so urgent and not so favourable.
KRASSEN STANCHEV, BOARD CHAIRMAN OF SOFIA-BASED INDEPENDENT THINK-TANK INSTITUTE FOR MARKET ECONOMICS:
There will be one major party which means an easier implementation of political will, contrary to the situation with the outgoing tripartite coalition. […] So it is a relatively good development and means that relatively soon a government will be formed. [...] It is very important for public finances to be stabilised because otherwise if there will be an agreement with the IMF, it means that in future money should be paid back which will lead to an increase of taxes. When taxes go up, this it will reduce foreign investments and everything should be financed with local savings. The other thing which should be done is to create conditions to bolster local savings.