Bulgaria President May Order Ex-PM to Start Cabinet Talks

Bulgarian President Rosen Plevneliev will probably ask former Prime Minister Boyko Borissov to form a new administration after his Gerb party won May 12 elections and give a date for Parliament to reconvene.

The president is taking his first post-election step by scheduling the start of coalition talks as the Central Electoral Commission prepares to release final results. Gerb took 30.5 percent to the second-place Socialist Party, which garnered 26.61 percent. Plevneliev will make his announcements at 2 p.m. in Sofia today.

The narrow gap between the two parties’ results may prolong political tensions that started when Borissov’s Cabinet lost power in February by anti-austerity protests. Squabbles with rivals including the Socialists over curing the economic slump, boosting tax revenue and building a 10 billion-euro ($13 billion) nuclear power plant raises concerns about whether Bulgaria will have to call new elections as early as this year.

“With only four parties having qualified for the next parliament, the room for the political engineering that is needed to produce a stable ruling coalition looks limited,” Kristofor Pavlov, chief economist of UniCredit Bulbank in Sofia, said in an e-mailed note. “The polarized campaign makes it unlikely that the elections restored faith in the political system, which would have reduced the political and social tension in the country.”

Gerb, which stands for Citizens for the European Development of Bulgaria, is set to get about 97 seats in the 240-member Parliament, with about 84 seats going to the Socialists, according to the electoral commission.


The Movement for Rights and Freedoms, which represents the ethnic Turks in the Balkan country, won 11.29 percent and may control 36 seats, while the radical nationalist Attack party got 7.3 percent with 23 lawmakers, the Central Electoral Commission said.

Gerb will comment on plans after official results are released, the party said in an e-mailed statement after the vote. Borissov was the only political leader who didn’t hold a press conference after the elections. Gerb is seeking the informal support of Attack to form a minority government, Pressa newspaper reported today, citing unidentified politicians.

The Socialists and the Movement for Rights and Freedoms said they are prepared to form a coalition Cabinet, while Attack said that no government can be formed with the composition of the new Parliament. The Movement ruled out a coalition with Gerb.

Socialist Cabinet?

A possible Socialist Cabinet with the Movement would be “positive news that will help to avoid a return to the polls,” Pavlov said. “But forming a coalition government is likely to need either tacit or more formal support from the nationalist Attack party, which is a clear drawback, given its excessive fiscal populism and hostile rhetoric toward international investors.”

Attack leader Volen Siderov said he will only support a government that would “free Bulgaria of the colonial rule of international monopolies.”

The Socialists and Attack want to scrap Bulgaria’s current 10 percent flat tax on personal and corporate income and resume building the Belene nuclear power plant by Russia’s Rosatom Corp. Borissov canceled the project because of a lack of funds and investors. The Movement wants to keep the flat tax and are neutral on Belene’s construction.

Former Finance Minister Plamen Oresharski, the Socialists’ choice for premier, told reporters on May 13 that the “economy and finances are in a free fall” and the most urgent measures would be to boost budget revenue by curbing contraband and lifting administrative pressure on businesses.

Before it's here, it's on the Bloomberg Terminal.