Bulgaria calls early elections for May 12 as it readies power price cuts

By bne IntelliNews March 1, 2013

bne -

Bulgaria will hold early elections on May 12, the country's president has announced, as parliament looks for a way out of the deepening political crisis by drawing up plans to cut electricity prices.

President Rosen Plevneliev announced on February 28 that elections will not be held for two-and-a-half months, despite the resignation of the centre-right government of Prime Minister Boyko Borisov more than a week previously. The administration walked out on February 20 as nationwide protests grew against high electricity prices as well as austerity measures in the poorest state in the EU.

With protests continuing, none of Bulgaria's major parties feel it is in their interests to form a new government in the current parliament, leaving the president with no other choice but to appoint an interim administration. "I believe that the necessary key changes in the laws should be decided by a new parliament. The decision is to hold elections," Plevneliev told a packed session of parliament.

Adding to a sense of political limbo, outgoing Prime Minister Boiko Borisov has been hospitalized with high blood pressure before an interim government has been appointed. Borisov remains formally in office until that temporary administration is appointed.

Meanwhile, parliament is pushing through a plan to cut electricity prices as it attempts to defuse public anger and stop the building protests against high power bills. Demonstrators have attacked power company offices, and three people have set themselves on fire, prompting parliament to pass a law allowing electricity prices to be cut by the 8% promised by Borisov just before his resignation..

The tariff cut is set to start this month. That will further hurt the country's electricity distributors - owned by Czech companies CEZ and Energo-Pro, and Austria's EVN - which are already the focus of protesters' ire, and further deteriorate relations between Bulgaria and its EU partners, particularly the Czech Republic.

The perception of high electricity prices - in a country where the average monthly wage is just €400 and pensions less than half that - are merely a symptom of a deeper malaise in the country, one politician claimed, as the campaigning begins. "The situation is tragic. We need a radical a change - people took to the streets due to total misery," said Sergei Stanishev, leader of the Bulgarian Socialist Party (BSP).

Six years after joining the EU, Bulgaria trails far behind other members. Its justice system is subject to special monitoring and its citizens are excluded from the passport-free Schengen zone because of other members' concerns on corruption. Many protesters say they are angry with Bulgaria's whole political class, causing more uncertainty over the upcoming election, and government concessions raise the risk of a widening deficit and market pressure. Borisov's GERB party is now running neck-and-neck with the BSP and neither is expected to win a majority. Whichever coalition forms a government, it will be under significant pressure to spend more.

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