ECONOMY

Bulgaria needs 5.5 bln euros more for new infrastructure

SOFIA – Bulgaria wants 5.5 billion euros’ worth of investment in infrastructure projects through 2009 after planned EU entry next year, its prime minister said yesterday. The poor Balkan country has put off major public spending after a financial meltdown last decade and is now struggling with potholed roads, run-down railways, outdated airports and ports and a lack of modern sewage and waste disposal sites. «It’s a public secret that Bulgaria is seriously lagging behind with developing its infrastructure,» Prime Minister Sergei Stanishev said at a public discussion of an infrastructure strategy through 2015. «This is a priority for the government.» Sofia’s plans include a total spending of 7.5 billion euros by 2015, when it hopes to have built 720 kilometers in new highways, and upgraded its railways and energy links to benefit from its strategic location on the crossroads between Asia and Europe. Stanishev said the Socialist-led government has drawn detailed projects aimed to make utmost use of the expected inflow of millions of euros in EU funds as of January 2007. The Black Sea country is set to receive around 11 billion euros from the European Union in farm and development funds through 2013. He said the Cabinet will also tap international lenders and will grant highways, airports and ports on concession to improve the infrastructure, which analysts see as a major stumbling block to bigger foreign direct investment. Under the strategy, Bulgaria plans to spend more than 4 billion euros over the next three years in boosting its transport links. Another 1.3 billion will go to water purification stations, upgrade of sewage and waste disposal. Business welcomed the plan and urged the Cabinet to push on quickly with the projects but Finance Minister Plamen Oresharski warned that an explosion in public spending over the next years could threaten the financial stability. He said the ministry has put a budget limit for investment at 2.5 billion levs (1.3 billion euros) in 2007, or around 5 percent of expected gross domestic product. He said that can gradually grow to 5 billion at the end of the period. Oresharski said most of the funds will come from the EU, while private investors will invest around 2 billion euros through concessions.