After only 9 months of regular government, Bulgaria has yet again descended into a political crisis and is left with a new caretaker government. Negotiations for government formation failed days after the country partly joined the Schengen area. This is a crucial moment as assessments for Bulgaria’s full accession to Schengen and the Eurozone are anticipated soon. New parliament elections are scheduled together with the European election on the 9th of June. This will mark the country’s 6th parliamentary elections since 2021.
Cycle of Instability
The summer of 2020 marked a breaking point in the Bulgarian political landscape. Thousands of people took to the streets to express dissatisfaction with the country’s government, judicial system and ongoing corruption. The protests challenged the governing of Citizens for European Development of Bulgaria (GERB), which was the leading party for more than a decade. The then-approaching parliamentary election resulted in the formation of new political parties and coalitions. While for some citizens this was a step towards bettering the country, in reality, a spiral of political instability began.
Since April 2021, Bulgaria has had two functioning governments. The first one, a government coalition led by the newly emerged We Continue the Change (PP), lasted for 6 months. The second and most recent one was a grand government coalition between GERB and PP-DB (Yes, Bulgaria!), the base of which was a “gentlemen’s agreement” between the two parties. GERB and PP-DB agreed upon the Prime Minister’s rotation for a year and a half. The first 9 months were led by Nikolai Denkov (PP), after which Mariya Gabriel (GERB) would have taken over.
While not a common practice, the agreement allowed for PP and GERB to put their rivalry aside and form a working pro-European government. Its main points of action were securing full Schengen membership, entry to the Eurozone, judicial system reforms, and providing aid to Ukraine. At least, when the time came for Gabriel to step into position things did not go smoothly. Tensions between PP and GERB were rising before Denkov’s agreed-upon resignation. GERB proposed a long-term coalition agreement that was not received well by PP-DB. The main reason was the inclusion of the Turkish minority party DPS, the co-leader of which is Delyn Peevski. Peeviski has a controversial reputation due to being sanctioned by the US for corruption. When PP-DB continued with the agreed-upon rotation, GERB perceived the action as arrogant. And so began the familiar cycle of negotiations, with parties blaming each other for government shortcomings while achieving no tangible results.
After two weeks of going back and forth, GERB and PP-DP failed to negotiate a new government. GERB reasoned that PP-DP were trying to seize as much power as possible, while PP-DP accused GERB of working together with DPS to hold back reforms in the judicial system. Both parties stated that negotiations would only be possible after new elections.
Eurozone
In March, the president of Eurogroup, Paschal Donohoe, concluded his visit to Bulgaria with the quote “I am strongly convinced that Bulgaria will join the eurozone in 2025”. Denkov’s administration set the 1st of January 2025 as a possible entry date. Nonetheless, following the government collapse, opinions on the matter started to differ. Bulgarian National Bank Governor, Dimitar Radev, estimated that the country will be able to join the eurozone later or at the end of 2025. However, Politico reports that experts find January 2026 more realistic.
For a country to enter the Eurozone, it must meet the four convergence criteria and have national legislation ensuring the independence of the national central bank. Bulgaria has met all but one of these conditions – price stability. To fulfil this requirement, the country’s inflation rate should not be more than 1.5% higher than that of the three best-performing Member States. Bulgaria’s annual inflation rate in 2023 was 8.6%, considerably higher than the allowed benchmark. The annual estimate for 2024 is 3.4%, but as of March, the rates have dropped below the estimate. If this trend continues, Bulgaria’s chances of entering the Eurozone increase.
While chances to meet inflation criteria rise, the political instability might stumble the process. Joining the eurozone was a point in the national agenda of the last two regular governments. In 2021 actions to do so did not end up being realized. Dencov’s administration did make efforts towards meeting the convergence criteria, but the political scene remained unstable, with parties blaming each other for the shortcomings. Additionally, a failure to form a regular government after the elections could lead to a new caretaker one, focused on organizing the next election, as has happened before. In such a scenario attention and resources will be moved away from implementing a stable currency transition and maintaining policy cohesion.
Schengen
In March, Bulgaria and Romania partly joined the Schengen Area, allowing free movement within the zone by air and sea. Land border control remains in place, due to Austria blocking the full accession for both countries. While the European Parliament calls for full Schengen membership, a date for finalizing the accession has not been set. The main reason behind Austira’s veto is concerns with Bulgaria and Romania’s abilities to tackle illegal migration.
The topic of migration has always been politicized, especially at the EU level and even more so before EU elections. Bulgarian political parties are no strangers to this phenomenon. To advance its full Schengen accession, Bulgaria has increased Frontex officers on the Turkish border and has been granted funds from the EU to help strengthen border control. Around the same time, the country was accused of human rights violations across the border. The Ministry of Interior denied the accusation and has tried to demonstrate adherence to EU standards. However, on a national level, the surge of disinformation about migration has ended up having a counter effect.
Incidents involving migrants have led to protests against refugee camps. Some of these protests were organized by parties’ representatives, facilitating the narrative that the country is facing a “migration crisis”. The political turmoil in Bulgaria can stumble the negation power of the country. Politicians politicizing migration to gain public support, go against actions made so far for the country to gain full Schengen membership. Such contradictions can be used by Austria or other Schengen members as a reason to further postpone the lift of land border controls.
Conclusion
Bulgaria has been once again left under the rule of a caretaker government. The recent collapse of the coalition government, coupled with the failure to negotiate a new one, has showcased the challenges of governance in a fragmented political landscape. As the country prepares for its sixth parliamentary elections since 2021, the path forward remains uncertain.
- Considering previous unsuccessful negotiations, what advantages could the upcoming elections bring to the discussion?
- What are the possible negative impacts of further delaying full Schengen and Eurozone accession?
- What are some potential consequences of Having both national and Europen parliamentary elections at the same time?
