site.btaRising Bulgarian Public Debt Not Used for Investments, Says MEP Radan Kanev

Bulgaria's policy of not using public debt for investments in the development and modernization of industry is a mistake, said Bulgarian MEP Radan Kanev, a member of the European Parliament's Environment Committee. He was speaking during a discussion on the Clean Industrial Deal, balancing Europe’s sustainability goals and market realities. The event was organized by the European Parliament's Office in Bulgaria.

According to Kanev, in the context of the European Union's Green Deal, Bulgaria should have actively worked on technological innovations through large-scale investments in research and technology as early as 2019-2020.

Kanev pointed out that although this might sound unrealistic to some, a country's success depends on the size of its ambitions. He emphasized that Bulgaria needs to reconsider its policy of not investing public debt in the development of industry.

“The increase in Bulgaria's public debt, which is still at a very low level, does not have an investment impulse. I do not believe that maintaining external debt at 15% or 18% is some kind of universal good. If we look at the countries that have had economic growth over the last 20 years, they invested public debt. At this point, Bulgaria is firmly refraining from this, and I believe that this is the wrong policy,” Kanev said.

He also stated that the Clean Industrial Deal cannot be considered outside the larger framework of the Green Deal, as it is a natural continuation and, to a large extent, should be seen as a natural correction of the events surrounding the COVID-19 pandemic.

According to Kanev, as a result of the pandemic, the Green Deal lost its original meaning. It was initially meant to be a large-scale public investment plan, relying on clean technologies as a driver of new growth.

“Ultimately, the deal has taken on quite a perverse form – very heavy decarbonization requirements were placed on the industry, some of them I would say unrealistically heavy, and the money was given not to the industry but to governments,” Kanev said.

Regarding the future of coal-fired power plants in Bulgaria in the context of decarbonization, Kanev said that certain resources should be maintained as reserves.

During the discussion, economist Petar Ganev from the Institute for Market Economics stated that setting sectoral targets within the EU, such as the ban on internal combustion engine vehicles, does not seem reasonable. He argued that carbon emissions trading is a good mechanism that could help the EU achieve its carbon neutrality goals, as it sets a common framework and rules for everyone, unlike some sectoral targets.

According to Ganev, if internal combustion engine vehicles are banned, these emissions will simply be transferred to other sectors, as the set decarbonization target remains unchanged.