The government of Bulgaria has decided to provide a significant capital injection for the Bulgarian Development Bank (BDB), a move that is expected to stimulate the economy in the long term. At a meeting today, the Council of Ministers approved an increase in the bank's capital by BGN 4 billion and adopted a decree on changes to the budget of the Ministry of Finance, which is directly related to this decision. The news was announced at a special briefing by Finance Minister Temenuzhka Petkova.
The decision is a direct result of the updated medium-term budget forecast for the period 2025 – 2028, which serves as the rationale for the 2025 Budget Act. According to Minister Petkova, the BDB, which is a sole shareholder company with state rights exercised by the finance minister, has a special role in the country's economic life. She emphasized that the bank, in addition to operating under the supervision of the Credit Institutions Act, is also guided by a special Law on the Bulgarian Development Bank. One of the main goals of the institution, according to the law, is to provide financial instruments for investments in public and priority projects for the economy.
Minister Petkova assured that the large-scale capital increase operation will not have any impact on the country's budget deficit. She clarified that the purpose of this move is to provide the bank with the opportunity for long-term financing of important investment projects that have been identified by the state as a priority for the economic sector. Among the expected areas for investment, she listed:
- the construction of new industrial zones
- the rehabilitation and construction of water supply and sewerage infrastructure
- projects in the field of green energy and energy efficiency
- the defense and security sectors
According to the finance minister, the expected effect of this capital injection is twofold. First, it is foreseen to increase revenues in the treasury as a result of investments in the various sectors. In addition, an increase in dividend revenues that the BDB will pay into the state budget is also expected.
"I want to nip any attempts at speculation in the bud"
In an attempt to stop any potential speculation regarding the management of the funds, Minister Petkova paid special attention to the decree of the Council of Ministers concerning their storage. The minister explained that after the capital increase is registered, the funds will be restored to a special foreign funds account of the Ministry of Finance. They will be stored under the conditions of the Public Finance Act, which, according to her, will guarantee publicity and transparency, while at the same time preserving the operational autonomy of the bank. While explaining to the media, Minister Petkova seemed determined to dispel any doubts and present the decision as a key step for the country's economic future.