Bulgaria on the Threshold of the New Millennium: Realized Ambitions and Forthcoming Challenges

Historically and geopolitically, Bulgaria's location in southeastern Europe and at the crossroads of the Western world and Eastern civilizations has invariably been a determiner of the trends and pace of the country's development. On the threshold of the new millennium, after ten years of hard transition and considerable reforms, Bulgaria stands ready to meet the expectations and challenges of integration into a united Europe. Our ambitions are part of the common European ambition and endeavor for unity; our achievements are part of those of the European states and of their citizens in terms of political stabilization and economic prosperity.

There are several reasons for calling the year 2000 the Year of Europe. The decisions of the European Councils in Helsinki, Feira, and Nice specified the parameters and provided guarantees for the European Union's further enlargement. The three councils guaranteed the place and role of future members in the EU's institutions and started the debate on the future of the EU in which the candidate countries are to participate on a par with their partners, the present EU members.

In Helsinki, Feira, and Nice, the EU gave yet another important signal: the European prospects for the countries in the western Balkans were enhanced by incorporating them in the stabilization and association process. The end of the war in Kosovo, the start of reforms in Croatia, and the democratic elections in Albania, Bosnia and Herzegovina, the Republic of Macedonia, Kosovo, and in the whole of the Federal Republic of Yugoslavia cleared the way for democratic reforms in those countries and generated conditions to stabilize the Balkans. These processes gave an impetus to the region's economic reconstruction and development. These developments have a real significance for Bulgaria, as part of the Balkans and part of Europe. Its national priorities reflect this reality.

Bulgarian foreign policy focal points are first and foremost in the field of European and Euro-Atlantic integration, the promotion of regional cooperation, and the economic reconstruction and political stabilization of the region. Understandably, these priorities are closely bound with domestic policy goals. Having achieved economic and financial stabilization, the Bulgarian government's emphasis is now on accelerating growth and completing reforms in privatization, defense, the social and health sectors, and other fields.

The attainment of these ambitious goals, along with harmonizing national legislation with that of the EU, is critical in Bulgaria's preparation for EU membership. The country's economic and political stability makes a substantial contribution to the overall stabilization of the region and provides additional impetus for Bulgaria's active role in regional cooperation. On the whole, 2000 was a very successful year for Bulgaria domestically and internationally in achieving the primary objectives facing the state and the government. The results achieved are a product of hard work in fulfilling an ambitious program that this government adopted and that the public supported over the past three years.

When the government of the Allied Democratic Forces came into office in mid-1997, it faced grave economic problems: hyperinflation, bankrupt banks, hundreds of insolvent enterprises, unemployment, and financial and social instability. There was no visible risk of pending internal destabilization, but instability in the region and the subsequent developments in Kosovo complicated the situation.

In these circumstances Bulgaria had to persuade its partners in Europe and elsewhere that they could consider Bulgaria a reliable and responsible partner and ally; it also had to persuade the Bulgarians that this was the case. Some of the first measures undertaken to overcome the economic crisis were a currency board arrangement introduced in July 1997 and the subsequent tightening of financial and fiscal discipline, stabilization of the banking system, restructuring of the key sectors of the economy, acceleration of privatization, liberalization of trade, reform in agriculture, and changes in legislation designed to provide more favorable conditions for entrepreneurship, business, and investment. As a result of this...