2nd Ambassador’s Luncheon Series: Bulgaria Honorable Radoslav Totchev - April 24, 2012

On April 24, 2012, the Peace Islands Institute held its 2nd Ambassador’s Luncheon Series hosting Consul General of Bulgaria Honorable Radoslav Totchev with his presentation on the European Economic Crisis and its Relation to Bulgaria and the Future of European Union. The event was moderated by Dr. Roger Hanwehr, who is a New York based global strategist and financial industry executive at Methodist Ltd. (UK) 

Dr. Hanwehr said that the role of Bulgaria is critical in Eastern Europe, and that more attention needs to be paid to the role Eastern European countries play as they are a significant component to Eurozone. Dr. Hanwehr followed by introducing Hon. Totchev, and gave an overview of his distinguished diplomatic career.
During the program, Hon. Consul General Totchev addressed the question of, if the economic crisis will change the European Union and Bulgaria, answering: “Yes!” Hon. Mr. Totchev mentioned he had expectations regarding the economic crisis, but global trends need to unveil themselves. Mr. Totchev, further discussed the history of the European Union, saying the European Union was at the beginning an idea encouraged by the United States in order to share interests and that the EU is not a federation but a partnership between nation states. Mr. Totchev mentioned that the Euro was implemented on January 1, 2002, and is now being used by seventeen of the twenty seven member nations. Furthermore, Mr. Totchev said that the members of the EU have an agreement regarding budgetary discipline in which the public debt to GDP should not be more than three percent.
Consul General Mr. Totchev also gave an overview of lending to some Eurozone members, saying that if a country has consecutive deficits they will have to pay more when borrowing because of the increased risk associated with lending money, mentioning that some of the countries are not able to make payments to pay off the interest of the debt. Mr. Totchev stated that the accumulation of deficits has caused the current debt crisis in Europe and talked about the hyper inflation in Bulgaria in 1997, which was more than %1000 inflation in one month. As a result of the hyperinflation of 1997, Mr. Totchev said that the Bulgarian currency “Lev” was pegged to the Deutschemark which later became the Euro, and that in contrast to [some] European countries, Bulgaria has lowered its public debt from % 120 in 1996 to less than % 16 today. Mr. Totchev stated that starting in 2008 the crisis in Europe had affected Bulgaria, but that Bulgaria was better prepared due to strong budgetary discipline.
Question: “How will the European Economic Crisis change the future of Bulgaria and the European Union?”
Consul General Totchev: “I don’t know how, but European Union will come stronger out of this economic crisis if strict measures are taken by countries struggling with budget deficits.”