European Fiscal Board Names Bulgaria Only State Facing Deficit Procedure

The European Fiscal Board identified Bulgaria as the only European Union member state facing a new excessive deficit procedure under the fiscal rules introduced in April 2024. In a recent report, the independent watchdog criticized the European Commission and the Council of the EU for exercising excessive discretion and leniency by granting repeated exemptions to other member states.

These exceptions, proposed in March 2025 as national derogation clauses, allowed countries to deviate from debt-reduction targets to fund energy resilience and defense spending. The Board warned that such flexibility risks undermining confidence in a framework that requires countries to limit debt to 60% of GDP and deficits to 3%.

This criticism follows a rise in EU government debt, which reached 82% of GDP in 2025 and is projected to exceed 84% in 2026. The Board noted that no opinions were issued under the comply or explain rule, leaving Bulgaria as the sole country facing procedural consequences.