Budget policy. Under conditions of inadequate preparedness for EU integration on the most important economic, infrastructure, environment, education, R&D and other criteria Bulgaria needs more active budget policy. This means moderate budget deficit up to 2,5-3% of GDP, budget incentives for investment in infrastructure, environment protection, education, R&D and strengthening of budget discipline. Budget resources must be allocated with priority to areas where the Bulgaria is lagging far behind from western and central European countries in order to improve preparation for EU accession. Better preparation for EU accession must be the major objective of budget policy over the following years and not necessarily a strict budget balance.

Inflation policy. The average price level in Bulgaria is 33% of the EU price level. For the sake of convergence with the EU over the next 15-20 years prices in Bulgaria must increase 2,5-3 times faster than in the EU over the next ten years. If this did not happen now in an orderly gradual manner it will take place in a shock uncontrolled way in the years after accession. Price convergence is a necessity for an integration community. EU experience has proven that when less developed countries join with much lower level of GDP per capita, productivity, incomes and prices they must grow faster to converge gradually with the average levels in the Community. This is indispensable for Bulgaria too.

Upgrading competitiveness. By the growth competitiveness index Bulgaria ranks 59^th, by the business competitiveness index 75^th and by networked readiness index 67^th. Bulgaria is at the bottom among EU members and the candidate countries and faces grave challenges as future EU member. Bulgaria is outstripped even by 15-20 underdeveloped countries. This is a very alarming signal for Bulgarian policy makers and society at large.