Bulgaria should sign a precautionary deal with the International Monetary Fund (IMF), not because it needed a bailout, but to boost security, Foreign Minister Ivailo Kalfin said on May 29.

Kalfin was campaigning for European Parliament elections in Varna as the leader of the Socialist party MEP list. He is on leave as Foreign Minister and Deputy Prime Minister overseeing economic policy for the duration of the campaign.

Socialist Prime Minister Sergei Stanishev and Finance Minister Plamen Oresharski have repeatedly rebuffed calls from business associations and analysts to seek an IMF deal, saying that Bulgaria did not need bailing out because its banks were sound and the economy would avoid the worse of the economic slowdown.

Flash estimates on economic growth for the first quarter of the year forecast the gross domestic product shrinking by 3.5 per cent.

According to Kalfin, who spoke to representatives of businesses from the Varna region, a precautionary agreement with the IMF would help maintain investor confidence in Bulgaria and prove that the country had access to outside financing.