The communist regime in Bulgaria was perhaps the most stable in Eastern Europe, and its demise was brought about only by the general collapse of the Soviet bloc. In the light of this, what is surprising about the country's transition to democracy and a market economy is not that it has been uneven but that it has proceeded without fundamental disruptions and is now showing some signs of consolidation. The two-party system that emerged from the round table negotiations in 1990 has survived remarkably intact although the parties within it have undergone considerable transformations. The institutions of democracy have often been misused but have shown their ability to survive in crisis situations. After a dismal record of macroeconomic mismanagement, the establishment of a currency board has brought stability to the country's economy, and the long-delayed structural reform is finally off the ground. Having survived the trials of transition, Bulgaria is now faced with the more difficult task of adapting