PRESIDENT Petar Stoyanov resolved Bulgaria's political crisis yesterday, brokering a compromise between the governing Socialists and the opposition which paves the way for early general elections in April.
Hailing the accord as historic, Mr Stoyanov said Bulgaria had pulled back from the brink of civil war.
"Never before has Bulgaria been so close to a civil war," Mr Stoyanov, a centre-right "pragmatist" who assumed the presidency last month, said after the deal was announced.
The agreement came after the opposition had vowed to form a human chain around the parliament building, prompting fears.of a repeat of the violence last month when demonstrators battled with police and besieged and ransacked the parliament.
More than 10,000 opposition supporters assembled outside the Alexander Nevsky Cathedral, near the parliament building, welcomed the news with cries of "Victory!"
Bulgaria has been in turmoil since last December, when the prime minister, Mr Zhan Videnov, resigned amid mounting public anger over the crumbling economy.
But the former communist Socialist Party, which has a majority in parliament with its allies, fuelled anger by rejecting opposition demands for quick elections and pushing ahead with plans to form a new administration.
On Monday, on the eve of a parliamentary vote to confirm the new socialist administration in office, striking transport workers brought Bulgaria to a standstill and tens of thousands rallied in the capital, Sofia, for the 28th successive day.
Mr Stoyanov clinched yesterday's compromise accord at a meeting of the National Security Council, which was called in an attempt to end the unrest which has paralysed Bulgaria and deepened its economic problems.
The meeting of the council made up of leaders of all Bulgaria's political parties, the Prime Minister and the speaker of parliament, had not previously been announced.
News of the meeting came as state television said prime minister designate Nikolai Dobrev would not present to parliament the new Socialist cabinet he formed on Monday.
The opposition on Monday rejected a Socialist offer to join it in a grand coalition ahead of elections in June, 18 months early.
Ordinary Bulgarians have been hardest hit by the country's collapsing economy. Their main complaint is that while wages remained low, prices rose by more than 150 per cent in the first nine months of last year, while the Bulgarian lev fell by 235 per cent against the dollar.
Bulgaria has won pledges of support from the international community, including the European Union and the International Monetary Fund, if it solved its crisis.