Bulgaria's Economy Is Slowly Picking up
The past 2012 could be defined as good for Bulgaria's economy though our expectations are for a faster economic recovery. But still - even if slowly - Bulgaria's economy is picking up. The employment rates improved slightly although the unemployment rate has also increased. The inflation rates in Bulgaria are acceptable. Bulgaria's export continues to outpace import. Bulgaria's foreign debts decreases and the state finances show stability.
Bulgaria's economy continues to grow at disappointingly low paces. The economic growth for 2012 is expected to oscillate between 1-1.5%. In order that the Bulgarians feel the economic growth it has to be at least 3.5%-4%.
In 2012 both employment and unemployment rates have been growing as the upward trend in the number of the employed shows rather that there are certain problems on the job market and it could hardly be otherwise having in mind that the unemployment coefficient has exceeded 10 percent while it should vary from 5 to 7 percent in an economically healthy country.
The inflation rate, measured by the Harmonized Index of Consumer Prices (HISP) has been in synchrony with the rates measured in 2012, as according to HISP rates for 2012 the inflation in the past year was three percent, which is commensurate with the rates registered in the developed economies. To a great extent the inflation results from external factors, such as, for instance prices of raw materials because the demand remains low on the national level.
What Should Bulgaria Expect in 2013?
The 2013 will be better than 2012. Bulgaria's economic growth is expected to be somewhere between 1.5-2.5% of the country's GDP. The situation of the labour market will also improve and the number of employed Bulgarians will increase. The Foreign Direct Investments will keep their upward trend and the balance on the current account may become slightly negative due to the larger share of import but if the current trend of positive balance on the running account is kept, this will mean growing competitiveness of Bulgaria's economy.
Bulgaria's trade banks will feel more stable and provide more loans, which will make the share of bad credits smaller. The inflation may grow a little due to both internal and external factors. The government outlays will probably even up with the revenues as slight deficit is probable mostly owing to the increase of pensions. It is quite expectable that the credit rating of Bulgaria will be upped to at least A-/A3 which is an acknowledgement of a prudent fiscal policy of all governments since 1997 on.
Source: Standart news
(03.01.2013)