21.01.2013

The European Bank for Reconstruction and Development (EBRD) has improved its expectations for the growth of Bulgarian economy in 2013 compared to the October 2012 forecast. The Bank expects a growth of 1.9%, which coincides with the economic growth forecast of the Ministry of Finance. EBRD analysts expect Bulgaria's economic activity to be above the average for SEE countries.

The Bank points out that the economic performance in the region, which also includes Albania, Bosnia and Herzegovina, Kosovo, FYR Macedonia, Romania, Serbia and Montenegro, has remained weak in 2012. Confidence and investment remain at low levels, macroeconomic policy is highly constrained on the fiscal side and financial sector vulnerabilities are still significant. The region is highly exposed to developments in the Eurozone, and within it to its periphery, the main market for exports. The countries whose economies are closely related to the currency union states will continue reporting a modest growth, says the EBRD forecast.

Against this background, experts consider that Bulgaria's fiscal performance remains very good, with only a very small deficit recorded in 2012. The report also mentions that as a result from the successful Eurobond issue in July 2012 Bulgaria has significant fiscal and monetary buffers to help the country withstand further shocks.

The EBRD forecast is close to the up-to-date World Bank report which forecasts a 1.8% GDP growth of Bulgaria for this year.

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