Central Bank: Bulgaria Economy to Grow by up to 0,5% Next Year

Bulgaria's economy will start recovering from recession next year and is expected to grow by up to 0,5% , the Central Bank announced on Thursday.

The forecast came as the budget for next year, which envisages the economy to shrink by 2%, was approved unanimously and without any debates by the economic and financial parliamentary commissions.

"Bulgaria will have the most stable fiscal policy among all European Union member states," Finance Minister Simeon Djankov said.

Central Bank Governor Ivan Iskrov said he expected the key driver of growth to be exports, but added it is still to early to track down trends.

The government has set a fiscal deficit at BGN 465.7 M or 0.7% of GDP next year but will target a zero gap in a bid to speed up euro zone entry.

The budget draft put spending at BGN 26 B and revenues at BGN 26.4 B, which are expected to include BGN 20,900 M in tax revenue and BGN 3,400 M in non-tax revenue.

Aid, the main share of which will come from the EU budget, is planned at 2,000 million leva.

The government expects the economy to shrink by 2% next year after contracting by 6,3% in 2009.

Foreign investments, which collapsed this year from BGN 6,5 B to BGN 3 B, have been penciled in at BGN 3,3 B.