Bulgaria's gross foreign debt totaled EUR 36,6 B at the end of May, virtually remaining flat on the month, central bank data showed.

The debt, which accounts for 107,9% of gross domestic product (GDP), slowed to 14,6 % year-upon-year at the end of May from a 42,8 % rise in the same period a year ago.

The private foreign debt rose 16,4 percent to EUR 32,6 B at end-May on an annual basis and the public and publicly guaranteed external debt rose 1,6 % to EUR 4 B, data showed.

Bulgaria's long term-debt dues stood at EUR 23,279 B or 69% of GDP, while short-term liabilities stood at EUR 13,288 B or 38.9% of GDP.

The country paid a total of EUR 2,9 B to service its gross foreign debt in the first five months of the year, down from EUR 3,4 B in the same period a year earlier.

Economists have warned that given Bulgaria's large external debt and current-account deficit, the country may require some financial assistance from the IMF and the EU.

The country has already entered recession with its economy shrinking 5% from January to March and contracting 1.6% in the fourth quarter on a quarterly basis.

Bulgaria's gross domestic product (GDP) contracted by 3,5%in the first quarter of 2009 on an annual basis, the first time that the country's GDP marked a drop year-on-year since the financial and economic crisis in 1997.

The outgoing Socialists claimed that Bulgaria is better prepared to weather the global crisis in comparison to other European countries thanks to its prudent fiscal policy and does not need IMF aid for now.

The center-right GERB party, which won the general elections on July 5 has given indication that it is likely to turn the IMF for help, something the previous government has resisted and most economists would applaud.

A final decision is expected to be taken in February, when the budget parameters and the impact of the public spending cuts the party plans to undertake will be clear.

Bulgaria currently operates in currency board regime and the lev is pegged to the euro.

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