Industrialists: Bulgarian Economy Stabilizing but Still Underperforming
The Bulgarian Industrial Association published Wednesday an extensive analysis of the state of Bulgarian economy 2005-2009, indicated moderate optimism that in the next months the country's economy might gradually overcome the economic crisis.
This prognosis is based on increasing exports end of 2009 – beginning of 2010, as well as a small decrease in unemployment registered in March.
According to the Industrial Association this can give reasons for local companies to start increasing their production.
On the positive side, the analysis also states that the restructuring of Bulgaria's economy caused by the crisis is expected to have a positive effect on the dynamics of overall productivity, due to the survival of the best adapted enterprises.
On the negative side, the analysis mentions an overall weakness of human resources which are underdeveloped, as well as a general low productivity of business and workers.
The paper also emphasizes an ongoing increase in the redistributive role of the state budget: from 37.9% of GDP for 2008 to 39.5% of GDP for 2009 to 42.3% of GDP for 2010, which is characterized as a problem for Bulgarian economy.
Another state budget related drawback is the delay in state payments to the private sector in breach of contractual obligations. It quotes expert assessments that as of July 2010 only BGN 77 M out of BGN 640 M due have been paid.
A third negative emphasis from the report is the constantly slow rate of absorption of EU-funds, with only 8% of funds for the first half of the 2007-2013 EU budgeting period acquired by Bulgaria up to the present moment. A positive tendency in that field is nevertheless marked.
The report spans the term in office of the former tripartite coalition cabinet (2005-2009), as well as the end of the term of the prior liberal National Movement for Stability and Prosperity government (2001-2005), and the beginning of service of the current center-right GERB cabinet (July 2009 on).
For the full text of the analysis, read HERE (in Bulgarian).
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