Economists: Many Obstacles to Bulgaria's Slow Recovery
The Bulgarian economy will brace for minimal growth the following quarters but is nowhere near equaling its levels before the crisis, say researchers from the Institute of Economics at the Bulgarian Academy of Sciences.
Former Bulgarian National Bank board member and present researcher in the Academy of Sciences Garabed Minassian lists as hurdles for growth low liquidity of the bank system, the outflow of capital and low levels of foreign investment, failure to absorb EU funds, and state budget problems.
Regarding the latter, researchers bewailed uncontroled "leaking" from alleged "holes" in the budget and recommended restructuring of spending, instead of bare cutting.
The Institute of Economics researchers lay strong stress on the outflow of moneys from the country, stating that for the first half of 2010 it was EUR 1.2 B, against a EUR 0.9 B outflow 2009 and a EUR 1.3 B inflow 2008.
They also recommend more relaxed and bold National Bank measures to stimulate bank liquidity.
As regards EU funds, the Bulgarian Academy of Sciences researchers report a 65% decrease in the last two years preceding June 2010.
The economists view finance minister Simeon Djankov’s efforts to get in the country as premature and unneeded at the point.
Friday the National Statistics Institute reported a record low slowdown Q2, suggesting the country might be coming out of the recession.
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