Bulgaria Slashes 2012 Growth Forecast Down to 2.5%

Business » FINANCE | October 12, 2011, Wednesday // 15:14
Bulgaria: Bulgaria Slashes 2012 Growth Forecast Down to 2.5% Bulgaria’s Finance Minister Simeon Djankov is pictured here next to a photo of a meatless pizza, which he famously used as a metaphor for the austerity 2010 budget. Photo by Sofia Photo Agency

Bulgaria's government has sharply revised downwards its economic growth forecast for next year from 4,2% to 2,5%, citing the slow-down in Western Europe.

"My preliminary estimates for next year's growth are around 2.5%," Finance Minister Simeon Djankov said, adding that obviously the previous forecast for 4.2% was unrealistic given "the current events abroad".

Germany, Bulgaria's biggest trading partner, is recording a slow-down in its economic growth for the second quarter and has cut its forecast for the next one, the minister specified.

The Finance Ministry is expected to submit the budget draft for next year to the government next week. After the cabinet gives it the green light, it will be tabled for debates in parliament.

Driven by strong exports, as well as the good performance of the industry and services sectors, the Bulgarian economy has started to expand, but too weakly and unsteadily.

The economy expanded by 2% in the second quarter on an annual basis, down by 1.4% in comparison with the previous quarter, which marked the first considerable increase in economic growth since the country plunged into a recession. The seasonally adjusted GDP edged up by 0.3%.

The International Monetary Fund recently downgraded its forecast for the 2011 growth of the Bulgarian economy to 2.5% from a projected 3% estimate made at the beginning of the year.

Meanwhile the European bank for Reconstruction and Development (EBRD) lowered its annual economic growth forecast for Bulgaria from 3.1% to 2.3% in 2011.

All forecasts for the Bulgarian economy in 2011 are below the 3.6% growth projected by the Bulgarian government in its 2011 budget.

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Tags: Ministry, Djankov, Simeon, minister, finance, Germany, IMF, International Monetary Fund, EBRD, European Bank for Reconstruction and Development, growth, economic, march, January, quarter, export, exports, imports, GDP, economy, Bulgarian, Bulgaria, gross domestic product, budget
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