WB: Bulgaria 1st in FDI among Southeastern EU States

Business | January 25, 2007, Thursday // 00:00| Views: | Comments: 0

Bulgaria scores first among the ten Southeastern EU member states in GDP percentage of foreign direct investments (FDI), regular economic report of the World Bank showed.

The EU 8+2 report shows Bulgaria manages to cover its high current account deficit (CAD) because of the attracted FDI, which helps to increase productivity of economy. FDI also covered the CADs of the Czech Republic and Poland and most of the deficits in Hungary, Slovakia and Romania. The banking sector played the main role in financing the deficits in the Baltic States but also contributed importantly in Romania.

As of January 1, 2007, Bulgaria and Romania became the 26th, respectively 27th, members of the EU, a historic landmark in their protracted and uneven transition towards becoming fully fledged market economies.

The prospects of joining the EU club constituted a solid external anchor for the transformation of the two countries, placing Bulgaria and Romania on a steady path of converging in income, competitiveness and living standards towards the EU, reads the report.

It also states the unfinished reforms agenda remains considerable and the structural adjustment of the two countries needs to continue, especially in the areas of governance and market regulation.

Bulgaria's economic growth has been robust in recent years, driven by productivity gains, innovation, a better allocation of resources, and, occasionally, excess demand.

Labor participation and employment in Bulgaria are well below the EU-15 average. The share of the agricultural sector remains unsustainably high, while employment in services is substantially below the EU average, data showed.
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