Bulgaria Economic Forecast

Bulgaria Economic Outlook

January 11, 2022

Economic activity cooled in the third quarter, according to a second national accounts estimate, with growth slowing in annual terms after Q2’s strong rebound. While partly attributable to a less favorable base effect, moderating consumption growth and a sharper contraction in capital spending drove the slowdown in the domestic economy, while the increase in exports more than halved from Q2’s level. Turning to Q4, a surge in Covid-19 infections through November prompted a tightening of related restrictions, likely weighing on activity. In politics, November’s elections—the third to have taken place in 2021—finally resulted in a new government, with the country’s parliament approving a four-party coalition headed by the Continuing the Change (PP) party. As such, Kiril Petkov of the PP was elected as the new prime minister, having campaigned on a zero-tolerance platform against corruption.

Bulgaria Economic Growth

This year, the economy should grow at a similar rate to 2021’s projected level. Lower public and household spending growth should be compensated by a rebound in fixed investment. However, risks are skewed to the downside amid a slow vaccination campaign, the spread of the Omicron variant and ongoing political uncertainty. FocusEconomics panelists see the economy expanding 3.8% in 2022, which is unchanged from last month’s estimate, and 3.9% in 2023.

Bulgaria Economy Data

2015 2016 2017 2018 2019
Population (million)7.27.17.17.07.0
GDP per capita (EUR)6,3846,8467,4198,0128,717
GDP (EUR bn)45.748.652.356.160.7
Economic Growth (GDP, annual variation in %)4.03.83.53.13.4
Consumption (annual variation in %)3.63.53.84.35.8
Investment (annual variation in %)2.7-6.63.25.42.2
Industrial Production (annual variation in %)2.92.73.40.30.6
Retail Sales (annual variation in %)11.86.15.43.33.3
Unemployment Rate8.06.75.74.7-  
Fiscal Balance (% of GDP)-1.70.11.12.02.1
Public Debt (% of GDP)26.029.325.322.320.4
Money (annual variation in %)8.87.67.78.99.9
Inflation Rate (CPI, annual variation in %, eop)-0.40.12.82.73.8
Inflation Rate (HICP, annual variation in %)-1.1-1.31.22.62.5
Inflation (PPI, annual variation in %)-1.7-2.94.24.13.8
Policy Interest Rate (%)0.010.00.00.00.0
Stock Market (annual variation in %)-11.727.215.5-12.3-4.4
Exchange Rate (vs EUR)1.961.961.961.961.96
Exchange Rate (vs EUR, aop)1.961.961.961.961.96
Current Account (% of GDP)0.13.23.51.44.1
Current Account Balance (EUR bn)0.11.61.80.82.5
Trade Balance (EUR billion)-2.6-1.0-0.8-1.9-1.7
Exports (EUR billion)21.923.127.027.729.1
Imports (EUR billion)24.524.127.729.630.8
Exports (annual variation in %)4.25.416.62.94.9
Imports (annual variation in %)3.1-1.815.16.84.0
International Reserves (EUR)20.323.923.725.124.8
External Debt (% of GDP)73.370.364.860.356.2

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Bulgaria Facts

Value Change Date
Bond Yield0.400.0 %Dec 31

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