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Bulgaria GDP Q3 2023

Bulgaria: GDP growth records slowest increase since Q4 2020 in Q3

According to a preliminary estimate, GDP growth lost steam, falling to 1.7% year on year in the third quarter from 2.1% in the second quarter. Q3’s reading marked the softest result since Q4 2020. The result was stronger than the Euro area’s 0.1% average rise.

The moderation came on the back of a sharper annual drop in exports of goods and services, coming in at minus 7.8% (Q2: -2.5%). In contrast, fixed investment rose at a brisker pace of 9.4% (Q2: +0.4%). Similarly, final consumption growth accelerated to 6.1% yoy from 5.7% in the prior quarter.

Additionally, on a seasonally adjusted quarter-on-quarter basis, economic growth eased slightly to 0.4% in Q3, compared to the previous period’s 0.5%. Q3’s reading marked the worst reading since Q2 2020. That said, the outturn was above the EU average of +0.1% year on year.

Analysts at the EIU commented on the outlook for 2024:

“The impact of the war in Ukraine on Bulgaria and the region will continue to abate. Inflation will slow substantially, which will boost disposable incomes and will provide some respite for household spending. Investor confidence, however, will remain subdued, mainly as a result of the wider EU slowdown, but also owing to Bulgaria’s exposure to insecurity in the Black Sea. The recent deterioration in security levels in the Black Sea, following Russia’s refusal to renew the Black Sea grain deal, could complicate external trade and raise insurance costs.”

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