Economic growth is expected, although minimal

Although during the first quarter of the year a slight decline in GDP was observed, on an annual basis as a whole we are expecting a positive economic growth of 1 %, announced yesterday the Chairman of the Center for Economic Development, Georgi Prohasky, who presented the traditional report on the state of the Bulgarian economy.

The latest annual data of the National Statistical Institute confirmed that after the GDP decline of 5.5% in 2009, our economic index increased in the last two years by 0.4% and 1.7%. Although the positive growth trend reemerged from the second-third quarter of 2010, it continues to be weak, while decelerating itself at the end of 2011 more than expected up to 0.3% last quarter. In fact, the short-term data for the first 2-3 months of 2012 are not encouraging for the positive overall economic growth for the first quarter. We expect a decline, albeit weak. Due to the uncertain and late recovery of our key external partners and the slow adjustment of our economy to the crisis conditions, the advent of the pre-crisis GDP volume is probably more expected not until the end of 2012, but in 2013. In fact, analysts have never been so divided on the forthcoming economic processes, argued Georgi Prohasky.

According to the interim forecast of the European Commission, the recovery of the European economies at the end of 2011 was unexpected. EC provides for the slowdown to continue in the first two quarters of 2012. The restoration of the moderate growth is expected in the second half of the year. For the EU, the forecast of the Commission is reduced to a zero growth for 2012. For Bulgaria, the outlook is also downgraded in comparison with the autumn forecasts of retarding growth up to 1.4%. In the draft of the updated National Reform Programme for 2012-2020, which was published in March, the Ministry of Finance has also lowered its forecast for macroeconomic development of our country up to 1.4% growth for 2012.

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