The EC expects strong economic growth in Bulgaria. The Commission expects the economy in the country to keep its growth stable over the coming years. According to the Commission’s spring forecast, Bulgaria’s GDP will increase by 3.8% this year and maintain a similar level of development in the next 2019 when the increase is expected to be 3.7%.
This way, the EC confirmed its autumn forecast from November last year when it increased its estimate of Bulgaria’s GDP by 0.1 percentage points. At the same time, the winter forecast, which has shown a lower growth next year (3.7%), has been revised.
In addition, the new forecast gives considerably more favourable expectations and stability to growth. According to previous estimates, the Bulgarian economy would have developed by 3.5% in 2019, while the figure now is 3.7%.
Domestic demand is expected to be a key driver of growth and the contribution of net exports will remain negative. Inflation in Bulgaria will continue to grow this year as a result of strong private demand. The positive trends in the labour market with a strong increase in wages and employment will also persist, the EC predicted.
The Commission foresees that public finances in the country will remain stable, supported by the favourable macroeconomic environment and despite the increase in public investment and wages. Bulgaria’s real GDP increased by 3.6% in 2017, mainly due to strong domestic demand, the EC noted in its spring report. While private consumption remained in an upward direction, public spending also increased. Strong demand and lower uncertainty also stimulated investment growth, mainly in the private sector.
Among the countries of Central and Eastern Europe, the forecast for the Bulgarian economy for 2018 is better than that for Croatia (2.8%) and the Czech Republic (3.4%), but less than that for Slovenia (4.7%), Romania (4.5%), Poland (4.3%), Hungary (4%) and Slovakia (4%).
