In 2011 the European economy has continued to recover slowly from the influence of the global economic and financial crisis. This is manifested by the data about the developed markets in Western and Northern Europe according to King Sturge and Colliers’ reports. According to them the return of these economies to growth entailed even last year more transportation and logistics orders. This is a trend which is also being transferred to Central Europe. However, East and South-wise the picture is different. Bulgarian market makes no exception – logistic services and equipment demand is still bleary. Traffic growth at the large airports and ports of Western Europe, return of trust in the export sectors, increased demand of storehouse areas and logistics equipment: this is the picture throughout Europe according to a market research by King Sturge, with the specification that
business doesn’t recover at fast rates everywhere. If the demand of logistics equipment in Great Britain doubled, the growth in Germany was 40%, and in France – nearly scarce. Eastern Europe’s leader is the Czech Republic with a logistics equipment and services demand two times higher, followed by Romania with a growth of 86%. The optimism, however, decreases, considering the nearly frozen consumer activity.
In the period January – August 2011, the Current and Capital account was positive, amounting to EUR 1696.3 mn, or 4.3% of GDP. As of end-August 2011 gross external debt was EUR 36,037.8 mn or 91.4% of GDP. Foreign reserves amounted at EUR 13.05 bn at the end of September 2011. The total business climate indicator in September 2011 keep its level from the previous month and only in construction a decrease of the indicator is recorded. Consumer price inflation declined to 3.3% y/y in September 2011 Producer Price Index on Domestic Market in August 2011 grew by 6.6% compared to the same month of 2010. Total Producer Price Index in August 2011 grew by 7.0% comparing to the same month of 2010. In August 2011 the working day adjusted turnover in Retail trade, except of motor vehicles and motorcycles declined by 2.9% in comparison with the same month of the previous year. According to preliminary data the Industrial Production Index, seasonally adjusted, decreased by 2.0% in August 2011 as compared to July 2011. Bulgaria's government targets 1.35% of GDP deficit in 2012 draft budget law.
In the period January – June 2011, the current and capital account was positive –
EUR 602.8 mn (1.5% of GDP), against a deficit of EUR 889.8 mn (2.5% of GDP) for
January – May 2010. Аs of end-June 2011 gross external debt was EUR 36207.2 mn or 93.1% of GDP. Foreign reserves increased to EUR 12.5 bn in July 2011.
In July 2011 the total business climate indicator increased by 0.7% compared to
its level from the previous month. Improvement was observed in industry, con-
struction and retail trade, while in service sector – deterioration. CPI declined to 4.4% y/y in July 2011. Total Producer Price Index fell by 0.3% compared to the previous month, versus to the same month of 2010 the prices rose by 9.0%. The preliminary data showed that the Industrial Production Index, seasonally adjusted decreased by 1.5% in June 2011 as compared to May 2011. The working
day adjusted Industrial Production Index rose by 2.2% as compared to the same
month of 2010. According to the NSI preliminary seasonally adjusted data in June 2011 the turn- over in Retail trade, except of motor vehicles and motorcycles at constant prices decreased by 0.6% compared the previous month.
In the period January – May 2011, the current and capital account was positive –
EUR 428.5 mn (1.1% of GDP). Аs of end-May 2011 gross external debt reported EUR 36,063.7 mn or 92.7% of GDP. Foreign reserves increase to EUR 12.34 bn at the end of June 2011. In June 2011 the total business climate indicator declined by 0.4 percentage points compared to its level from the previous month as the NSI inquiry registered some improvement of the business conjuncture only in the service sector. The consumer price index (CPI) in June 2011 compared to May 2011 was 99.1%, i.e. the monthly inflation was -0.9%. Producer Price Index on Domestic Market in Мay 2011 decreased by 0.2% m/m, while compared to the same month of 2010 the domestic prices grew by 10.0%. Total Producer Price Index fell by 1.3% m/m and compared to the same month of 2010 the prices rose by 9.2%. The preliminary data showed that the Industrial Production Index, seasonally adjusted, decreased by 0.5% in May 2011 as compared to April 2011, and on annual base in May 2011 the working day adjusted Industrial Production Index rose by 7.8% y/y. By preliminary seasonally adjusted data of NSI, in May 2011 the turnover in Retail trade, except of motor vehicles and motorcycles at constant prices grew by 0.4% compared to the previous month and by 1.6% y/y based on working day adjusted data.
The Bulgarian tyre market showed quite a stable growth on the level of 15% y/y before the crisis. Upon the crisis, this market suffers a deep decline and the recovery may take more than a year. As a rule, these are high-quality products of world brands that are concentrated in the highest price segment (segment A) and also quality tyres that are referred to the medium segment (VFB – value for money, segment B). Tyres that are referred to the lower price segment (economy class, segment C) were offered mainly Asian-Pacific Region countries. Segment A
usually includes such brands as Michelin, Bridgestone, Nokian, etc. Segment B is
represented by such makes as Kumho, Matador, Amtel, Kama-Euro and others. As for segment C, usually it includes inexpensive low-quality tyres.
Before the crisis, one of the common trends in the Bulgarian market had been connected with the change in the demand for the more expensive and quality products manufactured by famous foreign companies. This happened mainly because of the presence of analogous products on the Bulgarian automotive market.