Bulgarian NGO Experts Forecast Economy Slowdown

Bulgarian NGO Experts Forecast Economy Slowdown

The growth of Bulgarian economy will further slow down by the end of 2011, according to the Sofia-based NGO, Center for Economic Development (CED).

The forecast is based on economic slowdown of the country's main partners, according to the NGO's quarterly report "Economy of Bulgaria," presented Tuesday.

The growth in the third quarter is between 1% and 1.5% while for the year it will end up below 2% from the Gross Domestic Product (GDP).

According to CED, there is a noted trend for a balanced growth structure. Regarding GDP, the contribution of the industrial sector us going down, but services will be on the rise. Regarding its use, the contribution of the net export will shrink, while internal demand will go up.

The forecast of the NGO is close in numbers to the one of the National Statistics Institute (NSI) for growth on annual basis on seasonally unadjusted data - for GDP respectively 1.5% and 2.2%. The seasonally adjusted growth of GDP for the second quarter on annual basis is equal to the one of added value (2.2%) since the "correctives" position is going up with about the same pace (2.1%), according to the report.

The NGO sees investment dynamics in Bulgaria as alarming - on quarterly basis, in the last quarter of 2010, there was a strong increase (8.1%), and the growth continued in the first half of 2011, but with a slower pace.

CED experts say they saw, in the second quarter of 2011, difficult to interpret data - growth on annual basis on seasonally adjusted data (8.4%) and decrease on the unadjusted one (-9.1%), pointing out that since the latter is more relevant for yearly dynamics, they expect 2011 to end once again as 2010 (16.5%) - with a reduction of foreign investments, but below the one from the previous year.

According to preliminary data, direct foreign investments in the country for the January-August period of 2011 are estimated at EUR 225.6 M (0.6% of GDP), or just one fourth of those from the same period of 2010 - EUR 926.% M (2.6% of GDP)./Source: Sofia News Agency/

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