The International Monetary Fund (IMF) said on Monday that it expects Bulgaria's gross domestic product (GDP) to rise by 3.6% in 2021 following an estimated 4.6% decrease in 2020.
"Noting that the outlook is subject to unusually high uncertainties, Directors emphasized that policies should remain flexible and evolve with changing circumstances," the IMF said in a statement upon concluding Article IV consultations with Bulgaria.
"They highlighted the importance of structural reforms over the medium term to promote strong, inclusive growth and income convergence toward advanced EU partners," the IMF added.
The partial recovery of the Bulgarian economy is expected to be led by private consumption and helped by an accommodative fiscal stance.
Strong growth momentum and a gradual decline in the current account surplus are projected for the next couple of years as consumption and private investment continue to recover, the IMF also said.
Consumer price index (CPI) inflation is expected to speed up from 0.5% at the end of 2020 to 1.9% at the end of 2021.
Once the pandemic wanes, Bulgaria should put a stronger emphasis on improving governance, fighting corruption, strengthening active labor market policies and the education system.