Fitch says Bulgaria Government's economic growth outlook for 2012 is 'optimistic'
Rating agency Fitch has described as optimistic the forecast by Bulgaria's Government of 2.9 per cent economic growth in 2012, the Finance Ministry said in a statement on November 17 2011."The draft budget targets a deficit of 1.3 per cent of GDP. This is predicated on 2.9 per cent economic growth, a level we consider optimistic given the slowdown in the euro zone," Fitch said.Meanwhile, the agency has maintained its "positive" outlook on the country.According to Fitch, Bulgaria's economy has demonstrated impressive flexibility in adjusting to the global financial turmoil. However, exports have been the main driver of its recovery and Fitch expects that sales abroad will weaken given the enhancing risk of a recession in the euro zone.Fitch is also concerned about the level of non-performing loans in the country, but notes that the growth rate has slowed compared to the start of the crisis.Meanwhile, the fact that 40 per cent of the country's banking system assets are controlled by Greek and Italian institutions represents a further challenge, according to the agency.Nevertheless, Bulgaria's banking sector is considered sufficiently robust to deal with the risk of an extreme weakening in the financial systems of the two troubled countries. (Source: The Sofia Echo)