Bulgaria to spend 16.7 billion leva to counter regional inequality

Written by on June 4, 2012 in Bulgaria, Business, News - No comments

Bulgaria will spend 16.7 billion leva over the next decade to erase the development inequality within the country and to catch up with the European Union average, according to the Cabinet’s national strategy for regional development for 2012-2022, as reported on June 4 by Bulgarian mass-circulation daily Trud.

The bulk of the funding, about 13 billion leva, is expected to be financed by the EU, with national co-financing by central and local authorities amounting to 3.7 billion leva.

According to Trud’s report, the highest share of funds, about 5.3 billion leva, would be spent on improving water and sewage infrastructure, an area where Bulgaria is significantly lagging behind other EU member states.

A total 3.7 billion leva will be allocated to improving transport and communication infrastructure, and a further three billion leva will be invested in “urban improvements”.

About one billion leva has been earmarked for improved access to educational, healthcare and social services, as well as improving sports infrastructure; in total, about 200 existing sports facilities would be refurbished and a number of new ones built.

Another one billion leva would be spent on aid for small and medium-sized businesses, while 600 million leva would go towards improving quality of life in rural areas and sustainable tourism.

On average, Bulgaria’s per-capita gross domestic product (GDP) remains a meagre 43 per cent of the EU average. However, if one discounts the south-western Bulgaria economic region – which includes capital Sofia and accounts for half the country’s GDP (reaching 73 per cent of the EU average) – the other five economic regions have consistently ranked in the bottom six of the annual regional development rankings published by EU’s statistics office Eurostat.

North-eastern Bulgaria, the area hit worst by unemployment and demographic changes over the past decade, contributes only 7.4 per cent of the country’s annual GDP and ranks as the least developed region in the EU, at 28 per cent of the bloc’s average.

Despite the strategy’s avowed goal to diminish regional inequality within the country, the highest amounts have been allocated for the south-central region (which includes the country’s second-largest city, Plovdiv) and the south-western region (which includes Sofia), at four billion leva and 3.8 billion leva, respectively.

The north-western and north-central regions will receive 2.3 billion leva each, while the north-eastern (Varna) and south-eastern (Bourgas) economic regions have been allocated 1.7 billion leva each.

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