European Commission’s autumn forecast for the EU economy, released on November 9, re-iterated the economic growth estimate in the 28-country bloc for 2016 at 1.8 per cent and raised the target for the euro area by 0.1 percentage points, compared to the spring forecast issued in May, to 1.7 per cent.
European commission vice-president Valdis Dombrovskis, responsible for the euro, said that “EU economies have proven to be resilient,” and that the EC expected all member states’ economies to grow in 2017.
“In the light of increased global uncertainty, it is now even more important to pursue sound and prudent macroeconomic and budgetary policies. At the same time it is vital to address inequalities in our societies, so that no-one feels left behind,” he said.
The Commission’s forecast for 2017 envisioned a slowdown to 1.6 per cent in the EU28 and 1.5 per cent in the euro zone, before rebounding to 1.8 per cent and 1.7 per cent, respectively.
In Bulgaria’s case, the Commission changed its growth estimate to 3.1 per cent, compared to the spring forecast, which estimated a strong drop-off from last year’s three per cent growth to two per cent.
“For 2016, domestic demand is expected to contribute two percentage points to real GDP growth with net exports contributing 1.1 percentage points. While private consumption growth is forecast to remain robust at 3.2 per cent in 2016, investment is expected to contract by 0.8 per cent due to the slowdown in EU funds absorption following the completion of the 2007- 2013 programming period,” the Commission said.
The Commission said that Bulgaria’s government deficit was expected to fall to 0.9 per cent of gross domestic product in 2016 (the cabinet sees a balanced budget for this year), and government debt is seen increasing to 29.4 per cent in 2016 before declining to 26.3 per cent in 2017.
(Photo: Michael Faes/sxc.hu)