The International Monetary Fund (IMF) said on December 14 that Bulgaria’s economy was in good health as the country prepares to take the six-month rotating presidency of the Council of the European Union, urging policymakers to “translate this recovery into durable and inclusive convergence of people’s incomes toward levels prevailing in the richer EU partners.”
“This will require continued action on many fronts, notably increasing the efficiency of public institutions at all levels; remedying weaknesses in education, healthcare, and labor markets; and further strengthening the financial stability framework,” the IMF said in a statement after a review of the country’s economy, known in IMF parlance as an “Article IV consultation.”
The IMF mission, led by Jörg Decressin and Jaewoo Lee, visited Sofia between December 5 and December 14.
“Progress on all these fronts will ultimately help deliver the better, more rules-based governance toward which many in government and society have been working tirelessly in collaboration with EU partners and institutions,” the IMF said.
The IMF mission found Bulgaria’s economy to be “performing well” and on an upward trend for five consecutive years, reaching 3.9 per cent in 2016. The Fund said that was projecting “broadly similar growth for 2017 and 2018.”
Despite a number of positive developments – a positive current account balance, declining external debt, conservative fiscal policy and price stability – there were still possible downside risks, including from global financial market volatility or geopolitical events.
The fund also noted that the country’s membership in the EU had been a major catalyst for reform. “Bulgaria now stands on the cusp of taking over the EU presidency. The challenges facing the EU are significant and we wish the Bulgarian government every success in helping address them during the country’s presidency,” the Fund said.
“We also note that Bulgaria is contemplating joining ERM II with a view to ultimately fulfilling the country’s commitment to join the euro area. Membership in the euro area, including the banking union, will provide for a greater role of Bulgaria in the EU’s decision-making bodies and more responsibility for the success of the currency union.”
(IMF headquarters building at 1900 Pennsylvania Avenue in Washington, DC. Photo: AgnosticPreachersKid/Wikimedia Commons)