EBRD: GDP growth in Bulgaria to reach 2.6% in 2024

GDP growth in Bulgaria in 2024 is to reach 2.6 per cent in 2024 and three per cent in 2025, supported by moderating inflation and robust consumption, as well as slowly recovering foreign demand, the European Bank for Reconstruction and Development (EBRD) said on May 15.

Key downside risks to the forecast include further delays in EU funds absorption and reforms amid elevated political uncertainty, the EBRD said in its latest Regional Economic Prospects report.

The 2.6 per cent for Bulgaria is the same figure as in the EBRD’s September 2023 report.

The May 2024 report said that GDP growth slowed to 1.8 per cent in 2023 amid subdued foreign demand and lower contributions from industry and services while private consumption expanded by 5.4 per cent.

Strong wage growth and declining inflation, which stood at 3.1 per cent as of March 2024, translated into relatively high real wage growth in 2023, while the minimum wage was hiked further, by almost 20 per cent in 2024.

Investment growth accelerated in the second half of 2023, but the ongoing political crisis poses risks to the public investment outlook and EU funds absorption.

Weaker EU demand led to a 1.9 per cent decline in exports in 2023 (in real terms), offset by a stronger fall of imports.

In nominal terms, exports to European economies outside the EU, including Ukraine, declined by almost 20 per cent in 2023 reflecting lower export prices of fuel and electricity, the EBRD said.

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