Bulgaria's Trade Deficit Down by 40% in January-May 2010

Bulgaria's trade gap is closing thanks to the reduced domestic consumption caused by the economic crisis. Photo by BGNES

The gap between Bulgaria’s import and export is closing as the country’s trade deficit is down by 39.7% in the first five months of 2010 year-on-year.

According to data of the National Statistical Institute, Bulgaria’s total exports in January-May 2010 amounted to BGN 10.554 B, which is a 22.1% year-on-year growth.

At the same time, the imports amounted to BGN 12.969 B, which is an increase of only 2.5% compared to the first five months of 2009.

Thus, in January-May 2010, Bulgaria’s trade deficit amounted to BGN 2.415 B, 39.7% decline y/y.

Only in May, Bulgaria exported goods and services for BGN 2.37 B, a 33.8% increase compared to the same month of 2009. At the same time, its May imports amounted to BGN 2.95 B, a growth of 12.5% y/y.

Both Bulgaria’s export and import are accelerating their growth in April and May 2010. The NSI data indicates that exports of Bulgarian companies are on the rise for a seventh consecutive month. It confirms forecasts that export-oriented sectors will help the Bulgarian economy recover from the crisis and generate a minor growth of employment thanks the rise of foreign demand for Bulgarian-made products and services.

Yet, Bulgaria’s export in the first 5 months of 2010 is still 15% smaller than the volume of export realized in the same period of 2008, before the global crisis kicked in.

Bulgarian economists and analysts have attributed the rising exports to foreign demand, some restructuring made by export-oriented local companies, and faster recovery in non-euro zone countries.

Even though the Bulgarian foreign trade gap is expected to continue closing, it is still believed that the country’s exports will not be able to catch up with the imports by the end of 2010.

NSI data has indicated that Bulgarian companies are increasingly oriented towards exporting to non-EU states, as the share of Bulgaria’s trade with countries outside the EU rose to 40% up from 30% at the beginning of 2010.

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