Bulgaria's FinMin Happy with Lowered EC Economic Forecast

Bulgaria's Finance Minister Simeon Djakov has seen a silver lining in the worsened economic forecast for Bulgaria. Photo by BGNES

Bulgarian Finance Ministry Simeon Djankov has seen what he believes to be a major silver lining in the lower GDP growth forecast for Bulgaria announced by the EC.

Bulgaria's economy is to grow by 2.3% in 2012, according to the EC Fall Economic Forecast for 2011-2013 unveiled by EU Commissioner for Economic and Monetary Affairs Olli Rehn Thursday; it is substantially lower than the 2.9% economic growth envisaged in the draft 2012 State Budget Act engineered by Djankov's team – a figure that the Bulgarian Finance Minister himself already admitted is too optimistic.

"Bulgaria is fourth in the EU on the forecast economic growth for 2012," Djankov stressed Thursday afternoon at a joint sitting of the Bulgarian Parliamentary Committees on economic, budget, and health matters.

He also made clear his satisfaction with the fact that Bulgaria's forecast for 2012 has seen the lowest downgrade out of all EU 27 economies compared with the spring economic forecast of the Commission.

"The economic growth forecast of the European Commission for all European states has been reduced threefold. Bulgaria is one of the states with the lowest relative reduction – from 3.7% to 2.3%. Based on this indicator, Bulgaria is the 4th fastest developing EU economy. However, this is against the backdrop of an almost zero growth in the entire EU," the Bulgarian Finance Minister stated, as cited by BGNES.

He stressed the words of EU Commissioner for Economic and Monetary Affairs Olli Rehn that the EU should get ready for a recession that will be worse than the recession that Europe has just gotten out of.

"Even if the Bulgarian economy sees a downturn, which appears unavoidable if Western Europe gets into a recession, if we achieve an economic growth of 1%, that will still be sufficient for the 2012 State Budget to sustain the pressure. The events in Greece and Italy lead us to believe that we be thinking of an even more conservative state budget because there is no way that we won't get affect by what's happening around us," Djankov explained in Parliament.

"We have focused on financial stability and increasing the spending only in the welfare, sports, and culture sectors as well as greater sums for co-financing of EU-funded projects, while preserving the budget of most government ministries with some reductions in the security sector," the Finance Minister summarized the draft budget.

"The budget will survive. I urge you to take into account what's happening around us in Europe," he concluded.

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