Bulgaria's Economy to Expand 1.3-1.5% in 2014 - Expert

Finance | October 25, 2013, Friday // 16:36|  views

Bulgaria's Socialist-led government of Plamen Oresharski says budget 2014 is dedicated to growh, not austerity. Photo by Sofia Photo Agency

Bulgaria's former finance minister has recommended revising downwards the economic growth forecast by the government, which he says is unrealistically high.

The Socialist-led cabinet of Plamen Oresharski forecast 1.8% economic growth next year, driven by exports and recovery in the European Union after protests and early elections curbed this year’s expansion.

“Expectations for an economic growth of 1.8% are too optimistic,” Lyubomir Datsov, former finance minister in the centrist cabinet of Simeon Saxe-Coburg, told Bulgarian on Air TV channel.

According to him the realistic economic growth for next year ranges between  1.3 – 1.5%.

''Bulgaria's draft budget for next year reminds me of 2010. The government of Boyko Borisov was too disoriented and failed to lead the economy in the right direction. Instead its policy deteriorated the economic crisis in the country.

He pointed out that the draft budget piles huge expectations on the National Agency for Revenues and the customs offices, which are expected to improve tax collectivity and revenue flows.

Bulgaria's finance ministry has kept unchanged its forecast for economic growth next year at 1.8%, a new draft budget shows.

According to the draft budget, due to be tabled in parliament in the coming weeks, 2014 budget revenues will climb to BGN 30.8 B, up by BGN 501 M in comparison with the current year.

Spending is forecast to increase to BGN 32.3 B, while deficit to drop to 1.8%.

Inflation is projected at an average 1.8%.

The government says it has based its forecast of 1.8% economic expansion next year on expected improvements in domestic demand thanks to improved business environment and more investments.

The draft budget figure for GDP growth however exceeds the latest forecast of the International Monetary Fund.

At the beginning of October IMF downgraded its global GDP forecast for 2013 and 2014, including for Bulgaria.

In its biannual assessment of the world economy, the IMF predicts a 0.5% growth for Bulgaria in 2013, as opposed to the 1.2% forecast in April.

For 2014, the figure is 1.6%, down from 2.3% in the April assessment.

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Tags: Bulgaria, budget, 2014, deficit, inflation, growth, GDP


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