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The Bulgarian Economy will grow of only 1.5% in 2011, according to analysts. Earlier forecasts predicted a growth of 2.6%. However, the expectations are for a decrease of the export and a negative impact on the labour market.
The slowing down of the growth of Bulgaria’s GDP is due to the negative perspectives for the Euro zone economy and the expected sharp drop of the investment in Bulgaria in the third quarter of 2011.
The analysts expect additional decrease of the balance of the corporate sector. The export which has been the stabilizing factor of the Bulgarian economy is expected to shrink and to put under a risk the already stabilizing labour market.
It is expected that Bulgaria will avoid the second recession because the balance of the public sector remains strong, while the export demand is steadily decreasing, although it is far from the sharp drop experienced in the beginning of 2009. The growth of the Bulgarian economy is expected to return to normal levels in two-three years time.

The Bulgarian National Statistics Institute has announced that from July to September 2011 the Bulgarian GDP has increased BY 0.3% in comparison with the previous quarter of 2011. In comparison with the same period of 2010, the growth is by 1.6%. Nevertheless, the Bulgarian economy is slowing down. In the first quarter of 2011 the growth of the GDP was 3.3%, while in the second it was 2%. According to the analysts in the beginning of 2012 the growth will slow down even more it will not enter into a recession.
In the last year the productivity of the Bulgarian economy was one of the best in Europe – exceeding 7%. Partially this was due to the lost of jobs, partially to increased production. The National Statistics Institute has announced that in the first quarter of this year the Bulgarians have increased their productivity by 5.9% on an annual basis. The highest increase was in industry, while the worst was in agriculture.

The Bulgarian parliament passed the Bugdet 2012. According to the budget the growth of the Bulgarian economy in 2012 will be 2.9%. However, according to the National Statistics Institute the Bulgarian econcomy has slowed down in the last quarter of 2012. The Bulgarian GDP has not changed in the period July – September 2011 and has increased by 1.3% on an annual bassis. Usually the summer months are considered very good for the Bulgarian economy because of the expected income from tourism. The expectations were that slump of the European markets will affect Bulgarian economy in the autumn, however this has happened much earlier. The Bulgarian government is prepared to revise Budget 2012 in case that the situation gets worse.

A Greek bank group has predicted that the Bulgarian economy will slow down due to the debt crisis in the Euro zone and the negative prospects for the recovery of the European and the US economies. The Eurobank EFG Group announced that in 2011 the growth of the Bulgarian GDP will be 3,5%. In their forecast for 2011 the predicted growth of 3,2% of the Bulgarian GDP has been revised to 2,9%.

According to the Greek bank group the Bulgarian economy is slowing down, despite being above the average levels for the EU in the last quarter of 2011. The major drive of Bulgaria’s growth is the export, but in the second quarter of this year, its volume has decreased in half in comparison with the first quarter. The Bulgarian export shall continue to decrease due to the worse conditions on the EU market – the main market of the country.

On the positive side the domestic demand is gaining speed and the investments have increased. According to the forecast the investments will keep increasing because of the privatization programme of the Bulgarian government and the improved use of the European funding. Bulgaria, according to the Eurobank EFG Group has not been affected by the debt crisis and has remained stable financially, and its credit rating has improved.

The Bulgarian economy will continue sinking in 2010. The decrease of the GDP will be of 1%, according to the Agency for Economic Analysis and Forecasts.  For 2009 the expectations are of a significant  decrease of the GDP of 6.3%.  Bulgaria will be in recession for two consecutive years.  The decrease of the investments and the retail index will continue in 2010.  The expenses in Bulgaria’s budget will not increase in order to avoid deficit.  The major reason for this is the world wide recession. Although there have been signs for upcoming end to the recession in the USA, the risks for the world and the European economy are still there.

The slowing down of the economies of Bulgaria’s major trading partners has led to shrinking of Bulgaria’s export. The export of goods has decreased by 30,7% in the first five months of this year and it is expected that the decrease will be 10,5% on an annual basis. This has its effect on the transport and freight. As result the total volume of the export will shrink by 12,3%. The limited crediting and the slow increase of the personal incomes has led to a decrease in the investments and the sales in the country itself. The expectations are that in 2009 the spending of the average household will shrink by 4.5% and of the government by 3%.

In the following years the domestic demand, which has been generating mostly by the foreign investments, will be hard to resume the growth of the  Bulgarian economy to the levels of the last years.  That is why the recuperation of the economy is expected to materialise through the export. Having in mind the current world wide tendencies, this will not happen in 2010.  To the contrary, the export will continue decreasing and the expectations are that it will shrink by 3,8% next year.  That is why the forecast is for economic decrease of 1% in 2010. This will be accompanied by relatively low inflation about 2,2%.