Bulgaria’s economic performance has remained subdued during the post-crisis period. After a decline in economic activity in 2009, growth has been fluctuating around 1 % per year, and is forecast to remain so in the short term due to subdued domestic demand. Prices stagnated, followed by deflation in 2013, which is expected to extend through most of 2015. Export-oriented sectors of the economy have recovered faster from the crisis and Bulgaria’s gains in world market shares are projected to continue through 2016. Government finances also deteriorated considerably in 2014, and the deficit is projected to remain at around 3% of GDP for 2015 and 2016, while government debt will rise rapidly, albeit from a relatively low level.
Bulgaria is experiencing excessive macroeconomic imbalances, which require decisive policy action and specific monitoring. The Commission stepped up the imbalances procedure for Bulgaria in February 2015. In particular, the financial sector turbulence in 2014 has raised concerns about the existence of banking practices in the domestically-owned part, with potentially significant implications for financial sector and overall macroeconomic stability. In addition, the still negative, albeit improving, external position, corporate overleveraging and weak labour market adjustment continue to pose macroeconomic risks and deserve close attention.
Read a complete analysis of Bulgaria's economy in the country report 2015 [790 KB]
The Commission has made six country-specific recommendations to Bulgaria to help it improve its economic performance, which have been approved by all EU member states. These are in the areas of: fiscal consolidation; pension reform and health care; labour market and social inclusion; education and training; business environment; energy.