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Home » Economy of the World » Bulgaria
 

Bulgaria Economy
Bulgaria, officially known as the Republi cof Bulgaria, is a state in the southeastern Europe and is bordered by five countries Romania, Serbia, the Republic of Macedonia, Greece amd Turkey. Bulgaria Economy declioned drastically during 1990s. This is due to the collapse of the COMECOM system and the loss of the soviet market. The standard of living fell by 40 percent and it regained its pre-1989 status only by 2004. In additions, UN sanctions against Serbia (1992-95) and Iraq took a heavy toll on the Bulgarian economy. The first signs of recovery of Bulgaria Economy emerged when the GDP grew to about 1.4 per cent in 1994.

During 1996, however, the economy collapsed again due to the BSP's, slow and mismanaged economic reforms, and also because of disastrous agricultural policy, and an unstable and decentralized banking system.

Since 1990, the Bulgarian trade was shifted from former COMECON countries mainly to the European Union. But Russian petroleum exports to Bulgaria make it Bulgaria's single largest trading partner. In December 1996, Bulgaria joined the World Trade Organization. In the early 90's Bulgaria's slow pace of privatization and bureaucratic red tape, contradictory government tax and investment policies, kept foreign investment among the lowest in the region. In April 1997, the Union of Democratic Forces or UDF government won pre-term parliamentary elections and introduced an IMF currency board system which succeeded in stabilizing the economy of Bulgaria. The structural reform of Bulgaria Economy was based on certain things that include:

  • reform of the social insurance programs of the country
  • reforms to strengthen contract also ensure a suitable sysytem to against fight crime and corruption.
  • liberalization of agricultural policies that includes creating conditions for the development of a land market
  • privatization and also liquidation of state-owned enterprises under appropriate circumstances
On January 2007 Bulgaria entered the European Union. Although this led to some immediate international trade liberalization, but there was no shock to the Bulgaria Economy. Low rate of interest guarantee availability of funds for investment and consumption. Simultaneously the nation saw a fluctuation in its economy that ranges from as low as 2.3 per cent and as high as 7.3 per cent. Moreover, this was a threat to te haccwssion of eth country in the Eurozone. The Bulgarian government plans for the Euro to replace the Lev in 2010. the experts are of te hopinion that it might happen as late as 2012. From a political prespective there is a trade-off between the growth of Bulgaria economy and the stability required early accession to the monetary union. Bulgaria's per-capita PPP GDP is still only about a third of the EU25 average , while the nation's nominal GDP per capita is about 13 per cent of the EU25 average.