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Economic growth in 2006 to be 5.3% according to Industry Watch poll of forecasters.
submited on 16.05.2006 in category Political stability | Macroeconomic developments
submited on 16.05.2006 in category Political stability | Macroeconomic developments
As an independent source of economic research and analysis Industry Watch presents regulars forecasts on Bulgaria’s economy, based on a poll of selected macroeconomists. The poll takes place twice a year (spring and fall). In the current spring poll we present the updated forecast for 2006 and a forecast for 2007.
We expect the economic growth level in 2006 to remain similar to that of the previous year.
The forecasts for 2006 show slightly increased optimism of the macroeconomists, who foresee a growth of 5.3% on average (which is higher than the forecast in the fall of 5.1%).
The inflation (CPI y-o-y) forecast for 2006 is expected to reach 7%. Such development is seen as normal in the year of sizable administrative changes of consumer prices – an excise duty increase and a likely electricity price growth.
For this and the next year the investments growth is expected to remain robust of about 15%. However, we must bear in mind that this dynamics represents the most uneven and unpredictable segment of the economy. This characteristic is reflected in the leading economists’ forecast for the capital growth which oscillate between 13 and 18% for 2007.
The other expected factor to boost the economy growth – the export dynamics, is expected to continue to grow with double digit rates despite the forecasted rise of trade deficit.
The forecasts for the next year must be dealt with caution for investment decisions. The next year is particularly difficult to forecast due to the growing political lack of predictability in the country. Alongside this, the possible effects of the membership (or its postponement) of Bulgaria in EU are hard to assess from macroeconomic perspective.
We expect the economic growth level in 2006 to remain similar to that of the previous year.
The forecasts for 2006 show slightly increased optimism of the macroeconomists, who foresee a growth of 5.3% on average (which is higher than the forecast in the fall of 5.1%).
The inflation (CPI y-o-y) forecast for 2006 is expected to reach 7%. Such development is seen as normal in the year of sizable administrative changes of consumer prices – an excise duty increase and a likely electricity price growth.
For this and the next year the investments growth is expected to remain robust of about 15%. However, we must bear in mind that this dynamics represents the most uneven and unpredictable segment of the economy. This characteristic is reflected in the leading economists’ forecast for the capital growth which oscillate between 13 and 18% for 2007.
The other expected factor to boost the economy growth – the export dynamics, is expected to continue to grow with double digit rates despite the forecasted rise of trade deficit.
The forecasts for the next year must be dealt with caution for investment decisions. The next year is particularly difficult to forecast due to the growing political lack of predictability in the country. Alongside this, the possible effects of the membership (or its postponement) of Bulgaria in EU are hard to assess from macroeconomic perspective.
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