The European Bank for Reconstruction and Development lowered its forecast for the Bulgarian economy due to the low level of vaccination against the novel coronavirus and the political crisis. Does Bulgaria stand a chance to recover after the parliamentary and presidential elections?

According to the latest EBRD report, Bulgarian economy will expand this year by 4.2% -– 0.3 percent lower than the June forecast. In the second quarter of the year, per capita income reached the levels of the last quarter of 2019, and investment decreased by 7% compared to the pre-crisis period, it is clear from the document.

"This is a very clear sign that Bulgaria's economy is not recovering from the pandemic at the pace of our direct competitors “, comments Krassimira Georgieva, editor-in-chief of Business Global magazine talking to BNR-Vidin. “The autumn macro forecast of the European Commission was recently published, according to which the economic growth in Bulgaria is declining – it is below 4% in contrast to the general trend in the European Union for a slightly stronger increase than the spring forecasts. The main problem for the development of Bulgarian economy is that there is a lack of trained staff. And every foreign investor is interested in having manpower and infrastructure.”

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The absence of these two main factors can deprive us of the chance for a large company to transfer its production from Asia to Bulgaria, Krassimira Georgieva believes. Currently, there is such a trend - companies settling in peripheral European countries, where the labour market is cheaper.

Adrian Nikolov from the Institute of Market Economics emphasizes the forecast that inflation will remain above its pre-crisis levels for at least the next few years.

"This is an indicator that relates directly to family budgets, to the way households spend their money," the economist told BNR-Vidin. “Of course, political instability plays a role, but it is too early to say whether the elections will become a stabilizing factor, as negotiations for a coalition cabinet are at an early stage. If the next government puts the vaccination campaign at the centre of its policy, it will not only lead to greater international confidence in Bulgarian economy, but also to greater predictability within it. We continue to face the danger of a new Covid wave and a possible lockdown.”

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Optimism is a tool for overcoming the crisis - this is what Plamen Kamenov, owner of a sewing company in Vidin, believes.

"We, on the one hand, are a member of the EU, and, on the other hand, there is a precedent with our economic, political and social condition. Without optimism we will not be able to solve our problems. Hopefully, after the next elections, the new politicians in power will find the right path, because otherwise the disintegration of our value system, of our morality will continue”, the businessman believes.

Krassimira Georgieva is convinced that with its first step the new government must sharply increase the pace of vaccination.

"This is repeated in the forecast of the EBRD and the European Commission," she adds. “When people are vaccinated, social and economic life will work normally. So if we want to live normally, we have to get vaccinated. We do not have another choice."

Compiled by Diana Tsankova (based on interviews aired on BNR-Vidin)

English version Rositsa Petkova