Bulgaria’s GDP Could Grow by over 3% in 2021, 4-5% in 2022, If Vaccination Campaign Progresses Well – IME Economist

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(Bulgarian News Agency)

In an interview for BTA, Institute for Market Economics (IME) senior economist Petar Ganev forecasts that in a good-case scenario, if in the summer Bulgaria has made significant progress with the COVID-19 vaccination campaign, thus removing concerns over a new shutdown of the economy in autumn, the country’s GDP could grow by some 3 per cent in 2021 and even by 4 to 5 per cent in 2022. In a bad-case scenario, a new shutdown, albeit a partial one, in the autumn due to a slow vaccination campaign, emergencies caused by new coronavirus strains or low vaccine efficacy, would continue to suppress the potential of the Bulgarian economy.

According to preliminary data of the National Statistical Institute, last year’s real GDP decreased by 4.2 per cent from 2019, Ganev says. He recalls that in mid-2020, the state budget was updated and the Government expected a GDP drop of 3 to slightly over 3 per cent in the best-case scenario, while the central bank’s forecast was gloomy: a drop of up to 8 per cent. 

At the end of 2020, however, most institutions rallied around the expectation of a 4 per cent GDP drop. The economist notes that there are worse examples in Europe, with some southern countries hit harder by the pandemic experiencing a 10 per cent drop. In his words, the big question is how the economic recovery will look like and whether Bulgaria will manage to create jobs, because in most areas the unemployment rate has increased by some 2 percentage points.

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