Potential delay of big infrastructure projects and external factors such as Brexit could slow down Bulgaria’s economic growth in 2019, the central bank said in its latest economic bulletin.
GDP is seen rising by 3.6% in 2019 by the European Commission. The central bank has projected the same growth rate, expecting it to accelerate to 3.8% in 2020.
“Between 2019 and 2020 real GDP growth is expected to gradually accelerate compared with 2018, reaching 3.8 per cent in the last year of the forecast horizon. This will depend on the decrease in the negative contribution of net exports, while the positive contribution of domestic demand to real GDP growth will slow down, particularly in terms of private consumption,” the central bank noted.
However, uncertain international environment will be a factor limiting corporate investment.
“Potential slowdown in implementation of large infrastructure projects would limit the GDP growth in 2019, but in the same time would lead to larger public investment in 2020,” the central bank noted.
It added that risks to the macroeconomic forecast come also from insecure economic growth important foreign trade partners and the possibility for Brexit without deal. Potential introduction of new foreign trade protection measures could also slow down the growth.
Another risk factor is the co-financing of public investment by the EU and the state budget.