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The economy of Bulgaria declined dramatically during the 1990s with the collapse of the COMECON system and the loss of the Soviet market, to which the Bulgarian economy had been closely tied. The standard of living fell by about 40%, and only regained pre-1989 levels by June of 2004. In addition, UN sanctions against Serbia (1992-95) and Iraq took a heavy toll on the Bulgarian economy. The first signs of recovery emerged when GDP grew 1.4% in 1994 for the first time since 1988, and 2.5% in 1995. Inflation, which surged in 1994 to 122%, fell to 32.9% in 1995. During 1996, however, the economy collapsed due to the BSP's, slow and mismanaged economic reforms, its disastrous agricultural policy, and an unstable and decentralized banking system, which led to an inflation rate of 311% and the collapse of the lev. When pro-reform forces came into power in the spring 1997, an ambitious economic reform package, including introduction of a currency board regime, was agreed to with the IMF and the World Bank, and the economy began to stabilize. As of 2007 the economy is growing at a steady pace of above 5% a year with budget surpluses [3] and shaky inflation. Future prospects are tied to the country's increasingly important integration with the European Union member states. The country is expected to join the Eurozone between 2010 and 2012. Image File history File links Question_book-3. ... ISO 4217 Code BGN User(s) Bulgaria Inflation 7. ... Map of countries showing percentage of population who have an income below the national poverty line The poverty line is the level of income below which one cannot afford to purchase all the resources one requires to live. ... CIA figures for world unemployment rates, 2006 Unemployment is the state in which a person is without work, available to work, and is currently seeking work. ... A Soviet poster reading COMECON: Unity of Goals, Unity of Action The Council for Mutual Economic Assistance (COMECON / Comecon / CMEA / CEMA), 1949 – 1991, was an economic organization of communist states and a kind of Eastern Bloc equivalent to—but more inclusive than—the European Economic Community. ... CCCP redirects here. ... The standard of living refers to the quality and quantity of goods and services available to people and the way these services and goods are distributed within a population. ... UN and U.N. redirect here. ... Economic sanctions are economic penalties applied by one country (or group of countries) on another for a variety of reasons. ... Not to be confused with Republika Srpska. ... The Bulgarian Socialist Party (Bulgarian: Bălgarska Socialističeska Partija or Българска социалистическа партия) (BSP or БСП) is a political party in Bulgaria and successor to the Bulgarian Communist Party. ... This article needs to be cleaned up to conform to a higher standard of quality. ... ISO 4217 Code BGN User(s) Bulgaria Inflation 7. ... The flag of the International Monetary Fund (IMF) The International Monetary Fund (IMF) is the international organization entrusted with overseeing the global financial system by monitoring foreign exchange rates and balance of payments, as well as offering technical and financial assistance when asked. ... The World Bank logo The World Bank (the Bank) is a part of the World Bank Group (WBG), is a bank that makes loans to developing countries for development programs with the stated goal of reducing poverty. ... The Eurozone (also called Euro Area, Eurosystem or Euroland) refers to the European Union member states that have adopted the euro currency union. ...

External trade & Investment

Since 1990, the bulk of Bulgarian trade has shifted from former COMECON countries primarily to the European Union, although 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, contradictory government tax and investment policies, and bureaucratic red tape kept foreign investment among the lowest in the region. Total direct foreign investment from 1991 through 1996 was $831 million. In the years since 1997, however, Bulgaria has begun to attract substantial foreign investment. In 2004 alone over 2.72 billion Euro (3.47 billion US dollars) were invested by foreign companies. In 2005 economists observed a slowdown to about 1.8 billion euros (2.3 billion US dollars) in FDI which is attributed mainly to the end of the privatization of the major state owned companies. WTO redirects here. ... For the American magazine, see Foreign Policy. ... Foreign direct investment (FDI) is the movement of capital across national frontiers in a manner that grants the investor control over the acquired asset. ...

Economic History after the Fall of Socialism

Reforms of the 1990s and early 2000s

Members of the government promised to move forward on cash and mass privatization upon taking office in January 1995 but was slow to act. The first round of mass privatization finally began in January 1996, and auctions began toward the end of that year. The second and third rounds were conducted in Spring 1997 under a new government. In July 1998, the UDF-led government and the IMF reached agreement on a 3-year loan worth about $800 million, which replaced the 14-month stand-by agreement that expired in June 1998. The loan was used to develop financial markets, improve social safety net programs, strengthen the tax system, reform agricultural and energy sectors, and further liberalize trade. The European Commission, in its 2002 country report, recognized Bulgaria as a functioning market economy, acknowledging the progress made by Prime Minister Simeon-Saxenoburgotski's government toward market-oriented reforms. This article does not adequately cite its references or sources. ... Berlaymont, the Commissions seat The European Commission (formally the Commission of the European Communities) is the executive branch of the European Union. ...

Rebound from the February 1997 crisis

Agriculture and industry in Burgas Province — fields near Lake Vaya and the Neftochim Burgas oil refinery on the opposite shore

In April 1997, the Union of Democratic Forces (UDF) government won pre-term parliamentary elections and introduced an IMF currency board system which succeeded in stabilizing the economy. The triple digit inflation of 1996 and 1997 has given way to an official economic growth, but forecasters are predicting accelerated growth over the next several years. The government's structural reform program includes: (a) privatization and, where appropriate, liquidation of state-owned enterprises (SOEs); (b) liberalization of agricultural policies, including creating conditions for the development of a land market; (c) reform of the country's social insurance programs; and (d) reforms to strengthen contract enforcement and fight crime and corruption. Image File history File links No higher resolution available. ... Image File history File links No higher resolution available. ... Burgas Province or oblast (Bulgarian: Област Бургас) is located in southeastern Bulgaria, on the southern Black Sea coast. ... The Union of Democratic Forces (Bulgarian: Съюз на демократичните сили, Saiuz na demokratichnite sili) is a political party in Bulgaria, founded in December 1989 as a union of eleven political ogranizations in opposition to the Communist government. ... World GDP/capita changed very little for most of human history before the industrial revolution. ...

In the European Union

     EU Eurozone      EU state aiming to join Eurozone on 1 January 2009 (Slovakia)      EU states obliged to ultimately join the Eurozone      EU state with an opt-out on Eurozone participation (U.K.)      EU state planning to hold a referendum on the euro and with an opt-out on Eurozone participation (Denmark)      Areas outside the EU using the euro with an agreement      Areas outside the EU using the euro without an agreement  v • d • e 

On 1 January 2007 Bulgaria entered the European Union. This led to some immediate international trade liberalization, but there was no shock to the economy. The government is running annual surpluses of above 3%. This fact, together with annual GDP growth of above 5%, has brought the government indebtedness to 22.8% of GDP in 2006 from 67.3% five years earlier ^[7]. This is to be contrasted with enormous current account deficits. Low interest rates guarantee availability of funds for investment and consumption. For example, a boom in the real estate market started around 2003 and has not subsided yet. At the same time annual inflation in the economy is variable and during the last five years (2003-2007) has seen a low of 2.3% and high of 7.3% ^[8] . Most importantly, this poses a threat to the country's accession to the Eurozone. The Bulgarian government plans for the Euro to replace the Lev in 2010. However, experts predict that this might happen as late as in 2012 ^[9]. From a political point of view, there is a trade-off between Bulgaria's economic growth and the stability required for early accession to the monetary union. Bulgaria's per-capita PPP GDP is still only about a third of the EU25 average , while the country's nominal GDP per capita is about 13% of the EU25 average. Image File history File links Download high resolution version (1244x1244, 108 KB) Licensing I, the creator of this work, hereby release it into the public domain. ... Image File history File links Download high resolution version (1244x1244, 108 KB) Licensing I, the creator of this work, hereby release it into the public domain. ... is the 1st day of the year in the Gregorian calendar. ... 2009 (MMIX) will be a common year starting on Thursday of the Gregorian calendar. ...  member state with at least one opt-out  member state with a de facto opt-out  member state without opt-outs Currently, five European Union member states have (or will have) opt-outs from certain parts of the European Union structure, namely:  Denmark (four)  Ireland (two)  Poland (one)  Sweden (one... “UK” redirects here. ...  member state with at least one opt-out  member state with a de facto opt-out  member state without opt-outs Currently, five European Union member states have (or will have) opt-outs from certain parts of the European Union structure, namely:  Denmark (four)  Ireland (two)  Poland (one)  Sweden (one... The Eurozone (also called Euro Area, Eurosystem or Euroland) refers to the European Union member states that have adopted the euro currency union. ... The Eurozone (also called Euro Area, Eurosystem or Euroland) refers to the European Union member states that have adopted the euro currency union. ... is the 1st day of the year in the Gregorian calendar. ... Year 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era in the 21st century. ... Blue = countries in surplus; Red = countries in deficit This is a list of countries and territories by current account balance, in millions of U.S. dollars, equivalence based on The World Factbook ([1]). Most data are 2006 estimates. ... An interest rate is the price a borrower pays for the use of money he does not own, and the return a lender receives for deferring his consumption, by lending to the borrower. ... Real estate is a legal term that encompasses land along with anything permanently affixed to the land, such as buildings. ... The Eurozone (also called Euro Area, Eurosystem or Euroland) refers to the European Union member states that have adopted the euro currency union. ... For other uses, see Euro (disambiguation). ... Lev can refer to several things: Lev is a male first name of Slavic origin. ... In economics, a monetary union is a situation where several countries have agreed to share a single currency (also known as a unitary or common currency) among them, for example, the East Caribbean dollar. ... PPP of GDP for the countries of the world (2003). ... GDP is an acronym which can stand for more than one thing: (in economics) an abbreviation for Gross Domestic Product. ... A regions gross domestic product, or GDP, is one of several measures of the size of its economy. ...

As of January 1, 2008 the income tax for all citizens is set to a flat rate of 10%. This flat tax is one of the lowest income rates in the world and the lowest income rate in the European Union [4]. The reform was done in hope for higher GDP growth and greater tax collection rates. Some called it a "revolution" in taxation, but the changes were met with mild discussions and some protests by affected working classes. The proposal was modified to allow for compensating the perceived losers from the changes in the tax formula. The corporate income tax is also 10% as of January 1, 2007 which is also among the lowest in Europe [5]. is the 1st day of the year in the Gregorian calendar. ... 2008 (MMVIII) is the current year, a leap year that started on Tuesday of the Anno Domini (or common era), in accordance to the Gregorian calendar. ... Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank   Money supply Fiscal policy Spending   Deficit   Debt Trade policy Tariff   Trade agreement Finance Financial market Financial market participants Corporate   Personal Public   Banking   Regulation        An income tax is a tax levied on the financial income... A flat tax, also called a proportional tax, is a system that taxes all entities in a class (typically either citizens or corporations) at the same rate (as a proportion on income), as opposed to a graduated, or progressive, scheme. ... Corporate tax refers to direct taxes charged by various jurisdictions on the profits made by companies or associations. ... is the 1st day of the year in the Gregorian calendar. ... Year 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era in the 21st century. ...

Statistics

Household income or consumption by percentage share:

• lowest 10%: 2.9%
• highest 10%: 25.4% (25.4)

Distribution of family income - Gini index: 31.6% (2005) The Gini coefficient is a measure of inequality developed by the Italian statistician Corrado Gini and published in his 1912 paper Variabilità e mutabilità. It is usually used to measure income inequality, but can be used to measure any form of uneven distribution. ...

Industrial production growth rate: 11.3% (Third Quarter)

Electricity:

• production: 45.7 TWh (2006)
• consumption: 37.4 TWh (2006)
• exports: 7.8 TWh (2006)
• imports: 0 TWh (2006)

Electricity - production by source: The terawatt hour (TW·h) is a unit for measuring energy. ...

• fossil fuel: 47.8%
• hydro: 8.1%
• nuclear: 44.1%
• other: 0% (2001)

Oil:

• production: 3,000 bbl/day (2005 est.)
• consumption: 131,400 bbl/day (2005 est.)
• exports: 51,000 (2005 est.)
• imports: 138,800 (2004 est.)
• proved reserves: 15 million bbl (1 January 2006)

Natural gas:

• production: 407,000 cu m (2005 est.)
• consumption: 5.179 billion cu m (2005 est.)
• exports: 0 cu m (2005 est.)
• imports: 5.8 billion cu m (2005)
• proved reserves: 5.703 billion cu m (1 January 2006 est.)

Agriculture - products: vegetables, fruits, tobacco, livestock, wine, wheat, barley, sunflowers, sugar beets Vegetables on a market Vegetable is a nutritional and culinary term denoting any part of a plant that is commonly consumed by humans as food, but is not regarded as a culinary fruit, nut, herb, spice, or grain. ... Popular Japanese fashion magazine throughout the 1990s; the photography of which has recently been reissued in two collections from Phaidon press. ... Shredded tobacco leaf for pipe smoking Tobacco can also be pressed into plugs and sliced into flakes Tobacco is an agricultural product processed from the fresh leaves of plants in the genus Nicotiana. ... Sheep are commonly bred as livestock. ... For other uses, see Wine (disambiguation). ... Species T. aestivum T. boeoticum T. dicoccoides T. dicoccon T. durum T. monococcum T. spelta T. sphaerococcum T. timopheevii References:   ITIS 42236 2002-09-22 Wheat Wheat For the indie rock group, see Wheat (band). ... For other uses, see Barley (disambiguation). ... For other uses, see Sunflower (disambiguation). ... Two sugar beets - the one on the left has been cultivated to be smoother than the traditional beet, so that it traps less soil. ...

Current account balance: $ -5.01 billion (2006 est.)

Reserves of foreign exchange & gold: $11.78 billion (2006 est.)

Exchange rates:

Source: Bulgarian National Bank. Levs per US dollar; On 5 July 1999 the lev was re-denominated; the post-5 July 1999 lev is equal to 1,000 of the pre-5 July 1999 levs. is the 186th day of the year (187th in leap years) in the Gregorian calendar. ... Events of 2008: (EMILY) Me Lesley and MIley are going to China! This article is about the year. ... is the 186th day of the year (187th in leap years) in the Gregorian calendar. ... Events of 2008: (EMILY) Me Lesley and MIley are going to China! This article is about the year. ... is the 186th day of the year (187th in leap years) in the Gregorian calendar. ... Events of 2008: (EMILY) Me Lesley and MIley are going to China! This article is about the year. ...

See also

• Economy of Europe
• Bulgaria

The economy of Europe comprises more than 710 million people in 48 different states. ...

Notes

1. ^ IMF Data report for Bulgaria 2004-2008
2. ^ IMF Data report for Bulgaria 2004-2008
3. ^ IMF Data report for Bulgaria 2004-2008
4. ^ Yearly and non-annualized unemployment series
5. ^ Ministry of Finance, Government Debt monthly bulletin
6. ^ Ministry of Finance, Government Debt monthly bulletin
7. ^ The Hard Road Towards the Euro. Capital (13 April, 2007).
8. ^ Inflation Statistics. Stat.bg (5 May, 2007).
9. ^ [[1] List of projections for year of accession to the Monetary Union]

External links

• IMF presentation of current macroeconomic challenges for Bulgaria
• Tax rates and tax revenue

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