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The 7.2% Economy Decline Forecasts Seem to Be Confirmed, Daniela Bobeva Believes


"BG economy began to accumulate serious problems long before the pandemic. Transferring the problems of the economy to the corona crisis is, to say the least, incorrect." This was said to BNR by Professor Daniela Bobeva - economist, financier and former Deputy Prime Minister.


"The EC and the ECB have published four very important reports in recent weeks containing data for 2019 which showed that the Bulgarian economy is developing in a very unfavorable direction. Regarding the most important indicator - GDP per capita - we are catastrophically lagging behind. And this is before the pandemic, "she explained.

 

In 2007 we were second to last in Europe but we have been in the last place for 10 years now and the distance with the European average is moving away. "From Croatia, which is in the penultimate place - we are 10% behind and from Romania - 19%. The EC report on sustainable development was also published. We have stepped back on many indicators. But the reports on convergence are the most important, there we are told that Bulgaria performs the worst in terms of business environment," said Bobeva.

 

The EC diagnosis is also a reason for the protests in our country, she is categorical: "The European Commission diagnosis says:" The slow pace of improvement and the lack of significant reforms have brought Bulgaria down from 50th place to 61st in terms of the business environment. The main problems are related to the institutional framework, including the anti-graft fight, the functioning of the judiciary, the need to reduce administrative burden and the need for quality public services," Prof. Bobeva explained.

 

"If somebody has been running a country for a decade without finding a way to eradicate corruption according to the indicators of reliable international institutions and the economy in their country is getting worse, it means they just can't handle it. That is why we are looking for an option and a person who will be able to do it," the expert added.

 

According to Bobeva more political will is needed to solve most of the problems.Currently, however, "we are heading for the return of old models, which turned out to be totally ineffective for Bulgaria." At the moment, the situation in the Bulgarian economy is "quite shocking," she added.

 

"The EC's forecast that we will have a 7.2% decline in the economy this year seems to be confirmed. Personally, I did not believe that this would happen, but it is confirmed! We have relied mainly on export to achieve growth in recent years. But this source of economic growth is shrinking catastrophically. In April, our exports fell by 20.2% and imports - by 32.4%.

We have a reduction not only with the EU countries but also with third ones. An economy that relies on growth thanks to government spending and EU money is doomed. For example Greece and other southern European countries," Prof. Bobeva said.

 

According to Daniela Bobeva, the ruling party's claim that early elections and a caretaker government would pose greater challenges to the economy "brings back memories of socialism" when protests were banned.

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