A 1.7% GDP growth in 2014 is what Eurostat reported for Bulgaria, which surpasses all expectations both of the Bulgarian Government and the international financial and economic institutions. This achievement is even better than the European average of the 28 member states. 2014 is the fifth consecutive year with an increase in GDP after the economy contracted by 5% during the most severe crisis in 2009. In 2010, the real growth was 0.7%, in 2011 - 2%, in 2012 and 2013 respectively - 0.5% and 1.1%.

This modest and inadequate, albeit commendable macroeconomic indicator is more indicative of the Bulgarian economy that has embarked on the road of moderate growth, given that last year from a political point of view was a year of real testing of the business conditions as it was a period of extreme volatility in which three different governments were in power and elections were held twice. The business sector finds it difficult to bear the political upheaval, as they only create further uncertainty in an already unstable economic environment.

According to Eurostat, last year the national economy in Bulgaria has created a Gross Domestic Product worth 42 billion euros as € 5,808 goes per person. Not a lot as it is known that in prosperous Luxembourg, the GDP per capita exceeds € 100,000, but in contrast Bulgaria is in the group of EU members where there is still growth but not a recession or stagnation.

Considering the good results of last year, the forecasts for economic growth this year look embarrassing. The government is too cautious and expects an economic growth of around or below 1%. Quite modest are also the expectations of international observers, led by the President of the European Commission, Jean-Claude Juncker, who warned that the outlook for the Bulgarian economy was not good. The Vice-President of the EC in charge of budget and human resources Kristalina Georgieva also warned of the hazard of lower growth rates in Bulgaria.

But as a counterpoint to the general pessimism there are first signs that the initial low estimates may this time be exceeded. There are already indications that the domestic demand has intensified not without the support of the extremely low interest rates on loans and deposits. Consumption growth has the most direct impact on government revenue from VAT in the budget that go up, filling the state funds. And full state treasury means more public investment, i.e. more jobs and better wages. To this should be added the restored European funding of projects under different programs, financing which also leads to the already established reduction in unemployment and an increase in business activity. The controversial new external and internal debts for EUR 8 billion whose ratification by parliament almost blew up the ruling coalition and took down the second government of Prime Minister Boyko Borissov, actually from a different perspective only stabilize the situation in the country. Its debt will not increase to unacceptable levels, but instead it will reduce the budget deficit and will provide guarantees to the businesses for solvency of the public sector. These are positive signals, which cannot help but stimulate business activity. In this direction, we see also stable exports primarily to EU partners. We should not forget also the seemingly serious ambitions of the government to finally reform the most ineffective social structures and systems.

English Rossitsa Petcova