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Political instability to slow Bulgaria's economic growth to 2.0 pct in 2017: expert

Xinhua, November 22, 2016 Adjust font size:

The resignation of Bulgarian government last week and the looming political instability could slow the country's economic growth to 2.0 percent in 2017, an expert said here on Tuesday.

According to the latest forecasts of the European Commission, the International Monetary Fund and the Bulgarian Ministry of Finance, the country's growth will be between 2.5 percent and 3.0 percent, Desislava Nikolova, chief economist at the Institute for Market Economics (IME), told a press conference.

"But what must be borne in mind is that these forecasts were made before the resignation of the government," Nikolova said.

When Bulgarian governments resigned and early parliamentary elections were held in 2013 and 2014, the political instability pulled down the growth, she said.

The instability affected mostly the investment environment and led to the postponement of large investment projects, both public and private, Nikolova said.

Furthermore, the Bulgarian economy would be affected in 2017 by international negative factors such as Brexit, the expected increase in energy prices and the ongoing appreciation of the euro, Nikolova said.

Growth of around 2.0 percent in 2017 is a realistic forecast for Bulgaria, she concluded.

Bulgaria's economy grew by 3.0 percent, 1.5 percent and 1.3 percent in 2015, 2014 and 2013 respectively. Endit