“Regional Profiles: Indicators of Development 2012”

The study “Regional Profiles: Indicators of Development 2012” was presented in the beginning of November in Sofia.

The study was carried out by the Institute for Market Economics and its partners from Microstat Analytics with the financial support of the “America for Bulgaria” Foundation.

It provides a snapshot of the socio-economic conditions of Bulgarian districts as of mid-2012, as well as their development since the year 2000.

The profile of each district consists of an overview and commentary on the more notable results and trends in each of the 8 categories of indicators: economy, business environment, infrastructure, demographics, education, health, environment, and social environment. The analysis of available statistical data, as well as the results of IME own field research, revealed a very diverse picture of regional development, which we present in each of the profiles. 

In addition to the 28 district profiles, the study includes thematic analyses on topics such as:

 

The study seeks answers to important questions such as:

  • What makes some districts more developed and prosperous, while others end up less developed and poorer?
  • Which are the districts with higher perception of corruption?
  • Which are the districts with most favourable business environment in Bulgaria?
  • What are the demographic tendencies in each of the districts?
  • Which districts follow similar development patterns and why?

 

Main results

  • The gap between rich and poor regions is increasing both in the period of economic boom and in the period of crisis;
  • The number of regions with poor socio-economic profile or negative development trends is much bigger than the number of those with good socio-economic profile or positive development trends;
  • Demographic developments have extremely strong and usually negative impact on the economic development of the regions;
  • In spite of rather prolonged negative developments in the poorest regions, the majority of local population has rather low mobility;
  • Proximity to Sofia (the capital) does not have a one-way effect on all of the neighbouring regions and does not automatically bring advantages to them;
  • The central government still plays a major role in local policies; this can be attributed to the unwillingness to delegate more powers to the local authorities;
  • Even though local policies are restricted by law, they can have a paramount impact on living conditions and the business environment;
  • Data is extremely scarce on regional level, and sometimes its quality is questionable, which casts doubt on the ability of the government (both central and local) to take informed decisions.

 

Recommendations:

  • A policy cannot have the same effect on all regions, therefore a higher degree of decentralization of the decision-making process is necessary;
  • Real financial independence of the regions is needed; this will allow for differentiated local policies;
  • Parliament should not be able to define the limits of local taxes – the decision and the responsibility for them should be delegated entirely to the local authorities;
  • The regions should benefit from economic development – i.e. they should be entitled to a part of the revenues from as many taxes as possible, especially those connected with local economic activity (for instance, a part of the revenue from VAT, income taxes, corporate profit taxes etc.)
  • Powers of regional authorities with regard to raising revenues and allocating expenditures should be balanced in such a way that they can become more independent from central government transfers;
  • Powers of municipal authorities regarding local economic and social policies should be increased.

 

Our Goal

 The availability of detailed information about the characteristics, condition and prospects of all regions in a country are an important prerequisite for the promotion of investment and the increase of transparency and accountability of public policies at the local level. The goal of IME team is to make all data and analyses understandable and useful for foreign investors, entrepreneurs and other stakeholders. Moreover, it will provide useful insight for policy makers when taking decisions.

The full English version of the study "Regional Profiles: Indicators of Development 2012" will be available in the beginning of December 2012 for free download from the website. This will include translated charts, graphs and separate PDF files for each of the 28 districts in Bulgaria, as well as the full report itself.

 

For more information:

Desislava Nikolova

chief economist

dnikolova@ime.bg

02/952 62 66

Petar Ganev

senior economist

ganev@ime.bg

02/952 62 66

Yavor Alexiev

economist

yavor@ime.bg

02/952 62 66