Economic Policy Review ISSN 1313 - 0544

Status quo

29.01.2007
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Status Quo

The Bulgarian economic reforms (1993-1997) have one specific feature – thanks to egoism and the subjective choices of different governments in country, the possibilities of people and companies to live better, as in the other countries, was destroyed.

Economically and statistically it appears that:

1) the Bulgarian economy doesn’t take advantage of its potential for economic growth
2) Accumulation of capital costs too much time
3) The net creditors of the Bulgarian economy are relatively insignificant

From 1998 and particularly from 2001, the tax burden over these net creditors has increased sharply.

From the table below we can see that the aggregate growth of GDP in Bulgaria is two or three times smaller than other European countries.

GDP and growth per capita

Country

GDP per capita 1991 ($)

GDP growth per capita

(1991-2003), % average value

Slovenia (1992)

8 710,6

1,05

Litva

3 218,5

-0,49

Macedonia

2 764,9

-0,72

Poland

2 771,9

3,68

Rumania

1 484,2

0,19

Sarbia/MonteNegro (1996)

1 709,5

1.5

Latvia

3 245,6

0,74

Estonia

3 534,6

1,34

Bulgaria

1 586,9

0,48

Hungary

4 287,6

1,56

Slovakia

3 637,1

1,05

Croatia

4 538,4

0,4

Czech Republic

4 681,5

0,82

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Source: World Bank

 

What is more important? If Bulgaria is to catch up with the economic reforms, as the new European members have already done, economic growth still can be achieved.

The Major areas of reforms are:

1)Decrease of the tax burden
2) Pension reform
3) Health care
4) Social activities