From now on, the International Monetary Fund will review Bulgaria’s economic policies once a year, as it does with other European Union members, the Finance Ministry said in an e-mailed statement yesterday. Bulgaria joined the EU on January 1. Bulgaria’s current-account gap widened to an eight-year record of €3.87 billion ($5.2 billion), or 16% of GDP, last year, topping the government target of 14.1%. Bulgaria aims to narrow the deficit to 13.% of GDP this year, 12.8% in 2008 and 12.4% in 2009 on expectations its new EU membership will help boost trade.
Bulgaria had a budget surplus of 3.5% of GDP last year and has planned a surplus of about 1% of GDP this year. The IMF has urged the government to sustain a budget surplus of more than 2% of GDP. Bulgaria had record foreign investment of €4 billion last year, which covered the current-account shortfall. EU membership spurred foreign investment as more foreigners invested in Bulgarian real estate and new factories. (Bloomberg)
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