Raiffeisenbank: Bulgaria's Economy to Grow by 3% 2011

Raiffesen Bank Bulgaria has dropped its expectations for the county's economic growth in 2011 from 3% to 2.7%.

The bank's monthly analysis states that the external economic environment is favorable for the development of Bulgaria's economy, but that the recovery from the financial crisis will hardly be felt in the internal market.

In 2010's third quarter, the country saw a 1% economic growth year on year, in comparison to 0.5% in the previous quarter. The main reasons for that was the fast increase in exports and the development in the agricultural and service sectors.

The consumption in Bulgaria has worsened, which has led to savings increasing to as much as 22% of GDP between October 2009 - September 2010. In comparison, the percentage was 9 in 2007.

According to Raiffaisen Bank Bulgaria, the tendency of increased household savings has probably brought about a further drop in interior demands, which is expected to have led to a 0.2% decrease in GDP. The GDP is estimated at BGN 194 B.

On Wednesday, Economy and Energy Minister Traicho Traikov stated Bulgaria's economy will register growth between 2% and 3.6% in 2011.