EBRD Predicts 2.6% Economic Growth for Bulgaria in 2011

Bulgaria can achieve economic growth of 2.6% in 2011, according to the forecast of the European Bank for Reconstruction and Development (EBRD).

The Bank's chief expert, Erik Berglof, however, warns the country is facing significant challenges while the biggest source of alarm is the possibility for the lessons from the crisis to not transfer into reforms.

"Prices are going up and the negative effects of the crisis are fading away too slowly," Berglof says.

The expert points out exports are important not only for the economic growth, but for innovations and recommends improving the business environment, the efficiency of the Customs Agency, the capital markets in the entire region, and removing bureaucratic hurdles.

Finance Minister, Simeon Djankov, says the cabinet of the Citizens foe European Development of Bulgaria (GERB) party took office in the worst of the crisis and the first thing they did was to reduce budget expenses.

The Minister reiterated taxes would not go op and promised reforms to avoid higher taxation, adding Bulgaria is the country with the lowest taxes in the European Union precisely because of these efforts of the government.

Djankov further points out the retirement and the administrative reforms as successful, but admits a lot still needs to be done in terms of the health care and education ones.

"I hope after the crisis Bulgarians will end up being more fiscally disciplined," the Minister said.