Bulgaria’s economy shrank by 4.2 percent y/y for the first half of the year and 4.9 percent y/y in the second quarter, the country’s National Statistics Institute (NSI) revealed last week. In the first quarter, gross domestic product was 3.5 percent down compared to the same period of 2008.

Source: Bulgarian National Statistics Institute

In absolute terms, first-half GDP was BGN30.3 ($22.5, zł.64.29) billion and second-quarter GDP was BGN16.3 ($12.14, zł.34.62) billion. In the first half of 2008, the Bulgarian economy grew by 7.1 percent, buoyed by the momentum accumulated during years of cheaply-available credit. The country officially entered recession in the first quarter of 2009.

The biggest decline was posted by industry, which shrank by 9.7 percent y/y in the first half of 2009. The agriculture sector shrank by 5.8 percent, while the services sector posted an annual increase of 1.9 percent in January-June, the NSI said in a statement.

Consumption, which has been one of the main drivers of economic growth in recent years, was down 4.5 percent in the first half of 2009. Investment was down 15.4 percent.Exports shrank by 16.5 percent y/y in the first half, while imports were down by 22.7 percent. Nevertheless, Bulgaria still had a trade gap of BGN4.36 ($3.24, zł.9.25) billion for the first half of the year, down by 45.5 percent y/y.

Alex Bivol

This is an edited version of an article which originally appeared in The Sofia Echo