Cause and Effect in European Politics and Law

The recovery has started. Where is Bulgaria?

Adelina Marini, September 2, 2009

The Agency for economic analyses and forecasts has prepared its macroeconomic forecast for Bulgaria for the period 2010-2013 based on the assumption that the recovery of the world economy is expected to start in 2010 "because of greater dynamics of the development of the developing countries". The forecasts indicates that the European economy is expected to contract with 4% in 2009 and with 0.1% in 2010. In 2011 it is expected the European economy to start to grow with 2%.

In an analysis the Carnegie endowment for international peace says that Asia will not pull the rest of the world out of recession on its own. "Despite growth in China and the rest of Asia, the impact that a “rebalancing” of global trade with Asia will have on recovery in the rest of the world should not be overestimated." The authors of the analysis point out that the main driver of a sustained recovery must be domestic private demand, and first and foremost private consumption. This, in turn, will depend on the confidence and speed at which households and banks restore their balance sheets to health.

The Carnegie endowment also believes that confidence in Europe is improving swiftly, while the data on U.S. consumer remain mixed.