OECD Economic Survey of Bulgaria: Robust Recovery Interrupted by Global Energy Crisis, Corruption Imposes High Transaction Costs on Businesses

Bulgaria’s robust recovery has been interrupted by the global energy crisis, the OECD said in its Economic Survey of Bulgaria. The survey was published on the organization's website on 4 April as the highlights were presented in Sofia by OECD Secretary-General Mathias Cormann and Prime Minister Galab Donev.

The report also says that corruption imposes high transaction costs on Bulgarian businesses.

Here are the survey's highlights:

• Short-term supports need to be carefully designed and a sound path for the public finances ensured;

• Structural reforms would boost growth;

• The workforce is shrinking and ageing;

• A strategy to reach net-zero emissions is needed. 

As he presented the survey in Sofia, Mathias Cormann said that Bulgaria has made some progress in the fight against corruption but further action is needed. He added that corruption must be curbed as it has a heavy price and that it should be prosecuted at all levels and in all positions.

Bulgaria maintains macroeconomic stability, has been gradually progressing for several decades now, reached GDP growth of 2.3% and per-capita income has increased. The national economy started to recover very quickly after the pandemic, but this was interrupted by the global energy crisis and the aftermath of Russia's aggression in Ukraine. This situation can be seen in other countries in the region and across Europe but the closer the country is to Ukraine, the stronger this is felt, the OECD Secretary-General said.

He outlined the main challenges this country needs to overcome to move forward. Spending needs must be met; fiscal discipline must be ensured; tax compliance must improve and undeclared wage payment must be addressed; spending on social support needs to be increased. 

The minimum wage in Bulgaria is low, according to Cormann and the OECD. Inequalities in disposable income are high, he added.