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Fri, Mar 12 2010
Bulgarian households lose 83 billion leva in recession
Unemployment has been rising everwhere, including the UK
Bulgarian households have seen 83 billion leva wiped off their incomes after the property market burst, reducing prices by about 20 per cent.
This represents 130 per cent of the nation’s gross domestic product (GDP), said Kristofor Pavlov, chief economist with UniCredit Bulbank.
Speaking at a Euromoney forum on the economic crisis, Pavlov explained that hard times have prompted households to save more and consolidate debts.
Savings currently account for about six to seven per cent of Bulgarians’ disposable income. About 70-80 per cent of households' financial assets are parked with deposits and so domestic demand would not help the economy recover, Pavlov predicted.
Unemployment is expected to peak in 12 months and the crisis will hit hardest in 2010, Pavlov forecast.
He said the Bulgarian economy would pull itself out of recession in the second quarter of next year but recovery would be painful.
UniCredit calculated that Bulgaria’s GDP would contract by 2.5 per cent in 2009, dragged down by the services sector.
The rebound will be spearheaded by the corporate sector and industry, according to Pavlov. Infrastructure projects will be the engine behind the rebound and a full absorption of European funding allocated to Bulgaria until 2013 will bolster GDP by four per cent, he added.
This represents 130 per cent of the nation’s gross domestic product (GDP), said Kristofor Pavlov, chief economist with UniCredit Bulbank.
Speaking at a Euromoney forum on the economic crisis, Pavlov explained that hard times have prompted households to save more and consolidate debts.
Savings currently account for about six to seven per cent of Bulgarians’ disposable income. About 70-80 per cent of households' financial assets are parked with deposits and so domestic demand would not help the economy recover, Pavlov predicted.
Unemployment is expected to peak in 12 months and the crisis will hit hardest in 2010, Pavlov forecast.
He said the Bulgarian economy would pull itself out of recession in the second quarter of next year but recovery would be painful.
UniCredit calculated that Bulgaria’s GDP would contract by 2.5 per cent in 2009, dragged down by the services sector.
The rebound will be spearheaded by the corporate sector and industry, according to Pavlov. Infrastructure projects will be the engine behind the rebound and a full absorption of European funding allocated to Bulgaria until 2013 will bolster GDP by four per cent, he added.
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Appointments
Electricity System Operator
Ivan Yotov is the new executive director of Electricity System Operator, a subsidiary of the national grid operator National Electrical Company. For more than 16 years Yotov has worked for NEC, holding a number of executive positions. He has a degree in electrical engineering from the Technical University in Gabrovo. He also has a degree in finance from Veliko Turnovo University.
Empower United
Svetla Stoeva is the new head of sales and marketing director at Empower United foundation. She was previously in charge of sales and key customers accounts at JobTiger, an online-based job search engine, where she has been a partner since 2005. Before that she worked for United Parcel Service. Stoeva has a degree in Anglican and American studies from Sofia University St Kliment Ohridski.
Emmis Bulgaria
Nikolai Stoyanov is the new programme director of radio stations Radio FM+, Radio Fresh! and Radio Star FM, all three of which are owned by Emmis Bulgaria. Stoyanov will be responsible for the overall programme development of the three radio stations and their music policy. Stoyanov has been programme director of Radio Fresh since 2008. Before that he held the same position at Radio City and Radio Plus (which was later transformed into Radio Fresh). He has been a radio host for a number of years and is the author of The Big 50 music chart. Stoyanov has a degree in radio management.
Konrad Adenauer Sofia
Matthias Barner, the spokesperson of the German Christian Democratic Union party, is the new director of the Sofia-based media office of the Konrad Adenauer Foundation for Southeastern Europe. Barner replaces the journalist Dirk Foerger who has been head of the foundation Bulgarian office since its establishment in 2007. Barner has a degree in political science and has worked as a PR consultant.
PRO.BG
Ralina Tropankeva has joined the team of PRO.BG Bulgarian TV channel as producer of its news department.
Tropankeva comes from national private broadcaster Nova Televisia where for the past five years she has been news editor and producer. Before that, she was editor and editor-in-chief of a morning TV talk show.
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It's bad everywhere. That photo up there isn't BG you know...
Well said, expat.
The construction sector will be dying for another 3 years. The tourism industry will not start until there is something to offer them.
"...He said the Bulgarian economy would pull itself out of recession in the second quarter of next year but recovery would be painful."
I will be very much interested if and how this will happen - pulled itsef out of recession. I strongly hope he is right, but I have deepested doubts on this. What industry will be the driver for this, construction (hardly), service (fist have to improve quality), tourism (very unlikely, because of overbuilding and low service quality), industry? (too low productivity). and all this in combination with a strong EUR begged currency...
I fully agree it will be very, very painful and not only in 2010 but also the upcoming years....
This is a very simplified way to price losses. It suggests that liquid money has disappeared while in fact reference is made to the value of real estates, which has been traded on a small scale and has been heavily overpriced anyway in this country. It is also not direcly related to GDP losses, as one can understand later from your message.