Economic recovery in Bulgaria is underway, Finance Minister Simeon Dyankov told a discussion in Parliament on March 11 2010, while economists and minority party politicians held a grimmer view.

Bulgaria's gross domestic product (GDP) for 2009 amounted to 66 256.27 million leva or 33 876.3 million euro (4466.1 euro per capita) at current prices, the National Statistical Institute said on March 11. In real terms, 2009 GDP contracted by five per cent from 2008, Bulgarian news agency BTA said.

At a news conference the same day, the Confederation of Independent Trade Unions in Bulgaria said that in 2009, the number of workers hired was seven per cent less than in 2008, meaning that about 172 000 jobs were lost in 2009.

"In May, the budget deficit is expected to be narrower from the first two months of the year and in April we’ll come out of the red," Dyankov told MPs, according to a report by Dnevnik.

Meanwhile, participants at a discussion hosted by political party Union of Democratic Forces (UDF), economists and employers’ groups sharply criticised the proposed increase in the "healthcare tax."

"We sense panic and chaos in what the government is doing. The piecemeal approach and the lack of a clear vision for tackling the downturn could trigger a new wave of the crisis," UDF leader Martin Dimitrov said.

The party put forward a stimulus package, where update of the budget takes centre stage or else Bulgaria will be in for a huge deficit and a new turmoil modelled on Greek developments, Dimitrov said.

His opinion was echoed by business representatives and economists from the Open Society Institute (OSI) and independent economic policy think tank Institute for Market Economics (IME).

"The budget is gasping for breath. All those illusions for higher revenue from excise duties have vanished into thin air," according to Bozhidar Danev, chairperson of the Bulgarian Industrial Association (BIA).

Danev said that Bulgaria could be one in a handful of countries in the world where the economic crisis could spawn financial meltdown and not the other way round.

Meanwhile, writing in Bulgarian-language mass-circulation daily 24 Chassa, Milen Velchev, who was finance minister in the Simeon Saxe-Coburg cabinet from 2001 to 2005, cited unofficial information as showing that in January and February the annual deficit enshrined in law was exceeded, as was the 1.8 per cent projection of the IMF.

Velchev said that businesses should be paid overdue obligations, pension reform should be launched, privatisation and concession awarding should be stepped up, health insurance contributions should be left unchanged, the business environment should be liberalised, and at least a billion euro should be provided in fresh external resources, and the Bulgarian Development Bank should provide long-term loans to businesses.

Experts polled by Dnevnik in February 2010 said that Bulgaria's economy would deteriorate by five per cent for the year.

In the fourth quarter, the economy shrank by 5.9 per cent year-on-year, compared with a flash estimate of 6.2 per cent.

According to the latest statistics, the value of the goods and services produced in Bulgaria in 2009 totalled 66.256 billion leva by current prices. The revision calculated produce worth 59 million leva, which was absent from the earlier calculation.

The year 2009 was a tough one for the Bulgarian economy, which relied heavily on foreign markets and construction. Recession pummeled demand by the country’s major trading partners as the building sector suffered a sharp slowdown against the six per cent rise posted for 2008 when the crisis broke.

Analysts point to mounting joblessness that caused households to snap up their purses as another factor for the economic decline. Investment, industrial production and lending also lost momentum in 2009, according to NSI figures.

For 2010, the Bulgarian economy is expected to eke out a fragile increase.

Agata Urbanska, emerging markets analyst with ING Bank, told news agency Reuters that Bulgaria’s GDP could rise by 0.2 per cent in 2010.

Analysts with The Economist expect a better, 0.6 per cent rebound.