Soaring public spending under the weight of the economic crisis, red tape and job market hurdles have crippled economic freedom in Bulgaria, according to Petar Ganev, economist with independent economic policy think-tank Institute for Market Economics (IME).

IME is the Bulgarian partner of Canadian conservative think-tank Fraser Institute, which has just published its latest report on worldwide economic freedom.

"Over the past three to four years, Bulgaria has slowed down the pace and policies implemented in response to the crisis in 2009 and 2010 have already robbed us of our economic freedom," IME argues.

"What is more, no progress was made during the past decade in our weakest indicators and serious problems remain in the judiciary (independence and objectivity), protection of the right to ownership, bureaucratic bottleneck and corruption."

In the Fraser report, Bulgaria moved up from 41st to 36th spot in terms of economic freedom but the assessment was made based on its 2008 macroeconomic data.

Ganev said that over the past two years, Bulgaria has lost some of its economic freedom, which means it will take longer to wrench its economy out of recession. "Among the key factors are excessive government spending that increased due to the crisis as well as the state of our labour market," he told Dnevnik.

Bulgaria should focus its efforts on achieving unbiased and independent judiciary that will guarantee the rule of law, according to IME.

It recommended that Bulgaria stick to the currency board pegging the lev to the euro but introduce also a fiscal board that will keep government spending in check. The introduction of online administrative services and revision of the current labour market policy are other measures that could help Bulgaria increase economic freedom, IME says.

Source: Dnevnik.bg