Bulgaria’s economy and employment grew steadily, but labour productivity decreased, a report of the World Bank (WB) on the Bulgaria's productivity challenges released on September 24 2007, said.

The average real growth of GDP between 2000 and 2007 was more than five per cent and 6.4 per cent in the first half of 2007, the report said.

Population’s economic activity increased to 65 per cent and was higher than those in Hungary, Poland and Romania.

More than 400 000 work places had been opened since 2002 and unemployment had decreased to less than seven per cent, the report said.

According to the report there was a risk of the productivity slowing down, which would lead to higher inflation and slower economic growth.

Bulgaria would have to increase its productivity growth to fiver per cent per year, if the country wanted to reach the income levels of the other EU members.

The country should speed up the current programmes for reforms in some fields to overcome that challenge, the report said as quoted by Focus news agency.

The report aims at helping Bulgarian authorities in finding policies and reforms, which will increase the country’s productivity and employment and thus the economic growth.

Bulgaria should emphasise on product markets in the country, labour market development, human resources development, and a system for research and development activity.

Anand Seth, World Bank director for South Central Europe, said the report indicated that high growth was possible in future. That would mean a high productivity growth to compensate the expected decrease in the labour force, he said.