Economy - overview One of the poorest countries of central Europe, Bulgaria has slowly been moving from its old command economy towards a market-oriented economy. The economy faced a major crisis in 1996, marked by a banking system in turmoil, a depreciating currency, inflation of 311%, and contracting production and foreign trade. Foreign exchange reserves dwindled to $518 million, while dramatically hiked interest rates added to the domestic debt burden and stifled growth. GDP fell by 11% in 1996, after experiencing 2.0% growth in 1995. Privatization of state-owned industries stagnated, although the first auction of a mass privatization program was undertaken in late 1996. Lagging progress on structural reforms led to postponement of IMF disbursements under a $580 million standby loan agreed to in July 1996. In November 1996, the IMF proposed a currency board as Bulgaria's best chance to restore confidence in the lev, eliminate unnecessary spending, and avoid hyperinflation. The board was set up on 1 July 1997. Its establishment was followed by a reduction in inflation and interest rates and by a rise in foreign investment. Simultaneously the government pledged to sell off some of the most attractive state assets. GDP in 1997 dropped 7.4%, but is expected to rebound to an estimated 2% in 1998. Other government objectives include: the completion of land reform, the privatization and strengthening of the banking system, and the modernization of the legal environment of business.

GDP purchasing power parity - $35.6 billion (1997 est.)

GDP - real growth rate -7.4% (1997 est.)

GDP - per capita purchasing power parity - $4,100 (1997 est.)

GDP - composition by sector
agriculture: 12%
industry: 31%
services: 57% (1997 est.)

Inflation rate - consumer price index 579% (1997 est.)

Labor force
total: 3.57 million (1996 est.)
by occupation: industry 41%, agriculture 18%, other 41% (1992)

Unemployment rate 14% (1997 est.)

Budget
revenues: $2.7 billion
expenditures: $3.2 billion, including capital expenditures of $NA (1997 est.)

Industries machine building and metal working, food processing, chemicals, textiles, construction materials, ferrous and nonferrous metals

Industrial production growth rate -7.4% (1997 est.)

Electricity - capacity 12.087 million kW (1995)

Electricity - production 41.449 billion kWh (1995)

Electricity - consumption per capita 4,821 kWh (1995)

Agriculture - products grain, oilseed, vegetables, fruits, tobacco; livestock

Exports
total value: $4.9 billion (f.o.b., 1997)
commodities: machinery and equipment 15.2%; agriculture and food 18.9%; textiles and apparel 14.8%; metals, minerals, and fuels 26.5%; chemicals and plastics 20%; other 4.6% (1996)
partners: OECD 50.0% (EU 37.2%); CIS and Central and Eastern Europe 32.4%; Arab countries 5.8%; other 11.8% (1995)

Imports
total value: $4.5 billion (f.o.b., 1997 est.)
commodities: fuels, minerals, and raw materials 40.7%; machinery and equipment 18.4%; textiles and apparel 11.6%; agricultural products 7.5%; metals and ores 5.2%; chemicals and plastics 12.2%; other 4.4% (1996)
partners: OECD 45.5% (EU 38.1%); CIS and Central and Eastern European countries 41.1%; Arab countries 1.8%; other 11.6% (1995)

Debt - external $10 billion (1997 est.)

Economic aid NA

Currency 1 lev (Lv) = 100 stotinki

Exchange rates leva (Lv) per US$1 - 1,740 (1997), 483.4 (1996), 70.7 (1995), 54.2 (1994), 27.1 (1993)

Fiscal year calendar year

NOTE: The information regarding Bulgaria on this page is re-published from the 1998 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Bulgaria Economy 1998 information contained here. All suggestions for corrections of any errors about Bulgaria Economy 1998 should be addressed to the CIA.