Assetz® News - Bulgaria enjoys strong economic growth

Bulgaria enjoys strong economic growth

19th June 2006 |

The property investment industry in Bulgaria has received something of a helping hand with news of significant economic development in the first quarter of 2006.

The Nation Statistics Institute has reported today that gross domestic product (GDP) in the first quarter grew by 5.6 per cent when compared to the same period last year. As reported by the Associated Press, Bulgaria's GDP reached 9.815 billion leva (£3.4 billion) in the period, with several sectors contributing.

Growth of 5.6 per cent was reportedly assisted by an increase of six per cent in the services sector and 8.8 per cent in industry, although the agriculture sector struggled with a slump of 2.7 per cent.

Economic growth in last year as a whole was 5.5 per cent and economic forecasts suggest this will be repeated again this year as Bulgaria continues to boost its standing in preparation for EU accession. Its reputation has also been aided by improvements to its employment figures, with the unemployment rate in May falling to 9.6 per cent – the lowest since 1991.

The rising employment figures, to some extent, reflect the growing demand to accommodate overseas visitors and investors. The summer months have inevitably sparked enthusiasm for some of Bulgaria's beach resorts and the Black Sea coasts are always popular in this respect. Analysts also suggest that employment figures will be boosted by the construction industry, as firms seek to cater for the rising demand for investment properties.

Construction on a particularly large scale is expected to be seen in the popular ski resort of Borovets in the months to come, reports the Sofia Echo today.

It is thought that the government will invest more than one billion leva to expand the resort and put it in a position to rival Bansko and some of the other most popular ski resorts in Europe.

It is an investment project that will reportedly be centred on adding 140 kilometres of ski tracks. This in turn will spur the construction of several hotels in the area, with a capacity for over 25,000 beds.

Angel Nikolov, mayor of Samokov, said that there are also plans to construct a new resort alongside the Iskar River. Speaking to Capital newspaper, Mr Nikolov reportedly said that Samakov could house a large business park as well as a modern apartment complex, although these plans are all dependent on Sofia managing to attract the Winter Olympics in 2014.

It is a bid that has today received the support of Bulgaria's top football players, who today congregated in Sofia to offer their assistance in promoting the country's case. The Sofia News Agency reports that the players are hoping that a successful bid will lead to a recreation of the good-feeling that spread through the country when the national football team finished fourth in the 1994 World Cup in America.

Bringing the Winter Olympics to Bulgaria would be a huge move in terms of the country's popularity as a property investment hotspot. Experts suggest that EU accession next year will provide the initial catalyst for house prices in the country and it is thought that the excitement generated by a successful Olympic bid will contribute further to a property boom.