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Bulgaria expects budget surplus of 1.5% of GDP at end-July

Kitco News

SOFIA, July 31 (Reuters) - Bulgaria expects to have a fiscal surplus equal to 1.5% of gross domestic product in the first seven months, compared with a surplus of 2.8% over the same period a year ago, the finance ministry said on Friday.

The Balkan country is still running fiscal surpluses despite the hit from the coronavirus on its small and open economy, data showed.

Sofia registered a fiscal surplus of 1.6 billion levs ($967.00 million) or 1.4% of economic output in the first half of the year, the ministry said in a statement.

Bulgaria plans to end 2020 with a fiscal shortfall of 3% of GDP, as it boosts spending to support jobs and incomes hit by the coronavirus pandemic.

Government revenues were 21.4 billion levs at the end of June, down 855 million levs from the same period in 2019. Spending was 19.8 billion levs, up from 19.1 billion a year ago, mainly due to an increase in public pensions and other social spending, the finance ministry said.

Fiscal reserves, held under a currency regime pegging the lev to the euro, stood at 9.89 billion levs at the end of June.

The government expects the coronavirus crisis to shrink the country’s economy by 3% this year. The European Commission is less optimistic and sees Bulgaria’s gross domestic product down 7.2% in 2020. ($1 = 1.6546 leva) (Reporting by Tsvetelia Tsolova; Editing by Alex Richardson)

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