THE PROBLEM OF THE CURRENT ACCOUNT DEFICIT IN BULGARIA

CHAVDAR NIKOLOV

 

Abstract

The present paper illustrates the views of the author about the cause for the current account deficit in Bulgaria. The usual public explanation of the problem here is that the current account deficit is a result of the low competitiveness of the country’s export. The author’s analyses shows that the main factor for the deficit is the inflow of the foreign investment and the growth of the foreign debts of the private non banking sector in Bulgaria. This conclusion could be of very high importance for a revision
of the fiscal policy in the country of the last years, because it gives valuable arguments against the practice of the budget surpluses.

 

Key words

interdependence between passive in the current account and the inflow of FDI in Bulgaria

 

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