site.btaWorld Bank Lowers Significantly Bulgaria's 2025 Economic Growth Forecast

Global economic growth will slow to 2.3% on average in 2025-2026, down from 2.6% in 2024, says the World Bank’s economic update titled Accelerate Growth through Entrepreneurship, Technology Adoption, and Innovation, published on its website. The document lowers significantly its forecast for Bulgaria’s GDP growth in 2025 compared to 2024.

The expected global slowdown reflects a sharp and broad-based deceleration across many leading economies, according to the World Bank. This growth rate is over 0.5% lower than the average global growth rate for the 2010-2019 period. The slowdown is due to increased uncertainty in trade policy, driven by the lingering effects of recent shocks. Key growth drivers such as investment and international trade are also showing prolonged weakness, the report’s authors note.

The World Bank forecasts that Bulgaria’s GDP growth will slow down to 1.6% in 2025, following a growth rate of 2.8% in 2024. The 2025 forecast has been revised downward by 1.2% compared to the World Bank’s January projections.

The International Monetary Fund (IMF) projects that Bulgaria’s economic growth will slow to 2.5% in 2025, down from an estimated 2.8% in 2024, according to the spring edition of the World Economic Outlook, released earlier this week.

The Bulgarian National Bank (BNB) has revised its expectations for Bulgaria’s 2025 growth upward, now forecasting a 2.8% increase in GDP, compared to the January forecast of 2.5%.

Looking ahead to 2026, the World Bank expects further deceleration in Bulgaria’s economic growth, with GDP rising by just 2.1%. This is a downward revision of 0.6% from the January forecast.

The World Bank also highlights Bulgaria’s past GDP growth rates: 7.8% in 2021, 4.0% in 2022, and 1.9% in 2023.

Investment levels in Bulgaria remain low, accounting for 18% of GDP in 2024 - below the EU average of 21%. This gap hampers long-term economic growth, the report notes.

Labor productivity in Bulgaria is weak. Output per worker has declined over the past 15 years, indicating insufficient structural reforms and low productivity in the private sector, according to the report.

Regarding the euro zone, the World Bank warns that growth prospects for the currency union are deteriorating due to rising global trade barriers, political uncertainty, declining competitiveness, and weakening consumer and business sentiment.