Fitch: Bulgaria Still Competitive Despite Current Account Deficit
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Global credit rating agency Fitch said that Bulgaria's economy remained competitive despite accruing a massive current account gap."Despite disconcertingly high current account deficit, Bulgaria is seeing strong export growth and rising export market share, suggesting the real economy remains competitive," the head of the agency's sovereign ratings division.According to the report, the deficit, which reached 16,3% last year, is a reflection of booming domestic demand, not a crisis of competitiveness.Trade deficits have grown because soaring domestic demand has pushed imports ever higher, but export growth was still a solid 21% in 2006."Ultimately, external imbalances on this scale are unsustainable and will need to be corrected at some stage,". The report says that the current developments were in line with the scenario of gradual adjustment and convergence with western European living standards.Fitch rates Bulgaria at BBB with a stable outlook in the investment-rating category. |
