June 8 (SeeNews) - Bulgaria's real gross domestic product (GDP) is expected to expand by 2.6% in 2022, the World Bank said on Wednesday, revising downwards its January forecast by 1.2 percentage points in line with a more pessimistic view of the global economy as a consequence of the ongoing war in Ukraine.
The country's economic growth is projected to speed up to 4.3% in real terms in 2023, before slightly slowing down to 3.7% in 2024, the World Bank said in the June 2022 edition of its Global Economic Prospects report published on Tuesday.
The lender reiterated its 2022 GDP projection for Bulgaria which it made in the spring edition of its Europe and Central Asia (ECA) Economic Update in April.
Bulgaria's economic output is estimated to have increased by 4.2% in 2021, the latest report showed.
The World Bank's estimate is somewhat less optimistic than the Bulgarian government's projection for a 2.9% growth in 2022 GDP, which is forecast in the current budget revision draft to be submitted to the parliament for approval.
The Russian invasion of Ukraine has compounded the effects of the COVID-19 pandemic for the countries of Central Europe as a whole -- Bulgaria, Croatia, Hungary, Poland and Romania, by pushing up commodity prices and inflation, causing an influx of refugees and lowering demand from euro area countries, the World Bank added. The economies of the Central Europe countries are, however, expected to benefit in the medium term from EU funding under the National Recovery and Resilience Facility.
"Energy supply disruptions could put additional strains on production and exacerbate upward pressures on prices, especially in light of Russia’s cutting off direct natural gas exports to Poland and Bulgaria and the EU’s announced plans to ban or phase out fossil fuel imports from Russia by 2027," the World Bank said.
Economic growth in Central Europe is forecast to slip to 3.7% in 2022 from an estimated 6.2% in 2021, and to remain at that level through 2024.
On Wednesday, the National Statistical Institute (NSI) said that Bulgaria's real economy expanded by an annual 4.0% in the first quarter of 2022, lowering an earlier flash estimate by 0.5 percentage points.