Growth is projected to slow to 1.9% in 2023 due to global headwinds, including the slowdown in Bulgaria’s main trading partners, but then rebound to 3.2% in 2024. Private consumption growth will slow in line with lower employment growth. The disbursement of EU funds was delayed in 2022, but is expected to catch up to a large extent in 2023. Inflation is expected to moderate in 2023 and in 2024, but there are risks from high wage increases.
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The pandemic risks interrupting impressive income convergence and raises the urgency of making growth more inclusive. Addressing long-standing patchy coverage of social benefits and improving provision and efficiency of education and training should become top policy priorities in the recovery.
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2021 Structural Reform Priorities