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Bulgarian economic development and EU integration. How FDI and EU structural

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  • Iskra CHRISTOVA-BALKANSKA

    () (Economic Research Institute, Bulgarian Academy of Sciences)

Abstract

The aim of this research is to focus on Bulgaria’s macroeconomic development as an EU Member State and to focus on the results, which Bulgaria has achieved during the process of economic catching-up to the other, more developed economies. Bulgaria’s economic development depended and still depends on the inflow of fresh financial resources for restructuring the economy and deepening the process of integration with the other EU Member States. That is why the inflow of foreign capital in the form of direct foreign investments (FDI) has become one of the main tools for impacting and stimulating the industry and the services sectors in the country, both on a national and on a regional level. As a country suffering from a shortage of funding, Bulgaria is in need of significant investments in priority sectors of the economy. In this regard, what remains of crucial importance for the country is the utilization of financial resources under the Operational Programs (OPs) of the European Structural Funds (ES), which emerged as almost the only source of funding for major projects of the Bulgarian economy and a means for addressing the country’s lagging behind in different spheres of economic life in the years following the economic crisis. Thus, this research is aimed at showing the extent to which Bulgaria has managed to get closer to the level of economic development of the other Member States, and especially to that of the other Eastern European countries. This research aims to show how FDI and financing under the ESF have attributed to the economic development and growth of the Bulgarian economy. The first part of this research is dedicated to the presentation of the economic situation in Bulgaria, mainly in the period after the economic crisis, and the problems related to the economic catch-up. The second part tries to show the extent to which FDI and EU Structural and Investment Funds (ESIFs) have helped the process of economic development and growth in Bulgaria during the process of economic integration to the EU.

Suggested Citation

  • Iskra CHRISTOVA-BALKANSKA, 2016. "Bulgarian economic development and EU integration. How FDI and EU structural," Romanian Journal of Economics, Institute of National Economy, vol. 42(1(51)), pages 36-69, june.
  • Handle: RePEc:ine:journl:v:42:y:2016:i:51:p:36-69
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    References listed on IDEAS

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    1. Zaman, Gheorghe & Georgescu, George, 2014. "The absorption of EU Structural and Cohesion Funds in Romania: international comparisons and macroeconomic impact," MPRA Paper 57450, University Library of Munich, Germany.
    2. Konstantins Benkovskis & Julia Wörz, 2012. "Non-Price Competitiveness Gains of Central, Eastern and Southeastern European Countries in the EU Market," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 3, pages 27-47.
    3. Caves, Richard E, 1974. "Multinational Firms, Competition, and Productivity in Host-Country Markets," Economica, London School of Economics and Political Science, vol. 41(162), pages 176-193, May.
    4. Paul de Grauwe & Gunther Schnabl, 2004. "Nominal versus Real Convergence with Respect to EMU Accession.How to Cope with the Balassa-Samuelson Dilemma," EUI-RSCAS Working Papers 20, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
    5. Mihály Borsi & Norbert Metiu, 2015. "The evolution of economic convergence in the European Union," Empirical Economics, Springer, vol. 48(2), pages 657-681, March.
    6. Gunther Schnabl & Paul De Grauwe, 2004. "Nominal versus Real Convergence with Respect to EMU Accession - EMU Entry Scenarios for the New Member States," International Finance 0403008, University Library of Munich, Germany, revised 16 Feb 2005.
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    More about this item

    Keywords

    Macroeconomic development of Bulgaria; catch-up and cohesion of Bulgaria to the other EU countries; FDI; EU Structural Funds;

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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