In the period January – July 2008, the Current and Capital account deficit was EUR 4,341.2 million (13.2% of GDP1), against a deficit of EUR 3,006.1 million (10.4% of GDP) for the same period in 2007.

In July 2008 the Current account was negative and amounted to EUR 424 million, compared to a negative account of EUR 257.7 million for the same month in 2007. In the period January – July 2008, the current account deficit was EUR 4,556.3 million (13.9% of GDP), against a deficit of EUR 3,093.1 million (10.7% of GDP) for the same period in 2007. The main factor for the increase of the current account deficit was the higher (by EUR 1,405.4 million) trade deficit.

The trade deficit1 in January – July 2008 amounted to EUR 5,190.2 million (15.8% of GDP), compared to a deficit of EUR 3,784.9 million (13.1% of GDP) for the same period in 2007. The trade deficit increase was also due to the increase of crude oil and natural gas prices.

Exports (FOB) amounted to EUR 9,169.4 million against EUR 7,484.8 million for the same period in 2007, increasing by 22.5% y/y against 10.1% for the same period in the previous year. Imports (FOB) amounted to EUR 14,359.6 million, against EUR 11,269.7 million for January – July 2007, increasing by 27.4% y/y against 18.7% for the same period in the previous year. The difference in imports growth rates y/y for the reporting period in 2008 and for the same period in 2007 was due to the increase of crude oil and natural gas prices.

The balance on the Services item was positive, amounting to EUR 632.5 million (1.9% of GDP), against a positive balance amounting to EUR 730.3 million (2.5% of GDP) for the same period in 2007.

Income (net) item was negative amounting to EUR 514.4 million compared to a negative item of EUR 212.2 million for the same period in 2007.

Net Current transfers amounted to EUR 515.9 million (1.6% of GDP) against EUR 173.6 million (0.6% of GDP) for the same period in 2007.

The Capital account balance was positive amounting to EUR 215.1 million, compared to a positive balance of EUR 87 million for the same period in 2007.

The Financial account balance was positive amounting to EUR 6,117.9 million, compared to a positive balance of EUR 5,324.1 million for the same period in 2007.

Foreign direct investment abroad was EUR 460 million against EUR 109.7 million for the same period in 2007.1 Foreign direct investment in Bulgaria2 was EUR 2,847.3 million (8.7% of GDP) against EUR 3,325.9 million (11.5% of GDP) for the same period in 2007.

The direct investment covered 62.5% of the current account deficit against 107.5% for January – July 2007. Portfolio investment - assets increased by EUR 137.5 million, compared to a decrease of EUR 7.4 million for the same period in 2007. Portfolio investment – liabilities decreased by EUR 123.5 million. In the period January – July 2007, the liabilities decreased by EUR 53.1 million.

Other investment – assets decreased by EUR 649 million, compared to a decrease of EUR 201 million for the same period in 2007. Other investment – liabilities increased by EUR 3,423.5 million against an increase of EUR 1,999.5 million for January – July 2007.
The item Net errors and omissions was negative, amounting to EUR 96.1 million. For the same period in 2007 the item was negative amounting to EUR 1,140.1 million.

The Overall balance was positive, amounting to EUR 1,680.7 million compared to a positive overall balance of EUR 1,177.8 million for the same period in 2007.

In the period January – July 2008 the BNB reserve assets3 increased by EUR 1,680.7 million.

Source: Bulgarian National Bank