No loans are sought in the longer term:

The results for the second quarter for the Bulgarian economy indicate the abnormal situation with regard to the rates for business loans. There is an increase in investment, of credit, but the interest on short-term loans is much higher than that of long-term loans. This means that the demand is lower, people think that their company will have no projection in the future. And looking for short-term loans means that companies live from today to tomorrow.

This is the opinion of Professor Garabed Minsantin from the Institute of Economics at BAS, as expressed in the program & # 39; World is Business & # 39; from Bloomberg TV Bulgaria.

In his commentary on the results of the Bulgarian economy for the second quarter, he concentrated on inflation, but identified the investment as the most important item.

He points out that the BNB gives no information about the nature of the loans – for their size, but in terms of interest it is logical that the demand for long-term loans is greater than that of short-term loans.

"This is not good for the economy because it grows with long-term loans," Garabad Minsantin said and asked: "Why do companies refrain from investing in long-term investments for future production?" This means that the company assesses the situation in the long term. unfavorable. "

He recalled that the estimates for the future are never covered, but that the indicators are based on business flair vis-à-vis the market.

"The express data released for the Bulgarian economy in the second quarter are usually subject to corrections," said the professor, but the perception of the outspoken trend in the first half of this year changed.

He explained that long-term loans are riskier and that interest rates are in principle higher than those in the short term, but in June the average interest rate is around 5%, while the interest on short-term loans is 8.5%.

"This is a difference of 3.5 percentage points, which shows that the demand for short-term loans is longer than the long-term, it is categorical.

The economist advised creating conditions to increase investments.

"If we look at the structure of GDP, we will find good things: the investment grows by 4.4%, in the cost structure of the production this increase is largely due to the growth of consumption." In the future, I predict that data on economic growth will reach 4%, but this is a low percentage for Bulgaria given the distance that separates us from the EU, "he said.

According to him, inflation is already 3.5% and is likely to continue in the future, Minassin explained and recalled that one of the goals of the European Central Bank is to keep inflation around 2% in the eurozone, because such an inflation is stimulating on an annual basis. both consumption and production.

The professor advised inflation in Bulgaria to be higher than in the EU and calculated that it is acceptable within 3.5 – 4%, but noted that there are external factors influencing inflation.

The economist of the Bulgarian Academy of Sciences does not share the estimate of the lower prices of certain foods in Germany in Greece and said that "goods with a higher price than those of the neighboring countries will be found positive".

"But the average cost of living in the EU is twice as high as in our country," Minsantin adds. "And we all feel it when we try to maintain an acceptable standard of living abroad."

For the & # 39; Turkish history & # 39; in the current economic situation he believes that this is another sad story in the Balkans & # 39; is and he predicts that & # 39; no wonder after another year and another neighbor of us to lapse into such a situation & # 39 ;.

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