The Confederation of Employers and Industrialists in Bulgaria (KRIB) calls on the caretaker government to implement “as a matter of priority and without delay“ the decision of the National Assembly, which obliged the executive branch to take measures against the price shock from high oil and natural gas prices.
Among the policies envisaged are the creation of a special fund at the Ministry of Finance, to be filled with the reciprocally increased VAT revenues due to the increased fuel prices, as well as the issuance of state guarantees for the rescheduling of lease payments, which the employers' organization defines as “reasonable and in the right direction“ to contain the inflationary shock at its root – transport industry.
If the support program is delayed, it is possible that the price shock will spill over from transport to consumer goods with significant damage to the economy and consumer peace of mind“, the position of KRIB reads.
The Union of International Carriers has already drawn attention to the fact that transport companies are reducing rates, as their costs have increased by 35%, which is particularly difficult for small transport companies and even with a decrease in profit margins, a significant part of it will be transferred to the end consumer.
From KRIB, we draw attention to the fact that the conflict in Iran has the potential to reduce global economic growth by about 0.3% and increase global inflation by 0.5 to 0.6%, according to calculations by various financial institutions and investment banks“, the position also reads.
And they draw attention to the fact that unlike the inflation crisis in 2021 – 2022, no significant disruption of supply chains for consumer goods is now expected. But on the other hand, the risk is concentrated in the energy sector, which is the basis of logistics and industrial production.
In the European Union, different levels of inflation are observed in different countries, with Bulgaria in the group of economies with higher price growth, which increases the risk of both an additional shock to consumers and the worst-case scenario of stagflation observed in Romania.
We call on the caretaker government to act decisively, also taking into account the sensitivity of Bulgarians to price changes in the immediate period after our entry into the eurozone. As we have previously warned, all inflationary shocks will open up the possibility of speculation and hybrid attacks that would undermine confidence in the euro and attribute the increase in inflation to it. This is already a significant risk for Bulgaria's geopolitical orientation," concludes the position of the CRIB.
Source: economic.bg