Fiscal Consolidation and Growth Effects of the EU Funding During 2021-2027 in Central and Eastern Europe
Fiscal Consolidation and Growth Effects of the EU Funding During 2021-2027 in Central and Eastern Europe

Summary/Abstract: The study examines fiscal consolidation and growth effects of the EU funding for the program period 2021-2027 in Bulgaria and other EU Member States from Central and Eastern Europe (CEE). It illustrates that gradual fiscal consolidation is implemented, but might be a challenge for some CEE countries, while the growth effects of the EU funding for 2012-2027 will depend on the level of substitution between EU and domestic funding of the EU-related projects. As a result, under the partnership agreements for 2021-2027 and the national recovery and resilience plans the CEE countries are expected to reduce gradually fiscal deficit and debt towards Maastricht criteria, and to increase their annual GDP growth above the baseline scenario between 1% and 4% of GDP, reaching cumulative growth from 9 to 24% of GDP by 2027.

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