Price blow for the Bulgarians — what next?

From 1 April, and not in jest, in Bulgaria, the price of natural gas will grow by almost 30%. This record increase is determined not by Bulgaria, and Russian supplier Gazprom, which covers 90% of the country’s needs in natural gas. We will not dwell on the reasons put forward by the Russian company for such a serious price increase. Here we look at the Bulgarian reaction and consequences for firms and citizens.

Natural gas in Bulgaria is used primarily in industry and household gasification is still at an early stage of development and gas is still relatively rarely used at the household level. For ordinary citizens, however, the movement in gas prices sensitive because of their reflection on the tariffs for heating, electricity and many products of daily use, which is used for production of natural gas. And the growth of prices for any such products or services are inevitable, because the cost of gas affects directly their price. We are talking about commodities such as bread, milk, meat, fruits and vegetables.

Especially not clearly, whether will increase of the Bulgarian producers and traders within days the prices of their products or will wait a bit to see how the situation will develop. It is clear, however, that the price increase will be, and it may not like the Bulgarian consumers, which a few years lost the habit of raising prices because of persistent deflation in the country.

As people will meet the expected growth of prices along the chain is still impossible to say. In any case, however, the plight of ordinary citizens and, especially, the elderly with their miserable pensions will worsen and force people to save. A reduction in consumption is a direct threat to GDP growth, which is still moving mainly in connection with consumption growth.

Such pessimistic estimates, should add another increase in prices for basic goods rise in prices of drinking water, while only two million inhabitants of Sofia, which today stands at 18%.

This series of price increases can not cause a social reaction to political elements. Popular discontent will complement the political instability at the top of government, which will be observed in Bulgaria in the following months after the parliamentary election revealed no clear winner, which be able to lead the country. Waltz of prices and the inevitable backroom deals that will not Bode well to the Bulgarians, and so tightly drawn belt.