BULGARIA'S FOREIGN TRADE AND ITS INFLUENCE ON ECONOMIC GROWTH

Abstract

There is also a growing body of literature on the relationship between foreign trade and economic growth, but many of these studies need to include the import variable. This study examines the state of trade in goods between Bulgaria and the world for 2018-2022 and investigates the cointegration between both export/import and economic growth of Bulgaria through employing yearly data for 1990 -2022. The Engle-Granger's cointegrating test was used to study the long-term relationship between variables. The results show a positive and significant long-term relationship between Bulgarian exports and imports and gross domestic product at a 99% confidence level. This leads us to two conclusions: first, Bulgarian exports are more variable over time than Bulgarian imports, and second, the development of Bulgarian foreign trade will positively affect its economic growth.

Keywords

• foreign trade
• economic growth
• cointegration analysis
• bulgaria jel classification: f14; f43
• o47