Options:
A. suffered from foreign investment
B. went into steep decline
C. experienced the multiplier effect
D. enjoyed dramatic growth
Answer:
B. went into steep decline
Explanation:
Bulgaria's economy contracted after 1989, with the decline of the Soviet Union and, consequently, diminishing access to the Soviet market. During the Cold War, the Bulgarian economy became very dependent on the USSR. The standard of living of Bulgarians fell by 40% from pre-1990 levels, only returning to its former level in June 2004.
The process of transition to a free market economy began following the fall of the communist regime in 1989. In this context, the process began in Bulgaria under particularly unfavorable conditions, due to the poor economic planning of previous decades and the legacy of a sector and ineffective industrial sector as well as systematic neglect of the agricultural sector (currently holding 11% of GDP).
Agriculture has become an important sector of the Bulgarian economy. After the 1996 financial crisis, agriculture was the only sector that grew. This improvement is due to the recovery of low agricultural production up to 1996, estimated at 30%. Agriculture is also a major source of employment in Bulgaria: 23% of the working population works in the agricultural sector. The food processing industry is second in importance, having already accounted for about 21% of total industrial production.
