Editing Economy of Bulgaria (section)

===Reforms of the 1990s and early 2000s===
Members of the government promised to move forward on cash and mass [[privatization]] upon taking office in January 1995 but were slow to act. United Nations sanctions against [[Federal Republic of Yugoslavia|Yugoslavia]] and [[Iraq sanctions|Iraq]] (1990–2003), two of the country's most significant trading partners, took a heavy toll on the Bulgarian economy. The first signs of recovery emerged in 1994 when the GDP grew and inflation fell. The first round of mass privatisation finally began in January 1996, and auctions began toward the end of that year. The second and third rounds were conducted in Spring 1997 under a new government. In July 1998, the UDF-led government and the IMF reached an agreement on a 3-year loan worth about $800 million, which replaced the 14-month stand-by agreement that expired in June 1998. The loan was used to develop financial markets, improve [[social safety net]] programmes, strengthen the tax system, reform agricultural and energy sectors, and further liberalise trade. The [[European Commission]], in its 2002 country report, recognised Bulgaria as a functioning market economy, acknowledging the progress made by Prime Minister [[Ivan Kostov]]'s government toward market-oriented reforms.