The European Commission recommended on Wednesday that Bulgaria take action to address several areas of macroeconomic imbalances in 2016 and 2017, the Sofia News Agency reported. The proposal is part of the Commission’s 2016 country-specific recommendations which set out its economic policy guidance for the EU Member States for the next 12 to 18 months. More specifically, the Commission recommended that Bulgaria achieve an annual fiscal adjustment of 0.5% of GDP towards the medium-term budgetary objective in 2016 and in 2017. The EU executive also said that Bulgaria needs to further improve tax collection and take measures to reduce the share of the informal economy, including undeclared work. With regard to the banking sector, the Commission said that by the end of 2016, Bulgaria needs to finalise the asset quality review and stress test of the country’s banks. Within the same timeframe Bulgaria needs to complete the balance-sheet review and stress test of the insurance companies and the review of private pension funds' assets. The Commission also recommended that Bulgaria continue to improve banking and non-banking supervision. Read more.