By Anna Mudeva
SOFIA, Jan 20 (Reuters) - Bulgaria's economy is suffering catastrophic damage from the cut-off in Russian gas supplies, with the impact resembling the aftermath of a terrorist attack, Economy and Energy Minister Petar Dimitrov told Reuters.
Dimitrov declined to predict yet how much economic growth would be hit in the first quarter, but said the nation faced a loss of jobs, incomes, markets and social stability.
"The impacts on the Bulgarian economy are catastrophic," Dimitrov said in an interview conducted on Monday. "These impacts have come on top of the ongoing economic crisis and turned into a dramatic result for Bulgaria."
The Balkan country, which is almost entirely dependent on Russian energy, is one of the worst hit in a prices dispute between Moscow and Kiev which has cut all Russian gas supplies via Ukraine to the rest of Europe for two weeks.
At least 250 big Bulgarian industrial companies, whose gas supplies have been suspended or rationed since Jan. 6, had reported so far direct losses of 170 million levs ($113 million), said Dimitrov. They also faced greater damage from a potential loss of export markets.
Bulgaria's emerging economy was already losing steam as its main exports market, the EU, faces a deep recession.
"(This) is why we kept saying that gas supplies should be resumed immediately because every day brings huge losses," Dimitrov said. "Loss of jobs, loss of markets, loss of incomes, loss of social stability ... That is why the impact very much resembles that of a terrorist attack."
Bulgaria has no access to alternative gas pipeline routes and has been forced to ration supplies to nearly 400 big industrial consumers due to limited domestic reserves.
Russian gas started flowing into Ukraine on the way to the rest of Europe earlier on Tuesday following the signing of a 10-year gas contract between Moscow and Kiev.
But the rationing in Bulgaria will stay in force at least until the end of the week as it will take time for the gas to reach the country and for technical preparations to be made.
Dozens of companies, including fertiliser, chemical and metals producers, have been forced to shut down and hundreds had to reduce production sharply.
Asked whether about the economic impact in the first quarter, Dimitrov said: "Growth is certainly bound to slow down but I can't make an exact forecast now because we need to assess the impact and the losses."
Economists have said that before the gas crisis growth was already likely to slow to below 2-3 percent this year from over 6 percent in the past few years as domestic consumption, hit by tighter lending conditions, had started to drop.
The European Commission on Monday revised down sharply its growth outlook for the bloc's east European newcomers but said Poland, the Czech Republic, Bulgaria and Romania would escape recession. It put Bulgarian growth at 1.8 percent this year.