Bulgaria and Romania, where the crisis hit later than elsewhere, are set to see the biggest improvements in growth in 2011 and 2012 among European Union newcomers, according to a World Bank report.

Two and a half years after the global financial crisis broke, the economic activity in the EU10 rebounded in parallel with the EU15, according to the World Bank's new EU10 Regular Economic Report.

Growth strengthened in the second half of 2010, supported by restocking, a double-digit expansion of industry, and a rebound in consumption, states the report.

The pace of recovery among EU10 countries will strengthen in 2011 and 2012, but it will be different in each of the 10 states, namely Bulgaria, the Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Romania, Slovakia and Slovenia.

"Romania is expected to lead the recovery in 2012 compared to the other EU10 countries, with a projected GDP growth of 4.4," said Cătălin Păuna, Senior Economistand co-author of the report.

As to Bulgaria, the World Bank expects an improvement in GDP growth from 0.2% in 2010 to 2.5% in 2011 and 3.4% in 2012.

The performance of Slovakia and Poland is set to remain solid thanks to low pre-crisis imbalances, deep integration into European production networks, EU funds, and, in the case of Poland, solid consumption.

Estonia, Lithuania, and Latvia are likely to build on the export-led upswing as domestic demand continues to recover.

Growth in Slovenia, the Czech Republic, and Hungary is set to increase at a more measured pace, in part because these countries have already converged more to EU income levels.

"The strong rebound in global trade benefited exports in the EU10, which recovered to pre-crisis levels by the end of 2010," said Kaspar Richter, Senior Economist in the World Bank's Europe and Central Asia Region and lead author of the report.

The report warns that EU10 growth prospects remain subject to risks, related to the feeble private investments, winding down of construction projects, and tight international financial constraints.

By the end of 2010, only exports had recovered to pre-crisis levels, benefiting from the strong rebound in global trade.

In addition, the EU10 recovery is still jobless.