Bulharsko
A Balkan country with spectacular mountains and the Black Sea coastline. Strategic geographic location
Total area: 111, 000 sq km (roughly the size of Virginia)
Population: 6.8 million
Government type: Parliamentary democracy
Administrative division: 28 provinces
Capital + other major cities: Sofia (1.2 million) + Plovdiv (321,000), Varna (311,000), Burgas (188,000), Ruse (123,000)
Currency: lev (BGL)
Languages: Bulgarian 76.8% (official), Turkish 8.2%, Roma 3.8%, other 0.7%, undeclared 10.5%
Ethnicity: Bulgarian 76.9%, Turkish 8%, Romani 4.4%, other 0.7% (including Russian, Armenian, and Vlach), other (unknown) 10% (2011 est.)
Religion: Eastern Orthodox 59.4%, Muslim 7.8.%, other (including Catholic, Protestant, Armenian Apostolic Orthodox, and Jewish) 1.7%, none 3.7%, undeclared 27.4%
President: (Mr.) Ruden RADEV (since 22 January 2017)
Prime Minister: Prime Minister Nikolay DENKOV (since 6 June 2023)
Date of EU accession: 1 January 2007
KEY FEATURES
- Great potential of the tourism sector (coast of the Black Sea, mountains)
- High share of the agricultural sector and strong food industry – dairy, wine
- Biggest power exporter in the Balkan region
- EU’s least developed country
- Low labor costs, low corporate (10%) and income taxes (10%)
- The third least tax-burdened country in the EU
- A long fight against corruption still ahead
- Uses Cyrillic
- Member of the Schengen area since March 2024 (after 12 years of negotiations)
- Bulgarian currency has been firmly pegged to the EUR
MACROECONOMIC OVERVIEW
Bulgaria’s GDP per capita in PPP is still only slightly above half of the EU-27 average (64%), the lowest rate among all Member States. However, Bulgaria ranks 61st in the Ease of Doing Business rank list, higher than most other Eastern European states, and 31st in the Economic Freedom of the World index (2024), outperforming Belgium, Italy, Poland, France, or Hungary. It also introduced a set of tax laws aimed at supporting local businesses as well as attracting FDI. Bulgaria also has one of the lowest public debts in the EU.
Despite having the lowest GDP per capita in the EU, Bulgaria has good potential for further growth. It has undergone a significant transformation since the 1990s but still faces challenges in the form of institutional and governance weaknesses and negative demographic trends. In recent years, the economy has grown steadily above the EU average. After a contraction in 2020, the economy grew by 4.4% in 2021 with exports and consumption acting as the main drivers and maintained this pace in 2022. The decline in 2023 was mainly due to a drop in exports and deceleration in private consumption.
The Bulgarian currency firmly pegged to the EUR provides good stability and eliminates risk in the trade. Since mid-2020, the country participates in the European exchange rate mechanism, which is one of the initial steps to adopting the euro as the official currency. The country expects to join the Eurozone in 2025.
Selected economic indicators, Bulgaria, 2017 - 2023
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | ||
| GDP |
|
|
|
|
|
|
|
|
| Real GDP growth |
%
|
2.8
|
2.7
|
4.0
|
-4.0
|
7.7
|
3.9
|
1.8 (p)
|
| GDP at current prices |
€ bn
|
52.31
|
56.01
|
60.68
|
61.33
|
71.08
|
85.8
|
93.9
|
| Foreign trade |
|
|
|
|
|
|
|
|
| Exports |
€ bn
|
35.21
|
36.94
|
39.3
|
34.5
|
43.6
|
59.3
|
57.1 (p)
|
| Imports |
€ bn
|
32.94
|
35.49
|
36.50
|
33.03
|
42.3
|
59.1
|
54.2 (p)
|
| Balance |
€ bn
|
2.27
|
1.45
|
2.07
|
0.9
|
1.3
|
0.2
|
2.9 (p)
|
| Prices |
|
|
|
|
|
|
|
|
| CPI – average inflation rate |
%
|
1.2
|
2.6
|
2.5
|
1.2
|
2.8
|
13.0
|
8.6
|
| PPI – industry – average |
%
|
5.0
|
3.9
|
3.1
|
-1.2 |
14.8
|
48.5
|
-12.5
|
| Employment |
|
|
|
|
|
|
|
|
| Registered unemployment |
%
|
7.2
|
6.2
|
5.2
|
6.1
|
5.3
|
4.2
|
4.3
|
| Average monthly gross wage |
€
|
406
|
586
|
690
|
710
|
798
|
900
|
1,029
|
| Exchange rates* |
|
|
|
|
|
|
|
|
| USD/BGN average (BGN per USD) |
|
1.735
|
1.659
|
1.748
|
1.716
|
1.654
|
1.860
|
1.801
|
| Currency board fixed rate: EUR/BGN |
|
1.956
|
1.956
|
1.956 | 1.956 | 1.956 | 1.956 | 1.956 |
Source: Bulgarian National statistical institute, IMF, OECD, Eurostat, ECB, 2017-2023
* For the current exchange rate, please see www.xe.com
KEY SECTORS
The relative share of each economic sector in the GVA (Gross Value Added) is 69.5% in the services sector, 26.5% in industry, and 4% in agriculture. Tourism has seen a steady growth of 5-12% over the last 16 years (wellness & spa, historical tourism or ski resorts growing).
Metallurgy and Energy
The country has a strong metallurgical industry, which represents 20% of the country’s exports. Mining and its related industries employ a total of 120,000 people and generate about 5% of the country's GDP. Bulgaria is the third largest coal producer in the EU. Coal generates more than 36% of the country's electricity. Local deposits of coal, iron, copper, and lead are vital for the manufacturing and energy sectors. Extraction of metals and minerals, petroleum refining, and steel are among the major industrial activities. Almost all top export items of Bulgaria are industrial commodities such as oil products, copper products, and pharmaceuticals/chemicals. Bulgaria is also an important power producer and exporter in the region.
Manufacturing
Within the manufacturing sector, food processing is the major segment known especially for its dairy products and wine which is exported mostly to the EU (and before the war to Russia). Bulgaria is the largest global producer of perfume essential oils such as lavender and rose oil. Other important sub-sectors include textiles (close ties with European manufacturers and foreign companies), engineering (supplies of components to foreign OEMs), and electrical engineering/electronics (mainly automotive components). However, the production with low added value still prevails within the local industry. Interestingly, Bulgaria has become a major producer of bicycles, both classic and electric, and is sometimes referred to as Europe's "bicycle valley". The country is moving forward to become the largest producer of e-bikes in Europe.
ICT
Bulgaria has a growing IT sector known for software development, IT outsourcing, and business process outsourcing (BPO). Cities such as Sofia and Plovdiv have become hubs for tech companies, offering skilled IT professionals and competitive services. The IT sector has been growing annually on average by 20% since 2015.
Tourism
Among the service sectors, tourism is the most significant contributor to economic growth. In recent years, Bulgaria has emerged as a travelling destination with its inexpensive resorts and beaches outside the reach of the tourist industry. Most of the visitors are British, Romanians, Germans, and formerly also Russians. Sunny coasts and winter resorts Bansko, Pamporovo and Borovets are among the most visited tourist locations.
EXPORTS & IMPORTS
Exports make a strong contribution to GDP. Bulgaria is quite proactive in foreign trade, with an export/GDP ratio of 68.5% in 2022. The key exported commodities are electrical machinery, copper, mineral fuels including oil, cereals, vehicles, pharmaceuticals, articles of iron and steel, plastics and plastic articles, and clothing and accessories. Due to its geographical location and business relations based on historical development, its intra-trade with EU countries is at a lower level. Important import partners outside the EU are Russia (due to the high energy price increase in 2022) and Türkiye.
2023 export and import data:
Main import partners:
Germany – 12.4%
Türkiye – 8.2%
Romania – 6.8%
Italy – 6.7%
Russian Federation – 6.6%
Main export partners:
Germany – 13.7%
Romania – 9.2%
Italy – 7.2%
Türkiye – 5.8%
Greece – 5.5%
Other Europe, nes – 3.8%
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