A | B | C | D | E | F | G | H | CH | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9
From top to bottom, left to right: Business Park Sofia, Trakia Economic Zone, Tourism in Bulgaria, Bulgarian National Bank | |
| Currency | Bulgarian lev (BGN) |
|---|---|
| Calendar year | |
Trade organisations | EU, WTO and BSEC |
Country group |
|
| Statistics | |
| Population |  6,447,710 (2022)[4] |
| GDP | |
| GDP rank | |
GDP growth |
|
GDP per capita | |
GDP per capita rank | |
GDP by sector |
|
 8.5% (2023)[5] | |
Population below poverty line | |
| 37.2 medium (2023)[11] | |
| |
 45 out of 100 points (2023, 67th) | |
Labour force | |
Labour force by occupation |
|
| Unemployment | |
Average gross salary | BGN 2,300/ €1,175 / $1,278 monthly (March 2024) |
| BGN 1,784 / €913 / $991 monthly (March 2024) | |
Main industries | electricity; tourism; construction; non-ferrous metal mining industry; food, beverages, tobacco; machinery and equipment, automotive parts; chemical products, petroleum refinement (fuels); logistics and transportation; IT sector and outsourcing providers for specialized services. |
| External | |
| Exports | $55.3 billion (2022)[17] |
Export goods | refined petroleum, petroleum gas, electricity, refined and raw copper, wheat, seed oils, sunflower seeds, precious metal ore, prep binder for foundry, packaged medicaments, motocycles and cycles, automotive parts, copper plating, raw metals, scraps, electrical equipment, baked goods[18] |
Main export partners | |
| Imports | $56.5 billion (2022)[20] |
Import goods | crude petroleum, petroleum gas, copper ore, cars and automotive parts, tractors, prepr binder for foundry, packaged medicaments, refined petroleum, telephones, semiconductor devices and computers, sunflower seeds, seed oils, raw and refined metals, foods, clothes[21] |
Main import partners | |
FDI stock | |
| $2.562 billion (2017)[3] | |
Gross external debt | $42.06 billion (2017)[3] |
| Public finances | |
| Revenues | 37.9% of GDP (2023)[23] |
| Expenses | 39.8% of GDP (2023)[23] |
| Economic aid |
|
| |
| $28.38 billion (2017)[3] | |
All values, unless otherwise stated, are in US dollars. | |
The economy of Bulgaria functions on the principles of the free market, having a large private sector and a smaller public one. Bulgaria is an industrialised high-income country according to the World Bank,[28] and is a member of the European Union (EU), the World Trade Organization (WTO), the Organization for Security and Co-operation in Europe (OSCE) and the Organization of the Black Sea Economic Cooperation (BSEC). The Bulgarian economy has experienced significant growth (538%), starting from $13.15 billion (nominal, 2000)[29] and reaching estimated gross domestic product (GDP) of $86 billion (nominal, 2022 est.)[29] or $203 billion (PPP, 2022 est.), GDP per capita of $31,148 (PPP, 2022 est.),[30] average gross monthly salary of 2,009 leva (1,027 euro) (April 2023),[31] and average net monthly salary of $2,102 (adjusted for living costs in PPP) (2022).[32][circular reference] The national currency is the lev (plural leva), pegged to the euro at 1.95583 leva for 1 euro.[33] The lev is the strongest and most stable currency in Eastern Europe.[34][35]
The strongest sectors in the economy are energy, mining, metallurgy, machine building, agriculture and tourism. Primary industrial exports are clothing, iron and steel, machinery and refined fuels.[36]
Sofia is the capital and economic heart of Bulgaria and home to most major Bulgarian and international companies operating in the country, as well as the Bulgarian National Bank and the Bulgarian Stock Exchange. Plovdiv is the second-largest city and has one of the largest economies in Bulgaria. Varna is the third-largest city in Bulgaria and the largest city and seaside resort on the Bulgarian Black Sea Coast. Situated strategically in the Gulf of Varna, economically, Varna is among the best-performing and fastest-growing Bulgarian cities.
The Bulgarian economy has developed significantly in the last 26 years, despite all difficulties after the disband of Comecon in 1991. In the early 1990s, the country's slow pace of privatization, contradictory government tax and investment policies, and bureaucratic red tape kept the foreign direct investment (FDI) among the lowest in the region. Total FDI from 1991 through 1996 was $831 million.
In December 1996, Bulgaria joined the World Trade Organization. In the years since 1997, Bulgaria begun to attract substantial foreign investment. In 2004 alone, over 2.72 billion euro ($3.47 billion) were invested by foreign companies. In 2005, economists observed a slowdown to about 1.8 billion euro ($2.3 billion) in the FDI, which is attributed mainly to the end of the privatization of the major state-owned companies.
After joining the European Union in 2007, Bulgaria registered a peak in foreign investment of about 6 bln euro. Low productivity and competitiveness on the European and world markets alike due to inadequate R&D funding, however, still remain a significant obstacle for foreign investment.[37] Nevertheless, according to the latest Annual report of the Economic Research Institute at the Bulgarian Academy of Sciences, the average salary in Bulgaria is a quarter (1/4) of the average salary in the European Union, and should be two times higher when the labour productivity is calculated in the formula.[38]
During the Great Recession, Bulgaria saw its economy decline by 5.5% in 2009, but quickly restored positive growth levels to 0.2% in 2010, in contrast to other Balkan countries.[39] However, the growth continued to be weak in the following years, and GDP only reached pre-crisis levels in 2014.[40]
History
During the 17th and 18th century Bulgaria had a largely undeveloped industry with agriculture, crafts, and partly trade being the only developed industry sectors.
Bulgaria was one of the more dynamic industrial areas of the Ottoman Empire.[41] Bulgaria experienced an economic boom in export-oriented textiles in the period 1815–65, even while the Ottoman Empire's economy was declining.[41] Bulgaria had comparatively weak economic growth from the 1870s to World War I.[41][42] The Bulgarian export sector collapsed after Bulgarian independence in 1878.[41] By 1903, industrial output in Bulgaria was far lower than in 1870.[41]
During the 1930s, the Bulgarian economy was described as an economy militarily bound to Germany. In the early 1940s, as Germany began to lose the Second World War, the Bulgarian economy suffered a decline.[43][44][45]
In the interwar period, there was considerable economic modernization in Bulgaria's agricultural sector, setting the conditions for rapid growth after World War II.[42]
Cold War period
During the Socialism era, Bulgarian economy continued to be industrialized, although free market trade substantially decreased, as private market initiatives became state-regulated. Still, the Bulgarian economy made significant overall progress in modernizing road infrastructure, airline transportation, as well as developing the tourism sector by building tourist resorts along the Black Sea coast and the mountain regions.
From the end of World War II until the widespread change of regime in Eastern Europe in November 1989, the Bulgarian Communist Party (BCP) exerted complete economic, social and political control in Bulgaria. The party's ascent to power in 1944 had marked the beginning of economic change towards planned economy. During that time, Bulgaria followed the Soviet model of economic development more closely than any other member of the Eastern Bloc, while becoming one of the first members of Comecon. The new regime shifted the economy type from a predominantly agrarian one towards an industrial economy, while encouraging the relocation of the labour force from the countryside to the cities, thus providing workers for the newly built large-scale industrial complexes. At the same time, the focus of Bulgarian international trade shifted from Central Europe to Eastern Europe and the USSR.[46][47]
These new policies resulted in impressive initial rates of economic development.[46] Bulgarian economy closely resembled that of the Soviet Union. Soviet-style centralised planning formed by consecutive five-year plan periods had more immediate benefits there compared to the other Eastern European states where it was first applied in the early 1950s.[48] Throughout the postwar period, economic progress was also substantially assisted by a level of internal political stability unseen in other Eastern European countries during the same period. That represented a change on the Bulgarian political scene, as political turbulence was common before BCP's ascent to power.[46]
Nonetheless, beginning in the early 1960s, low capital and labour productivity, as well as expensive material inputs, plagued the Bulgarian economy. With disappointing rates of growth came a high degree of economic experimentation. This experimentation took place within the socialist economic framework, although never approaching a market-based economy.[46]
In the late 1980s, continuing poor economic performance intensified economic hardship. By that time, the misdirection and irrationality of BCP economic policies had become quite clear.[46] Bulgaria's economy contracted dramatically after 1987, shortly before Comecon, with which the Bulgarian economy had integrated closely, dissolved in 1991. On 10 November 1989, at the November plenum of BCP, Todor Zhivkov was dismissed from his long-held party leader and head of state positions. The communist regime gave way to democratic elections and government. Unlike the communist parties in most other Eastern European states, the BCP (changing its name to Bulgarian Socialist Party) retained power by winning the first free national elections in June 1990. That was made possible by changes in party leadership, programme, reduction of its power base and other moves which permitted economic re-orientation toward a market system. This difficult transition combined with political vagueness and unpreparedness of the Bulgarian people for social and economic changes led to dramatically worsening economic conditions during the early 1990s.[46]
1990–2000
Economic performance declined dramatically at the beginning of the 1990s after the disbandment of the Comecon system and the loss of the Soviet and Comecon market, to which the country had been entirely tied. Also, as a result of political unrest with the first attempts to re-establish a democratic political system and free market economy the standard of living fell by about 40%, and only started to stabilize significantly after 1998 after the fall of Jean Videnov's socialist government. It regained pre-1989 levels by June 2004.
First signs of recovery showed in 1994 when GDP grew by 1.4%. This progress continued with a 2.5% rise in 1995. Inflation, which surged to 122% in 1994, fell to normal rates of 32.9% in 1995. During 1996, however, the economy collapsed during Jean Videnov's government. That was due to the Bulgarian Socialist Party's inability to introduce vital economic reforms and failure to set legislative standards for banking and financial institutions, thus forcing an unstable banking system. All this led to an inflation rate of 311%, and the collapse of the lev. In the spring 1997, the pro-reform United Democratic Forces coalition came to power with its ambitious economic reform package. The reforms included introduction of a currency board regime, which was agreed to with the International Monetary Fund and the World Bank, and allowed the economy to stabilize. The 2000s saw a steady pace of growth and budget surpluses, but shaky inflation.
Successful foreign direct investment and successive governments have demonstrated a commitment to economic reforms and responsible fiscal planning that have contributed greatly to the Bulgarian economy, with a historical growth rate average of 6% a year. Corruption in the public administration and a weak judiciary have continued to be long-term problems, with presence of organized crime remaining very high.[49]
Although politicians were giving warranties that the late-2000s recession would not hit Bulgaria, the economy suffered a 5.5% GDP decline in that period. Unemployment rose for at least five-quarters bringing Bulgaria's worst recession since the early 1990s. Still, economic circumstances were not too severe when compared to the rest of Europe. Future prospects are tied to the country's increasingly important integration with the European Union member states.
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 Yugoslavia and 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.
Rebound from the February 1997 crisis
In April 1997, the Union of Democratic Forces (SDS) won pre-term parliamentary elections and introduced an IMF currency board system which succeeded in stabilizing the economy. The triple digit inflation of 1996 and 1997 has given way to an official economic growth, but forecasters predicted accelerated growth over the next several years. The government's structural reform program includes:
- privatization and, where appropriate, liquidation of state-owned enterprises (SOEs);
- liberalization of agricultural policies, including creating conditions for the development of a land market;
- reform of the country's social insurance programs; and
- reforms to strengthen contract enforcement and fight crime and corruption.
Despite reforms, weak control over privatization led many successful state enterprises to bankruptcy. The SDS government also failed to stop the growing negative account balance, which has since then continued to increase, reaching a negative of $12.65 billion in 2008.[50] The government elected in 2001 pledged to maintain the fundamental economic policy objectives adopted by its predecessor in 1997, specifically: retaining the Currency Board, implementing sound financial policies, accelerating privatisation, and pursuing structural reforms. Both governments failed to implement sound social policies.
The economy really took off between 2003 and 2008 and growth figures quickly shot up, fluctuating between figures as high as 6.6% (2004) and 5.0% (2003). Even in the last pre-crisis year, 2008, the Bulgarian economy was growing rapidly at 6.0%, despite significantly slowing down in the last quarter.[51]
Part of the European Union
On 1 January 2007, Bulgaria entered the European Union. This led to some immediate international trade liberalization, but there was no shock to the economy. The government ran annual surpluses of above 3%.[when?] This fact, together with annual GDP growth of above 5%, has brought the government indebtedness to 22.8% of GDP in 2006 from 67.3% five years earlier.[52] This is to be contrasted with enormous current account deficits. Low interest rates guaranteed availability of funds for investment and consumption. For example, a boom in the real estate market started around 2003. At the same time annual inflation in the economy was variable and during the last five years (2003–2007) has seen a low of 2.3% and high of 7.3%.[53] Most importantly, this poses a threat to the country's accession to the Eurozone. The Bulgarian government originally planned to adopt the Euro no sooner than 2015. Although Bulgaria will have to adopt the euro as a condition to membership, plans have since been postponed for better economic times. From a political point of view, there is a trade-off between Bulgaria's economic growth and the stability required for early accession to the monetary union. Bulgaria's per-capita PPP GDP is about 60% of the EU27 average (2021), while the country's nominal GDP per capita is about 35% of the EU27 average (2021). However, Bulgaria ranks 38th (2015) in the Ease of Doing Business rank list, higher than most other Eastern European states,[54] and 40th (2012) in the Economic Freedom of the World index, outperforming Belgium, Spain, Poland, Hungary, Portugal. Bulgaria also has the lowest personal and corporate income tax rates in the EU,[55][56][57] as well as the second lowest public debt of all European Union member states at 16.2% of GDP in 2010.[58]
Financial crisis of 2007–2008
The country suffered a difficult start to 2009, after gas supplies were cut in the Russia-Ukraine gas dispute. Industrial output suffered, as well as public services, exposing Bulgaria's overdependence on Russian raw materials. The financial crisis of 2007–2008 applied downward pressure on growth and employment by the last quarter of 2008. The real estate market, although not plummeting, ground to a halt and growth was significantly lower in the short-to-medium run.
During 2009, the grim forecasts for the effects of the Great Recession on the Bulgarian economy largely materialized. Although suffering less than the worst-hit countries, Bulgaria recorded its worst economic results since the 1997 meltdown. GDP shrank by around 5% and unemployment jumped. Consumer spending and foreign investment dropped dramatically and depressed growth in 2010 to 0.3%. Unemployment remains consistently high at around 10%.
New government and fiscal discipline
The government of Boyko Borisov elected in 2009 undertook steps to restore economic growth, while attempting to maintain a strict financial policy.[59] The fiscal discipline set by Finance Minister Djankov proved successful and together with reduced budget spending it placed Bulgarian economy on the stage of steadily though slowly growing in the midst of world crisis. On 1 December 2009, Standard & Poor's upgraded Bulgaria's investment outlook from "negative" to "stable," which made Bulgaria the only country in the European Union to receive a positive upgrade that year.[60] In January 2010 Moody's followed with an upgrade of its rating perspective from "stable" to "positive."
Bulgaria was expected to join the Eurozone in 2013 but after the rise of some instability in the zone Bulgaria is withholding its positions towards the Euro, combining positive and realistic attitudes.[61][62] The 2012 Transatlantic Trends poll found that 72 percent of Bulgarians did not approve of the economic policy pursued by the government of the (then) ruling center-right GERB party and Prime Minister Boyko Borisov.[63] In 2024 Bulgaria is making final preparations to adopt the Euro and depending on the inflation rate during the year, the country has a chance of joining the Eurozone in 2025.[64]
Economic statistics
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Data
Data
The following table shows the main economic indicators in 1980–2018.[65]
| Year | GDP (in Bil. US$ PPP) |
GDP per capita (in US$ PPP) |
GDP
(in Bil. US$ nominal) |
GDP growth (real) |
Inflation rate (in Percent) |
Unemployment (in Percent) |
Budget balance (in % of GDP) |
Government debt (in % of GDP) |
|---|---|---|---|---|---|---|---|---|
| 1980 | 39.6 | 4,497 | 37.8 | 5.87% | n/a | n/a | n/a | n/a |
| 1981 | 45.7
|
5,168
|
40.7
|
5.3%
|
 0%
|
n/a | n/a | n/a |
| 1982 | 50.5
|
5,701
|
42.5
|
4.2%
|
 2.8%
|
n/a | n/a | n/a |
| 1983 | 54.1
|
6,087
|
43.6
|
3.0%
|
2.8%
|
n/a | n/a | n/a |
| 1984 | 58.6
|
6,585
|
46.4
|
4.6%
|
2.8%
|
n/a | n/a | n/a |
| 1985 | 61.5
|
6,911
|
39.7
|
1.8%
|
2.8%
|
n/a | n/a | n/a |
| 1986 | 66.1
|
7,426
|
35.1
|
5.3%
|
2.7%
|
n/a | n/a | n/a |
| 1987 | 70.9
|
7,978
|
40.7
|
4.7%
|
2.7%
|
n/a | n/a | n/a |
| 1988 | 75.2
|
8,480
|
66.5
|
2.4%
|
2.5%
|
n/a | n/a | n/a |
| 1989 | 77.7
|
8,807
|
67.8
|
0.5%
|
6.4%
|
0.0%
|
n/a | n/a |
| 1990 | 73.3
|
8,358
|
29.9
|
9.1%
|
23.9%
|
2.9%
|
n/a | n/a |
| 1991 | 67.6
|
7,777
|
2.9
|
10.8%
|
335.5%
|
6.8%
|
n/a | n/a |
| 1992 | 63.3
|
7,360
|
11.9
|
8.4%
|
82.0%
|
13.2%
|
n/a | n/a |
| 1993 | 57.3
|
6,736
|
6.4
|
11.6%
|
72.8%
|
15.8%
|
n/a | n/a |
| 1994 | 56.4
|
6,707
|
11.3
|
3.7%
|
96.0%
|
14.1%
|
n/a | n/a |
| 1995 | 56.6
|
6,511
|
19.0
|
1.6%
|
62.1%
|
11.4%
|
n/a | n/a |
| 1996 | Zdroj:https://en.wikipedia.org?pojem=Statistics_about_the_economy_of_Bulgaria