Economic and Political Overview

flag Bulgaria Bulgaria: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

Since the beginning of the century, Bulgarian authorities have maintained macroeconomic stability, supported by a currency board arrangement and prudent fiscal policies. This has enabled the country to navigate recent crises effectively while staying on a steady path of income convergence. After the energy price shock in 2022 and weak external demand in 2023, Bulgaria's economy grew at a faster pace in 2024, reaching 2.3% compared to 1.8% the previous year, driven by both domestic and foreign demand, along with an expansionary fiscal stance. Growth is projected to rise to 2.5% in 2025 before easing to 2.8% in 2026 (IMF). The deployment of unlocked EU funds is expected to boost both public and private investment, which was restrained in 2024. Low unemployment and strong real income growth will continue to drive household consumption, while export growth is anticipated to recover alongside external markets. Inflation is likely to remain near current levels, though a further minimum wage increase in 2025 and ongoing labour shortages will sustain wage pressures.

Bulgaria’s general government deficit rose to 3% of GDP in 2024 (from 2% in 2023) due to higher public pensions and salaries approved in 2022, outweighing revenue gains from social security contributions and direct taxes. Measures to boost revenue included tighter control of high-risk goods and maintaining a 100% dividend on state-owned enterprises. According to the EU Commission, in 2025, the deficit is expected to edge up to 2.8% of GDP as pension and salary spending continues to rise, though at a slower pace. Public investment is set to increase, driven by RRP implementation and military spending accruals. Social security contributions should grow in line with wages, while corporate tax revenue is expected to decline. The deficit is projected to remain at 2.8% of GDP in 2026. The debt to GDP ratio – at 23.7% in 2024 – is set to increase marginally to 27.1% by 2026, still very low compared with EU countries. After decelerating steadily over 2023, Bulgaria's average annual inflation in 2024 was 2.4%, according to NSI data. In 2025, inflation is expected to ease to 2.3%, driven by negative energy inflation, low industrial goods inflation, and base effects from 2024's tourist service price hikes. According to the 2024 Convergence Report, Bulgaria met all euro-adoption nominal criteria except for price stability. The country is expected to adopt the euro by 2026.

Unemployment remained low in 2024, with manufacturing job losses offset by public sector and services hiring. Employment grew alongside higher participation rates, while wage growth accelerated due to labour market tightness and a 19.6% minimum wage hike in January. With a shrinking unemployed population, employment is expected to remain stable. The country officially attained high-income status on July 1, 2024, with a GDP per capita (PPP) estimated at USD 39,185 in 2024 by the IMF, still below the EU average. Income inequality in Bulgaria is among the highest in the EU, and almost 30% of the population is at risk of poverty (the second-highest rate in the EU after Romania).

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 101.61108.43115.53121.86128.06
GDP (Constant Prices, Annual % Change) 1.82.32.52.82.7
GDP per Capita (USD) 15,76517,06918,45619,62320,789
General Government Balance (in % of GDP) -3.3-2.9-3.0-2.5-3.2
General Government Gross Debt (in % of GDP) 22.023.725.427.129.0
Inflation Rate (%) 8.62.82.61.92.0
Unemployment Rate (% of the Labour Force) 4.44.34.24.14.0
Current Account (billions USD) -0.27-1.04-1.92-1.25-1.59
Current Account (in % of GDP) -0.3-1.0-1.7-1.0-1.2

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

Traditionally an agricultural country, Bulgaria is now considerably industrialized. In fact, the agricultural sector only accounts for 2.5% of GDP and employs 5.7% of the workforce (World Bank, latest data available). The main crops are sunflower, tobacco, and wheat. Around 41% of the country’s territory is considered agricultural land. The total number of agricultural holdings is 132,742, while the total number of registered farmers in 2021 was 76,372 (EU Commission, latest data available). According to preliminary NSI data, in 2024, the agricultural industry's final output at basic prices totalled BGN 9,440.6 million. The gross value added at basic prices fell by 9.9% compared to the previous year, amounting to BGN 3,798.9 million, while the net entrepreneurial income was BGN 889.1 million.

The industry represents 22.7% of the GDP, and 29.6% of the workforce is employed in the sector. It continues to rely heavily on the manufacturing sub-sectors (metallurgical, chemical, machine-building), which are estimated to contribute to 14% of GDP (World Bank). The manufacturing and mining sectors play a crucial role in Bulgaria’s economy, making significant contributions to industrial production and employment. However, these sectors are currently facing challenges such as high energy consumption, outdated equipment to some extent, and a heavy dependence on fossil fuels. The most dynamic sectors are textile, pharmaceutical products, cosmetic products, mobile communication, and the software industry. Bulgaria's main mineral resources include bauxite, copper, lead, zinc, coal, lignite (brown coal), and iron ore.

The tertiary sector has more than doubled its contribution to the country’s economy since the end of the communist system, accounting for 62.5% of GDP and employing around 64.7% of the workforce. Tourism is one of the fastest-growing sectors: it was estimated to contribute 3.1% of GDP before the pandemic. The sector showed signs of recovery in 2024, when Bulgaria welcomed 13.24 million tourists, 4.9% more than the previous year, surpassing the level recorded in 2019. According to the latest figures from the European Banking Federation, 23 banks are currently operating in Bulgaria, six of which are foreign bank branches. The top five banks hold approximately 76.8% of all assets. In 2023 the banks’ total assets increased by 10.7% year-over-year to EUR 87.98 billion.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 5.7 29.6 64.7
Value Added (in % of GDP) 2.5 22.7 62.5
Value Added (Annual % Change) -15.3 -4.1 4.6

Source: World Bank - Latest available data.

 

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Monetary Indicators 20162017201820192020
Bulgarian Lev (BGN) - Average Annual Exchange Rate For 1 MUR 0.050.050.050.050.04

Source: World Bank - Latest available data.

 
 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
70,4/100
World Rank:
35
Regional Rank:
20

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
6.49/10
World Rank:
45/82

Source: The Economist Intelligence Unit - Business Environment Rankings 2020-2024

 

Country Risk

See the country risk analysis provided by Coface.

 

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Foreign Trade in Figures

Since joining the European Union, Bulgaria has experienced considerable growth in trade, despite a large trade imbalance and recurring deficits. The country is very open to foreign trade, which represents 120% of its GDP (World Bank, latest data available). Bulgaria mainly exports petroleum oils and oils obtained from bituminous (5.6%), wheat and meslin (3.5%), copper, refined, and copper alloys, unwrought (3.4%), medicaments consisting of mixed or unmixed (2.6%), and copper, unrefined; copper anodes for electrolytic (2%); while imports are led by petroleum oils (5.9%), copper ores and concentrates (3.6%), motor cars and other motor vehicles principally (3.3%), medicaments consisting of mixed or unmixed (3.1%), and petroleum gas and other gaseous hydrocarbons (1.9% - data Comtrade for 2023).

Bulgaria’s main export destinations in 2023 were Germany (13.6%), Romania (9.2%), Italy (7.2%), Turkey (5.8%), and Greece (5.5%); whereas imports came chiefly from Germany (12.4%), Turkey (8.2%), Romania (6.9%), the Russian Federation (6.7%), Italy (6.7%), and China (5.4%). Overall, the EU accounted for 63.5% and 59.9% of total exports and imports, respectively (data INS).

According to the latest figures from WTO, in 2023 exports of goods decreased by 4.1%, at USD 47.8 billion, with imports contracting at a faster pace (-7.1%), totalling USD 53.5 billion. The country is a net service exporter: it exported USD 15 billion worth of services, importing only USD 7.8 billion in 2023. The World Bank estimated the country’s trade balance to be positive by 4.1% of GDP in the same year. Preliminary data by the National Statistical Institute show that Bulgaria's balance on goods in 2024 was in negative territory, at EUR -5,470.5 million (5.3% of GDP), compared with a deficit of EUR -3,927.1 million (4.1% of GDP) in 2023, according to the Bulgarian National Bank. Exports of goods in 2024 totalled EUR 42,434.4 million (41.5% of GDP), dropping by 2.5% year-on-year. Imports of goods in 2024 totalled EUR 47,904.9 million (46.8% of GDP), growing by 0.9%.

 
Foreign Trade Indicators 20192020202120222023
Imports of Goods (million USD) 37,66335,05646,21057,95953,551
Exports of Goods (million USD) 33,34031,95441,15749,92547,854
Imports of Services (million USD) 5,9814,7765,9517,3177,871
Exports of Services (million USD) 11,4608,37610,89912,77815,043
Imports of Goods and Services (Annual % Change) 5.4-4.210.715.3-5.5
Exports of Goods and Services (Annual % Change) 4.0-9.611.612.10.0
Imports of Goods and Services (in % of GDP) 60.853.959.368.957.8
Exports of Goods and Services (in % of GDP) 64.256.461.870.061.9
Trade Balance (million USD) -3,256-2,256-3,379-5,308-4,243
Trade Balance (Including Service) (million USD) 2,2811,7482,1269854,220
Foreign Trade (in % of GDP) 125.0110.3121.2138.8119.7

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2023
Germany 13.7%
Romania 9.2%
Italy 7.2%
Türkiye 5.8%
Greece 5.5%
See More Countries 58.7%
Main Suppliers
(% of Imports)
2023
Germany 12.4%
Türkiye 8.2%
Romania 6.8%
Italy 6.7%
Russia 6.6%
See More Countries 59.3%

Source: Comtrade, Latest Available Data

 
 

Main Products

47.9 bn USD of products exported in 2023
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 5.6%
Wheat and meslinWheat and meslin 3.5%
Copper, refined, and copper alloys, unwrought ...Copper, refined, and copper alloys, unwrought (excl. copper alloys of heading 7405) 3.4%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 2.6%
Copper, unrefined; copper anodes for electrolytic...Copper, unrefined; copper anodes for electrolytic refining 2.0%
See More Products 83.0%
53.5 bn USD of products imported in 2023
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 5.9%
Copper ores and concentratesCopper ores and concentrates 3.6%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 3.3%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 3.1%
Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons 1.9%
See More Products 82.2%

Source: Comtrade, Latest Available Data

 
 

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Main Services

Source: United Nations Statistics Division, Latest Available Data

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Sources of General Economic Information

Ministries
Ministry of Economy and Industry
Ministry of Finance
Statistical Office
National Statistical Institute
Central Bank
Bulgarian National Bank
Stock Exchange
Bulgarian Stock Exchange
Search Engines
Servers
Dir
Gyuvetch.bg
Search.bg
Economic Portals
Bulgaria business portal

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Political Outline

Current Political Leaders
President: Bajram BEGAJ (since 24 July 2022)
Prime Minister: Edi RAMA (since 10 September 2013)
Next Election Dates
Presidential: 2027
Parliamentary: April 2026
Main Political Parties
Bulgaria has a multi-party system, where no single party generally has a chance of gaining power alone. Thus political parties work with each other to form coalition governments. The major political parties are:

- Citizens for European Development of Bulgaria (GERB): centre-right, it receives most of its support from nationalists and socialists. Leading a coalition government with SDS
- Union of Democratic Forces (SDS): centre-right, conservative
- BSP – United Left (BSP): centre-left, socialist, draws its support from rural areas. Electoral alliance in Bulgaria led by the Bulgarian Socialist Party
- We Continue the Change (PP): centre, liberalism, pro-European, in an electoral coalition with DB
- Democratic Bulgaria (DB): centre-right, pro-European
- Revival: far-right, ultranationalist
- Alliance for Rights and Freedoms (APS): centre, split for DPS
- Movement for Rights & Freedoms (DPS): centrist, liberal, formed mainly by the Turkish ethnic minority
- Morality, Unity, Honour (MECh): anti-establishment and anti-corruption platform
- Velichie: far-right.
Type of State
Republic state based on parliamentary democracy working under a pluriform multi-party political system.
Executive Power
The President is the chief of state and is directly elected for a 5-year term, renewable once, as is the Vice President. The President is the commander-in-chief of the armed forces and nominates the Prime Minister, who is elected by the National Assembly. The Prime Minister, as Chairman of the Council of Ministers, holds executive powers and is the head of government. The Prime Minister nominates the members of the Council of Ministers. The Council of Ministers is the principal body of the executive branch. If the National Assembly passes a vote of no confidence, the Council of Ministers must resign.
Legislative Power
Bulgaria has a unicameral parliament (called the National Assembly), consisting of 240 members who are elected for 4-year terms by proportional representation. A political party or coalition must obtain at least 4% of the vote in order to enter the National Assembly. The parliament is responsible for the enactment of laws, approval of the budget, scheduling of presidential elections, selection and dismissal of the Prime Minister and other ministers, declaration of war, deployment of troops outside of Bulgaria, and ratification of international treaties and agreements.
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
112/180
Evolution:
111/180
 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Free
Political Freedom:
2/7
Civil Liberties:
46/60

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

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Latest Update: May 2025