Economy & Business Climate

• Five year average GDP growth of 4.9%;
• Budget surplus, low inflation, currency peg to EUR;
• 80% private economy;
• EU member, NATO member;
• Investment grade rating BBB by S&P and Fitch;
• Foreign direct investment at 11.7% of GDP (EUR 2.3 bn in 2004);
• The stock market has tripled in the last two years;

Bulgaria is now recognized as having a functioning market economy. But Bulgaria’s business environment still doesn’t meet all requirements of the private sector. Moreover, a currency board was introduced in 1998 to stabilize the currency as the mechanism ties the performance of the lev to that of the EUR.

But economic development in Bulgaria has shown positive trends in various areas, including tourism, the capital market, and the banking system. The degree of lending in the market, including of small loans, appears to be rapidly on the rise. Infrastructure is also steadily being improved, mainly thanks to EU funding.

Bulgaria had made great progress in creating a non-discriminatory regime of national treatment for foreigners performing economic activities in Bulgaria. In late 2003, Parliament approved changes to the Foreign Investment Act, which aimed at treating domestic and foreign investors on an equal footing and reducing the time spent on administrative issues.

As a conclusion, Bulgaria is a country, which has a lot of potential and with determined effort could overcome obstacles to an improved business environment.