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Key Economic Data 
  2002 2001 2000 Ranking(2002)
Millions of US $ 15,608 13,600 12,600 74
GNI per capita
 US $ 1,790 1,650 1,580 110
Ranking is given out of 208 nations - (data from the World Bank)

Books on Bulgaria






Georgi Purvanov

Private sector
% of GDP


Bulgaria earned its independence from the Ottoman Empire in 1878, but having fought on the losing side in both World Wars, it fell within the Soviet sphere of influence and became a People's Republic in 1946. Communist domination ended in 1990, when Bulgaria held its first multi-party election since World War II and began the contentious process of moving toward political democracy and a market economy while combating inflation, unemployment, corruption, and crime. Today, reforms and democratisation keep Bulgaria on a path toward eventual integration into NATO and the EU - with which it began accession negotiations in 2000. 

Update No: 085 - (01/06/04)

The Bulgars are being re-appraised by foreigners as a potential partner and site for investment. The country has had a very difficult transition to capitalism and democracy, having been the cosiest, that is the least rebellious, of the Central Europeans under communism. There was no question of a 1956 or 1968, as in Hungary and Czechoslovakia, nor of a Solidarity, as in Poland. When it all ended it was with a whimper, not a bang, as in East Germany and Romania.
The Russians had been seen as liberators, which, indeed, they were in 1878, evicting the Turks. The Bulgarians settled down to be the faithful partner of the Soviet Union, just as their King Boris had been a good ally of Hitler's.

The future IT hub of SE Europe
There was one virtue in communism, its enormous stress on education. The Bulgars are highly educated on the whole, rather more so than their Western European counterparts. Marxism was not an intellectual creed for nothing. According to World Bank data, Bulgarian education ranks fifth in the world.
The Bulgarians have taken to information technology (IT) like a duck to water. They are acknowledged often as brilliant by world experts.
Bulgaria's advances on the information technology sector and the potential they bear were welcomed by the US market during a recent forum by the Business Council for international Understanding (BCIU) in New York. The forum, entitled "Bulgaria: A New IT Destination for US Companies," heard a speech by Bulgarian Deputy Prime Minister and Economy Minister, Lidia Shouleva, who was paying an official visit to the country.
The international market niche for Bulgaria in the IT and telecoms sectors is where there is a demand for products requiring innovation and creative thinking, President of PacTac Advisors, Dennis Smith, said at the forum. Smith's functions include consultation for choosing target regions for IT investment. "Bulgarian companies are already offering solutions to rare problems," Smith said.
The forum was attended by senior executives of 20 leading US companies operating in IT and finance, including IBM and UBS. Some participants represented Bulgarian-owned companies operating in the United States. "The Sofia government aspires to make Bulgaria the IT hub of southeastern Europe," Shouleva said, presenting a strategy to enhance Bulgaria's competitive power on the global IT and telecoms market and the advantages of investing in Bulgaria. "The country has highly qualified specialists offering competitive conditions in terms of labour cost. Bulgaria is also home to businesses offering custom-built hi-tech systems," she added.
BCIU president and CEO, Peter Tichansky, noted that the special forum was taking place at a time when a growing number of US companies request information from the BCIU as they seek ways to establish a foothold on IT markets in Europe. In the official press statement, Tichansky said that given Bulgaria's future accession to the European Union, "the BCIU believes that the country can be recommended as a partner."
The US business persons attending the forum expressed their shared view that Bulgarian firms are competitive in IT services not because their services are inexpensive, but because they offer high standards and innovative ideas.

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Austrian Airlines eyes Bulgaria

Austrian Airlines is interested in the privatisation of Bulgaria Air, CEO Vagn Sorensen told Standard News daily recently. 
According to the report, leaders of the biggest Austrian companies such as OMV, BAWAG, Soravia Group and Erste Bank met with Bulgaria's Economy Minister, Lidya Shuleva, in Vienna. Shuleva took part in the investment forum dedicated to Bulgaria, which attracted numerous Austrian companies, including Raiffeisen Bank, Bank Austria, Alstom Power, Neumann Communications, Telecom Austria, etc.

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PSL clinches pipeline

PSL Energy Services has won a pipeline pre-commissioning contract in Bulgaria, the British-based group announced recently. It is believed the Aberdeen-based company is the first British firm to have been contracted to carry out this type of work in the east European country, local Standard daily reported recently.
The six-figure award by Petrico SARL - a subsidiary of Edinburgh-based Melrose Resources - is for pre-commissioning on a 14-inch diameter pipeline from Varna to an offshore platform on the Galata development in the Black Sea.
The work scope includes flooding with water, pressure testing and line dewatering, with PSL supplying pumps, compressors and personnel, the group said in a statement.
"As far as we are aware this is the first time a British company has been used for this type of work in Bulgaria and we are delighted to be involved in the initial development stages of the Galata project," a group official was quoted as saying by Standard.

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Zagora brewery ready to launch Heineken beer

After Amstel, the Zagora brewery is set to launch the Heineken brand on the Bulgarian market. "The brewery in the southern town of Stara Zagora is fully equipped to start a Heineken production line, but we are still on the marketing research blue-print," Zagora's brand manager, Rumen Kolev, said recently, novinite reported.
However, the Dutch-Austrian brewery investor intends to keep working on Bulgarian soil with the current facilities according to Braw Union's CEO, Dr Karl Bueche. The factory located in the town of Stara Zagora has been acquired by Braw Union, a grand merger between Dutch Heineken and Austrian BBAG. Thus the brewery group has swept into the lead in Central and Eastern European markets, including Bulgaria, FYR Macedonia, Romania, Austria, Hungary, Slovakia, Poland and Albania.

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EIB allocates €20m for SMEs

New Europe reported recently that the European Investment Bank (EIB) has provided a €20m global loan to Raiffeisenbank Bulgaria to finance projects of small- and medium-scale enterprises (SMEs) and municipalities in the Balkan country, quoting a recent statement by the bank. The global loan will serve for the financing of small- and medium-scale projects in the field of environmental protection, infrastructure, industry or tourism.
This is the second global loan signed with Raiffeisenbank Bulgaria. The first EIB global loan with this bank, amounting to €10m, was signed in October 2002. It was allocated within 8 months for financing sub-projects, mainly in the tourism sector. EIB global loans have been developed as a successful tool in providing long-term EIB funds for financing small projects implemented by the SMEs sector or by municipalities under favourable conditions.

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Sofia seeks expanded IT market

Bulgaria's IT market officials recently convened to discuss the positioning of Bulgarian IT production on the international market. Members of the Economic Policies Committee recently went over the state's strategy for development in that field. Another key subject of the talks was privatisation deals in the power-producing sector. Bulgaria boasts a high number of IT professionals, some of them having earned international recognition, novinite reported.

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Kremikovsti in investor quest

Bulgaria's largest steel plant, Kremikovtsi, is seeking fresh investments from abroad, novinite reported recently.
Finmetals Holding, is currently in talks with four foreign investors interested in the whole or partial purchase of 71% stake via a share swap. Kremikovsti's CEO, Valentin Zahariev, said the deal is likely to be concluded by the end of this year. Finmetals bought the state-owned ailing steelworks in 1999.

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Bulgargaz and Cabletel build national fibre optic network

Bulgargaz and CableTel will jointly build a national fibre optic infrastructure, New Europe reported recently. 
The two companies recently signed a framework agreement on a strategic partnership. They did not reveal any particular project or way of working together because these details are still under negotiation. A separate contract on the specific projects will be signed at a later stage, the companies said. "Most of the money for building the optic network will be invested by our company," Ronald Finley, one of the shareholders in CableTel, revealed. Gegov announced that Bulgargaz is in negotiations also with other private telecom operators.

No open tender for 3rd GSM licence gets government support

The Bulgarian government recently supported Bulgarian Telecommunications Company's (BTC) awarding of a GSM licence without open tender. In a letter to the State Communications Regulation Commission (SCRC), which is to rule the complex mobile licensing case, the cabinet highlighted its stance, New Europe reported recently.
According to the letter, the law provides for the option of granting a licence without auction or open tender, written down in Art 39 of the Privatisation and Post Privatisation Control. The cost of the licence is included in the price set out in the privatisation contract, but it is payable by BTC, not by its new owner, experts said.
The SCRC holds back the GSM licence issue awaiting the sale of Bulgaria's first mobile operator - MobilTel. If BTC is granted the licence before that, the price of MobilTel may sink sharply. However, officials from the company denied any connection between the two deals. The issue of the third mobile operator licence award was one of the crucial conditions and potential deal-breaker for the finalisation of the landmark sale deal for a 65% stake in the BTC to Viva Ventures. Following a last-minute breakthrough the sale contract was signed late on February 20th.
The GSM licence was offered among the other parameters of the deal, publicly announced at the beginning of 2002. A problem arose following the recent adoption of legal amendments, under which holding a tender is the only way for issuing a licence.
The provisionary deadline for finalising the deal expired on April 20th, when BTC's buyer must have paid off the contracted price about the 65% equity stake. Reportedly due to controversies over BTC's privatisation deal, the head of the sale body, Ilya Vassilev, handed in his resignation recently. Meanwhile, Transport Minister Nikolay Vassilev stated that it is highly likely BTC will be granted the third GSM licence in due course. "Otherwise, Bulgaria's telecom privatisation deal would be gravely breached," he told a local private channel.

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Tourism industry to draft destination Sofia strategy

Bulgaria's business market is currently preparing a strategy and an action plan for the development of tourism in Sofia, New Europe reported recently. 
The initial project, drawn up by the Council of Tourism - Sofia, was presented at a recent meeting of tour operators, hotel owners and tour guides, with the municipal authorities and the ministries of economy and culture. The document should be ready in due course.

EU tourists favour Bulgaria

Tourists from European Union member states are fast increasing in number in Bulgaria, a recent report by the Economy Ministry's Tourism Analysis and Forecasts Department said, BTA reported. 
Compared to an average increase in the number of foreign holidaymakers, those from the EU countries increased by the record high 45.86%. 
A total of 787,667 Bulgarians travelled abroad in the first quarter of 2004, up by 21.20% year-on-year. Turkey is the top visited destination, chosen by 274,085 Bulgarians. Greece comes next with 103,381 trips by Bulgarians, followed by Serbia and Montenegro 77,957 trips and Germany 60,235.

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