Economy of Bulgaria

There were many factors that affected Bulgaria’s overall economic outlook. Along with the fall of Communism, the country was severely affected by the sanctions that the United Nations imposed on the neighbouring countries of Yugoslavia and Iraq.

The first signs that things were starting to turn around for Bulgaria came in 1994 when the country’s GDP started rising while its inflation rate fell. However, the nation’s economy was again tested in 1996 when a lack of international economic support along with an unstable banking system caused the entire economy to collapse.

Since 1997, the government and the country has been working steadily towards economic recovery. Bulgaria’s GDP is growing at a decent rate of between 4% and 5% a year. The nation has been seeing an increase in the amount of foreign direct investment. It is also experiencing macro-economic stability and, earlier this year they became members of the European Union.

In order to achieve so much in such a short period of time, the government has pursued very strict and specific policy objectives including retaining the Currency Board, accelerating privatization and practicing sound financial policies. They have also been pursuing structural reform – and all of it seems to be paying off brilliantly.

Among the country’s many industries that seem to be growing is agriculture with farming playing a big role in the economy. Although the number of farms has decreased the output of each facility has increased; and produce farming has taken on a bigger role than stock breeding.

Another industry that is doing very well is that of nuclear energy production. Thanks to the country’s Kozloduy Nuclear Plant, Bulgaria is a major exporter of energy. Currently a second significant nuclear plant is under construction. As well, the country has a thermal power plant in the development.

Ferrous metallurgy is another significant cog in Bulgaria’s economic wheel. It is a major producer of steel and pig iron. There are also large refineries of oil and zinc. Machine building is also a big player making up 14% of the country’s revenue while employing 24% of the country’s people.

One of the more surprising growth industries is the Bulgarian property market, which has been seeing a recent surge thanks to British and German citizens looking to purchase affordable second homes in a welcoming and attractive destination. Second home buyers have created a veritable niche market in the Bulgarian economy that is also helping to speed the country’s economic prosperity significantly.

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