11.12.2023
Bulgaria ranks among the top five in terms of economic growth in the EU in Quarter 3 (Q3) (July-September). In Q3 the Gross Domestic Product (GDP) increased by 1.7%, as per the express data of the National Statistical Institute (NSI). Despite the recession in Western Europe, the Bulgarian economy continues to grow by nearly 2%. At the same time, inflation in Bulgaria continues to slow down and is now at its lowest level in the past two years. In October, the NSI reported that the rise of consumer prices reversed to reach 5.8% on an annual basis.
Bulgaria boasts an unprecedented growth of Foreign Direct Investment (FDI) in the past fifteen years. With EUR 3.1 billion of FDI, as per the preliminary data of the Bulgarian National Bank (BNB), it is an increase of over EUR 1 billion or approximately 50% over the same period last year.
In this context, the government approved the Bill of the 2024 State Budget of the Republic of Bulgaria. The GDP growth is to go up to 3.2% owing to the growing investment in the economy and to reach BGN 205.8 billion. In 2025 and 2026, the GDP will increase by 3% annually and a steady increase of about 11% is expected for the Bulgarian citizens’ income; the percentage for the increase of pensions will be the same. The minimum salary went up from BGN 780 to 933.
The budget parameters for 2024-2026 conform to the Maastricht criteria with a budget deficit for the General Government sector of 2.9% of the GDP in 2024, 3.0% of the GDP in 2025 and 2.5% of the GDP in 2026 and thus the country meets one of the key criteria for accession to the Eurozone.
For the first time in this budget, the investment program is presented in annexes so that all national and municipal investment projects are transparent and easy to trace. The target of the key policies is to improve the demographic landscape in the country with a number of measures relevant to childcare and support to the parents who raise children. The draft version of the budget maintains the basic tax rates as they were while proposed changes seek “to illuminate” the economy so as to improve tax collection.
Investment for the future and business with higher added value
The budget for the start of the first measure under the new program Competitiveness and Innovation in Enterprises is BGN 293.4 million. Application procedures were launched for implementing innovations in Bulgarian companies. Micro, small, medium-sized companies and companies with a staff of up to 499 employees from various sectors of the economy can apply online, the time limit being 31 January 2024.
Class “A” Certificate for Investment was awarded to the Phoenix Pharma IT Services for opening a software development hub in Bulgaria. The new investment project is worth BGN 500,000 and plans the creation of 80 new jobs.
Successful third Schengen mission confirms that Bulgaria more and more effectively counters illegal migration
European Commissioner for Home Affairs Ylva Johansson described the recent mission in Bulgaria involving experts from 13 EU member states as “really successful” and reiterated her goal of the country’s accession to Schengen with Romania this year.
In keeping with EU priorities, Bulgaria stepped up its efforts to counter the illegal trafficking in human beings. Owing to the efforts of the Border Police and the other police departments, a total of 193,000 illegal migrants were intercepted on their way to Europe until the end of November this year. The efforts to ensure security on the EU’s external border and in the Bulgarian territory contributed to the relaxation of the increased migration pressure along the Western Balkans route by almost 25% in 2023 compared to last year.
Full mobilization to deal with accidents and protect the population against the snowstorms nationwide
All institutions worked in sync and full mobilization to prevent and deal with the accidents and to protect people throughout the country during the snowstorms in late November. Ministries and their agencies and organizations were prepared in advance and prevented grave accidents and irreparable damage. The normal course in the communities was resumed in cooperation with the local authorities while the institutions in charge responded to messages about problems round the clock.
The cases included the assistance to a stranded passenger train with 150 passengers on board in the municipality of Soungourlare; the rescue of 38 passengers from a broken-down bus in the municipality of Lovech, of 24 Ukrainian citizens trapped between the village of Obrochishte and the town of Balchik, of 15 hikers around Pleven, of 25 mountaineers from the Akademik Chalet and 43 mountaineers from the Vurhovruh Chalet in Plovdiv Municipality. Some 30 cars and 50 individuals of who ten were children were brought to safety in the area of Pavlikeni. In the region of Vratsa a sick person in distress, stranded in the snowdrifts, was rescued. Assistance to facilitate an ambulance vehicle transporting a newborn child on assisted ventilation across a blocked sector was provided.
Timely and adequate support where most needed
The You Can Afford It initiative to bring lower prices for Bulgarian customers of essential food products now offers permanently reduced prices in over 400 food stores nationwide. The campaign was launched on 15 November and within three weeks alone was joined by several national retail chains and regional partners that have outlets in the regions Sliven, Pleven, Rousse, Varna, Shoumen, Turgovishte, Bourgas, Doupnitsa, Sofia (the region), etc. Results show a reduction of average 10% of the price of goods such as oil, flour, sugar, fruit and vegetables of the season.
Some 325,000 people received support for the five-month heating season stretching from November to March and this year the sum is BGN 546.95. In addition, the Committee to Monitor the Human Resource Development Program approved another 46,000 households as eligible for an one-time supplement amounting to BGN 148.35 to make up for their increased heating expenses during the last winter season.
The government granted a single sum of BGN 1,512 to relieve the families who were struck by the natural disasters on 4 November in the regions Smolyan, Silistra, Razgrad, Turgovishte, Shoumen and Varna and on 18 November in the Varna Region. The relief will go to some 450 households whose homes were seriously damaged by the hurricanes and torrential rains.
Vision for change in education with a focus on practical knowledge and skills
There will be many more practical and interdisciplinary tasks after the tenth grade at the exams of the National External Assessment from this year onwards. From next school year, such a format will be brought to children of the fourth grade. Pupils who are now in the fifth grade will be the first batch to sit for an exam of an entirely new format after the seventh grade in the 2025/2026 school year. The Ministry of Education and Science updates the curricula for computer modelling which is taught at the initial stage and for ITs for high schools in the eighth and tenth grade. The changes bring more practical tasks for learners.
Financing of activities under the national education programs continues. Some BGN 45 million were allocated for “Together in arts and sport”, “Modern, secure and friendly educational environment”, “It’s good to go to the kindergarten”, “Support to the individual development of children and pupils”, and “Study and cherish the traditions and history of the Bulgarian Army”, inter alia.
Following a government decision, an extra sum of BGN 32,500,000 will be spent to improve the teaching facilities of vocational schools in different regions of the country. A procedure is underway to establish the National STEM Center with the Ministry of Education and Science in Sofia Tech Park.
The Council of Ministers approved BGN 267,300 to pay 370 grants under the Program of Measures for the Protection of Talented Children from state-run, municipal and private schools in 2023. Also, a sum of BGN 783,279 was allocated for the compensation of families whose children were left out of the kindergartens in the period from 1 July to 14 September 2023.
Twenty-five research centers will be completed and renovated with BGN 55,727,365 following a cabinet decision to buy special equipment to do excellent research that conforms to world standards.
Meanwhile, the Ministry of Education and Science confirmed that Bulgarian researchers from the INSAIT institute would partner with NASA, CERN, leading universities such as Harvard, Berkeley and Yale and with corporations such as Sony, Intel and Dell in the mission to ensure open Artificial Intelligence.
Sustainable energy development and strategic projects to make Bulgaria a key factor in energy connectivity in the Balkans
The Ministry of Energy opened a public discussion of the Strategy for Sustainable Energy Development of the Republic of Bulgaria until 2030, with a horizon until 2050. The transition to low-emission energy gives priority attention to regions that face the greatest challenges. The security of energy supply and grid infrastructure, the sustainable use of local energy resources, decarbonization, democracy and decentralization and energy efficiency are among the strategic goals for the development of the energy sector as put down in the project. To be added to these are the integrated and liberalized energy market as well as new technologies, innovations and research.
The European Commission included two major projects with Bulgarian share in the First List of Projects of Common Interest (PCIs). Both projects are cross border projects and position Bulgaria as a key factor for energy connectivity in the Balkans. The project of the state-owned Bulgartransgaz (BTG) and the Greek DESFA (the National Natural Gas System Operator) to create a hydrogen interconnector between Thessaloniki and Sofia plans to build an infrastructure – a new pipeline that is long approximately 250 kilometers and two compressor stations in the vicinity of Doupnitsa and Koulata. The second project, Carmen 2, is a joint venture of the Bulgarian Electricity System Operator (ESO) and Transelectrica – the Romanian Transmission and System Operator (TSO) and the Romanian electricity and natural gas distributor Delgaz Grid S.A. The project plans for the digitalization and expansion of the electricity transmission of Northeast Bulgaria and Romania so as to upgrade and increase its transmission capacity for connection of newly established renewables.
More opportunities for sports and active lifestyle
Minister Dimitar Iliev approved the pilot program Sport: a Way of Living with a budget of half a million BG leva. The program promotes a healthy and active lifestyle as it improves the conditions to organize mass sports events, makes it possible for people over 18 to compete in them and to be motivated to be physically active.
The Ministry of Youth and Sports approved also the program for financial support for the development of sports clubs for 2024. As per the program, clubs from 57 sports will be financed with a budget of BGN 15 million that is about BGN 2 million over 2023. There will be an additional opportunity to finance projects in sports specifically for young people under the second procedure that was concluded in November of the National Program for Youth Activities as per Art. 10 “a” of the Gambling Act.
Transparency in management of culture and progress of international importance for Bulgaria
For the first time, the Ministry of Culture will publicly announce the nominations of new members of the Managing Board of the National Culture Fund. The decision is yet another step towards transparency and competition in the management of the Ministry’s projects and budgets.
Over 1,700 exhibits from 18 Bulgarian museums were displayed at the Silver Thrace Exhibition in the Republic of North Macedonia. Such a large-scale archaeological exhibition is visiting for the first time our western neighbor and will remain open until 7 April 2024 in the Archaeological Museum in Skopje.
UNESCO again chose Bulgaria as a Center for the Safeguarding of Intangible Cultural Heritage. The Center is run by a Bulgarian team altogether and is one of the eight Category 2 centers in the world with the mission to safeguard the intangible cultural heritage of humanity.
Meanwhile, the government approved additional expenses of over BGN 400,000 from the Culture Ministry’s 2023 budget for financial support for the Rila Monastery (St. John of Rila). The Monastery is among the most significant cultural monuments in Bulgaria, a symbol of the country and a site on the UNESCO World Heritage List.
Access to medicines and pharmacies throughout the country
Health Minister Prof. Hristo Hinkov signed an order prohibiting the export of insulin medicines until 31 December 2023. In addition to insulins and analogs, it prohibits exporting some other blood sugar- lowering drugs and antibiotics intended for regular use in child age.
The Ministry of Health reported progress on another initiative that is important for the people – a draft of a National Pharmacy Map was completed to show communities facing a shortage of pharmacies following a careful analysis of the population’s access to pharmacies.
Vision for better transport connectivity and management
The first hospital helipad for the HEMS system [helicopter emergency medical service] was certified on the grounds of Uni Hospital in Panagyurishte and is one of the six already built with four other still on the drawing table.
All patrolling cars of the Executive Agency Automobile Administration were supplied with POS terminals in the autumn. They are connected to the Agency’s electronic control system which gives, inter alia, penalty orders. In this way, it will be easier for citizens and the collection of dues will increase several fold.
The residents of and visitors to Stara Zagora will have a completely renovated railway station. This is yet another step to improve the quality of the country’s railway transport where in recent decades they let things drift. Meanwhile, work started to build the extension of Line 3 of the Sofia Metro. It is a project that includes 6 kilometers of tracks and six new stations and thus connects another four districts of Sofia with the underground transport infrastructure.
All the information about the Bulgarian seaports that was so far stored on physical media is now integrated into a national electronic information exchange system. Meanwhile the first stage of the repair program of the Varna Ferry Complex that cost BGN 5.5 million was completed.
Some 400,000 Bulgarians from 140 communities in remote areas where connectivity is not well developed, will have access to high-speed Internet of 1 Gbps via an optical networking and will be covered by the 5G mobile network. The Ministry of Finance and the Ministry of Transport and Communications concluded an agreement on the investment of BGN 470 million to come from the Recovery and Resilience Plan (RRP).
Citizens will be notified by e-mail or SMS about any penal order or an electronic ticket issued by the Ministry of Interior. The Ministry of Interior and the Ministry of e-Government presented a joint project to that effect.
Protection of the state interest in nonprofit transactions for tens of millions of leva
The government will recover some BGN 45 million from the contractor of the government compound that it did not built. The cabinet initiated the procedure of recovery of the sum by the contractor to the State Consolidation Company (SCC) that paid in advance more than BGN 70 million exclusive of the VAT in 2020. The Ministry of Economy and Industry notified the State Agency National Security and the prosecutor’s office of more than BGN 97 million in damage to the state due to a pending debt that the SCC bought in 2018 and that is still on the SCC’s balance sheet.
Bulgaria’s domestic tourism recovers to 2019 levels; inbound tourism flow reaches 90% of what it was
The National Statistical Institute reports that the domestic summer tourism is fully back to its pre-COVID-19 pandemic levels and that the inbound tourism flow has reached 90% of what it was. The data are valid for the period from the beginning of June to the end of September. Meanwhile the Ministry of Tourism works in an order of priority to regain Bulgaria’s position in the Scandinavian market. Progress was made in relations with Greece with which Bulgaria signed a Program of Joint Action in Tourism and won the prize for the most spectacular stand at the PHILOXENIA tourism exhibition. In the sixth month of government, Bulgaria attended prestigious forums in Italy, Poland, Spain, the United Kingdom and Austria.
Meanwhile Minister Dinkova together with officials representing major winter resorts, started to prepare changes to promote the modernization and competitiveness in the sector. They will focus on the solution of problems that have been overdue for a long time, such as the improvement and renovation of infrastructure, including road signs.
