Bulgaria Could Reach 70% of the EU’s Average Standard of Living Within Two Years

Within the next two years, Bulgaria could achieve 70% of the average standard of living in the European Union, according to economic experts.

Macroeconomic stability and stronger economic growth are among the main factors behind this forecast, although Bulgaria remains one of the EU member states with the deepest regional disparities.

Maintaining an economic growth rate of over 4% for the next 15 years could allow Bulgaria to reach parity with the EU average standard of living.

In practice, the capital city of Sofia has already surpassed that level — but the rest of the country is lagging significantly behind.

Adrian Nikolov, Senior Economist at the Institute for Market Economics, explained:

“Most regions in the country are around 40–45% of the EU average, compared to 66% nationally and more than 130% for Sofia. These differences are very deep. Sofia, with its strong industry, continues to grow and is far ahead.”

Over the past decades, Bulgaria has made substantial progress.

GDP per capita, measured in purchasing power standards, has risen from 28% of the EU average in 1999 — when Bulgaria received its invitation to join the Union — to 66% last year.

However, business representatives warn that administratively increasing wages and stimulating consumption are only short-term measures and will not lead to convergence.

Encouraging investment, improving the business climate, and enhancing the appeal of the Bulgarian Stock Exchange — including by allowing pension funds to invest in domestic companies — are among the measures proposed by the business community to raise living standards.

Rossen Ivanov, Member of the Board of Directors of BESCO, commented:

“The potential for investment through the stock exchange is enormous, but the state should take a bold step and list other major state-owned enterprises. For example, in Romania, Hidroelectrica’s listing generated billions from private investors.”

Economic convergence, however, continues to be hampered by long-standing structural problems, such as an ageing population, a shortage of qualified labour, and the gap between the capital and the provinces.

Adrian Nikolov added:

“Political stability is key. We’ve had seven or eight unstable governments collapsing quickly — that looks bad to investors. Persistent distrust in the judicial system is also a serious obstacle, as every major investor wants assurance of property rights.”

Rossen Ivanov also pointed out:

“There are regions where state aid can cover up to 60% of an investment, but this opportunity is underused. We lack a genuine programme to encourage investment.”

Economically well-positioned industrial regions such as Varna, Plovdiv, Ruse, and Stara Zagora are considered the most likely to attract new investors in the near future.