Bulgaria

Ease of Doing Business Rank: 61

Overview

 

Geographic location

Bulgaria is a southeastern European nation on the Black Sea. Romania lies to the north, Hungary and Serbia to the west and Greece and Turkey to the south.

Spoken language

The official language of Bulgaria is Bulgarian, spoken by almost 89% of inhabitants. Minority languages include Turkish (8.86%) and Romani (1.13%).

According to a 2012 Eurobarometer survey, English is the most widely spoken foreign language (25%), followed by Russian (23%) and German (8%).

Population

The 2019 population estimate is 7 million.

According to the 2011 census, Sofia is the largest city (1,204,685), followed by Plovdiv (338,153), and Varna (334,870). All other cities and towns have populations of less than 300,000.

Popular industries

The top industries in Bulgaria are energy, mining, manufacturing, metallurgy, machine building, agriculture and tourism.

Education

The Legatum Prosperity Index ranks Bulgaria’ education system 49 out of 149.

Popular entity types

The most common type of business entities in Bulgaria are Limited Liability Company, Joint Stock Company, Limited Partnership, General Partnership and Partnership Limited by Shares.

The overwhelming majority of businesses are in the form of a Limited Liability Company.

Bulgarian incentives for business

Bulgaria offers a corporate tax exemption to companies investing in production, providing they locate in a high unemployment area and have no employee social security debt. The amount exempt is based on wages paid or equipment re-investment amount. The incentive lasts for 5 years.

The country also offers 6 free trade zones strategically located in major transportation hubs, including one near the country’s largest Black Sea port. Free trade zones offer unrestricted profit transfers abroad, duty-free areas, warehousing, storage and distribution facilities and other services.

History & Features

 

Main cities for business

Sofia is the capital city and financial center of the country.

Popular historical & tourist attractions

Bulgaria has a rich, diverse history and outstanding architectural and archeological wonders. The country has 10 UNESCO World Heritage Sites, which is very impressive considering it is about the size of New York State.

The Ancient City of Nessebar on the Black Sea is more than 3,000 years old and was originally an ethnic Thracian settlement. Later, it became a Greek colony and a prominent Byzantine town.

Other Thracian marvels are the tombs at Sveshtari and Kazanlak built around 300 BC. One tomb holds 10 well-preserved high relief female carved figures while the other has a round burial chamber with frescoes, the only Hellenistic example of its kind anywhere in the world.

Bulgaria is also home to many incredible Orthodox monasteries including Rila and Bachkovoo. Rila is the best-known and is a fine example of Bulgarian Renaissance architecture and Slavic cultural identity during the 18th and 19th centuries. Bachkovo was founded in 1083 and the ossuary remains intact.

The Aleksander Nevsky Cathedral in Sofia was built between the years 1882 and 1912 to honor the lives of Russian soldiers lost during the battles against the Ottoman Empire. Topped with a 45-meter-high gold-plated dome and filled with intricate decoration, it is city’s most iconic structure.

The country also offers many areas of outstanding natural beauty, including Pirin National Park. This Balkan jewel includes towering peaks and crags, meadows, rivers, waterfalls and 70 glacial lakes. Visitors can ski or skate in the winter and hike or mountain bike in warmer months.

The region on the Black Sea is a favorite for those who love the sun and water. Sunny Beach lives up to its name with eight miles of soft sand and an average of over 200 hours of sun per month from April until October. The area has plenty of nightlife, good restaurants and water sports.

History

Bulgaria sits at the crossroads between Asia and Europe and has been influenced by many cultures. The earliest major influence was the Thracians, a group of Indo-European tribes on the Balkan Peninsula from about 1000 BC. These tribes never united, but traded with Greeks who colonized the Black Sea area. However, by 200 BC, the Roman Empire dominated Europe.

By 50 AD, Rome had obliterated the Thracian tribes and the region was divided into several Roman provinces. Simultaneously, Slavic peoples started to migrate from east Ukraine and Rome allowed them to settle in the area.

Several consecutive waves of Slavic migration throughout the 6th and the early 7th centuries led to a strong Slavic region. However, warring Turkic people from the steppes of Eurasia gradually extended their rule over the Slavs and established the Bulgarian Empire.

The ruling Bulgars adopted the prevailing Slavic language and the merged communities merged became the first ‘Bulgarians’. The empire expanded and at its peak it was the biggest on the continent encompassing all lands between Greece and Ukraine and the Black and Adriatic Seas.

By 1400, the power of the Ottoman Turks was unrivaled. They dominated Bulgaria by the mid-15th century. The country suffered greatly under Ottoman rule and Bulgarians revolted, to no avail.

By the end of the 18th century, Turkish tolerance led to more freedoms for some wealthy Bulgarian merchants. This sparked a movement for Bulgarian liberation and an uprising ensued in 1876. Turkish forces massacred thousands and many European nations reacted strongly to the “Bulgarian Horrors”. However, the strongest reaction came from Russia who declared war on the Ottomans in 1877.

Russians and Bulgarians fought side by side, defeated the Ottomans, and liberated Bulgarian lands. A treaty established an autonomous Bulgarian principality, but other great European powers were reluctant to agree to the treaty and a large Russian state on the Balkans.

As a result, Germany and Britain revised the treaty and scaled back territorial size, leaving many ethnic Bulgarians outside of the new country. Surprisingly, Bulgaria did not become a Russian ally because they feared they would become part of their empire. Instead, they supported Britain.

During the following decades, Bulgaria’s leaders forged their independent state and tried to modernize. However, from 1913 until World War II the country experienced political and social unrest, many wars and a stagnate economy.

Germany occupied Bulgaria in World War II, but Bulgaria refused to fight the Russians or exterminate the Jews. Russia liberated Bulgaria in 1944 and by 1946 they were the People’s Republic of Bulgaria under communist rule. Communism transformed Bulgaria into a modern industrialist state with many nationalized industries.

When Russia introduced reforms and new policies in the 1980s, the Bulgarian Communist Party followed suit. However, nationalism increased dramatically, especially amongst ethnic groups.

When the Berlin wall fell in 1989, Bulgaria appointed a new party leader and other political parties emerged. By 1990, the ruling party took a new name, but many doubted a better outcome. Protests, discontent and economic crises followed and crime and corruption increased.

In 2016, Bulgaria elected a new leader with 60 percent of the vote. His hard stance on corruption, economic stagnation, price increases, low wages and unfair elections may lead to major reforms. He is highly regarded by Bulgarians and the country has seen progress.

Other relevant facts

According to the 2011 census, most Bulgarians identify as Eastern Orthodox (59.4%), followed by Muslim (7.8%) and other or no religion.

The same census found most Bulgarians identify as Bulgarian (85%), followed by Turkish (8.8%), Roma (4.9%), and other ethnic groups (0.7%).

Additional Information for Business

According to Forbes’ 2019 Best Countries for Business, Bulgaria is the 46th best country in the world for conducting business.

The 2019 Index of Economic Freedom rates Bulgaria 47th globally and states, “…corruption in public administration, a weak judiciary, low productivity, and organized crime continue to hamper Bulgaria’s investment climate and economic prospects.”

World Bank’s “Doing Business” rankings rate Bulgaria 61st for ease of doing business in the world.

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