Economy in Bulgaria

The economy of Bulgaria is a lower middle-income country coming under the Europe and Central Asia region, according to the classification of the economies by region and income, FY 2005 made by the World Bank.

The economy has made an impressive progress in the recent years by maintaining long-term stability and sustained growth. The better macro economic policies and deep structural reforms have led the average growth levels to reach by 5 % in the period of 2000-04.

The country covers a surface area of 111.0 thousand square Kilometers in the year 2003.

Demography and Social Indicators

The total population of Bulgaria was 7.8 millions in the year 2004 in comparison to 8.1 millions in the year 2000. The Growth rate of population in the country was - 0.6 in the year 2004. The growth rate of population was -1.8 in the year 2000.

The above table represents the growth rate of population in Bulgaria.

The Life Expectancy year in Bulgaria is calculated at 72.1 in the year 2003.
The Infant Mortality rate per one thousand life births in the year 2003 was 12.3.
Under 5 mortality rates per one thousand Children were 15.8 in the year 2000.

Key Economic Indicators

The Gross National Income of the country in the Atlas method was (Current US $) 21.3 Billions in the year 2004. The GNI percapita Atlas method was (Current US $) was 2740.0 in the year 2004.

The Gross Domestic Product in the year 2004 was 24.1 Billions in Current $. The annual percentage growth rate of GDP in the year 2004 was 5.6.

The following table represents the annual average growth rate of GDP in the recent years.

Bulgaria is a former communist country which from 2nd of April is a full member of NATO. It is now striving to join the European Union, which will be granted in January 2007. The country, since the fall of the socialist government in 1996 due to a major economic downturn, has experienced macroeconomic stability and positive growth rates since then (due, in part, to the introduction of a currency board in 1997) and it exists under what is now a stable parliamentary democracy with a majority in parliament and public consensus on key social and economic priorities. Currently, Bulgaria demonstrates a stable and predictable macro economic climate showing economic growth at 4.5% (one of the highest in Europe), annual inflation at 3.8% and strong growth figures in the tourism industry (up 10% in 2002 compared to 2001). The percentage for 2006 compared to 2003 equals to more than 60%. It boasts low rates of taxation across the board and has one of the lowest cost centres in Europe even though the workforce is highly skilled and qualified.

The currency is the Bulgarian Lev (1 Euro = 1.98 Lev) which is already pegged to the Euro.

Bulgarian real estate market

For the first time a Real Estate Market Index was published in October of 2002, which in March 2003 reached 104.37. A small beginning but we believe the start of a longer-term trend.

Property prices are without doubt good value in Bulgaria. This may be due in part to the general historic neglect of its asset markets and also because the Bulgarian currency (the Lev) is undervalued. In addition, the current restrictions on a foreign persons ability to purchase title to land is further affecting the liquidity of the market. With increased purchasing power will come product and asset price inflation. On the Black Sea coast this will additionally be fuelled by further growth in tourism with an increasing realisation of Bulgaria as being an acceptable alternative to say Spain, Portugal or Greece as a holiday destination and followed by increased activity in the property market arising from interest by overseas buyers in owning a second or holiday home there.

Only recently, the Bulgarian Embassy in London has informed us that they themselves are "swamped with enquiries from within the UK about how to buy property in Bulgaria".

Bulgaria has been included in NATO in November 2003, and very soon is expected the membership of the EU in January 2007. This combined with the removal of certain remaining constitutional restrictions on foreign investment in land (due to its incompatibility with EU membership) and in addition to the other factors mentioned, should cause an increase in the property markets liquidity and therefore its level. It is expected for foreign people still not to be able to buy land solely until 2014 but the process would be very eased.

In its April 2003 issue, the independent property related newsletter, Hot Property Alert was quoted as saying that "Bulgarian real estate has enormous potential". The Times was also recently quoted as saying that "if Bulgaria joins the EU there is the possibility that property prices could take off, rewarding early buyers". Bulgaria was also recently featured on Channel 4's 'A Place in the Sun' programme when it was stated that the country offered "excellent value for money for foreign investors with prices ranging from as little as £5,000 for a traditional cottage". Since that many people had the privilege to buy a property in Bulgaria at a low price and to take advantage selling it for twice or even three times the price it was bought, with a minimum work, of course.

Other respected newspapers have also run articles recently about the property bargains to be had in Bulgaria such as The Financial Times - "Time to probe Balkan Bargains" and the Sunday Telegraph with - "New kids on the Eastern Block". The Times again - "Bargain hunters look to the East".

The Overseas Property Professional magazine has with its every edition fabulous articles on Bulgaria, stating that this is "the most profitable market for investment at the moment"

The political system

There are two major parties in Bulgaria - the democrats and the socialist, who literally take in ruling the country. The other major activists on the political scene are the party of minorities/ DPS/, the agricultural party /BZNS/, the party of the son of the last Bulgarian King - Simeon II and the national party Ataka. The parties may have different views on the educational system or the healthcare, but when is about foreign investments they act in consensus. They all agree it should be done in order to make the standard in the country higher.

So, anyone can say, when it is regarding the real estate, and the foreign capital, no surprises are expected.

Tourism

Tourism is one of the key sectors in Bulgaria due to the excellent geographical location, remarkably rich nature, divers? relief and moderate continental climate. During the last three years Bulgarian tourism has been advancing progressively. According to statistic data, the number of foreign tourists (without children up to 16) who visited Bulgaria in 2001 is over 2.7 million (a 17.6 % increase in comparison to 2000). In 2002 another 10% was added to that number.

The Black Sea Coast offers an attractive seaside holiday for rest and recreation. The sunshine record is exceptional - nearly 300 days of sunshine the yearly average. The tourists enjoy various opportunities for climate and balneo-treatment, yachting, surfing, water skiing, diving, underwater fishing, other aquatic sports and diverse types of entertainment. There are special itineraries, which combine sea tourism with active tourism. In addition, opportunities for hiking, cycling, riding, photo-tourism, Eco-tourism, and excursions to natural, archaeological and cultural places of interest abound. Rila, Pirin, the Rhodopes, Vitosha and the Balkan Mountains offer wonderful possibilities for skiing and mountain tourism. The international resorts of Pamporovo, Borovets and Bansko allows one to enjoy some of the best skiing in Europe - with snow from Christmas to Easter.

Bulgaria has more than 600 hot, warm and cold mineral springs of varied physical and chemical contents, mineralization, curative gases, biologically active trace elements, temperature and curative properties that create excellent conditions for development of balneology tourism. A number of hotels with state-of-the-art equipment and skilled staff offer talasso-therapy, pearl baths, underwater massage, phyto-therapy, curative mud, inhalations, manual therapy, paraffin treatment, acupuncture, helio-prophylaxis, ozone and oxygen therapy, slimming procedures, balneo-cosmetics, etc.

Bulgaria has over 30.000 historical monuments from different historical epochs, 36 culture reserves, 330 museums and galleries all of which form an impressive base for the development of cultural tourism.

A network of three national and nine nature parks, a number of reserves and natural places are significant for the development of ecological tourism. Ecological routes offer special itineraries across exceptionally beautiful landscapes, including a system of facilities for reaching the most inaccessible beauty spots: gorges, steep rocks, and waterfalls.

Many Bulgarian villages, located in environmentally clean regions, have preserved their traditional outlook and genuine atmosphere for developing rural tourism. They are ready to open their hospitable doors to those willing to share the rich traditions and folklore, agricultural activities, preserved old crafts, and delicious and varied local cuisine.

The hunting tourism in Bulgaria relies on the wide variety of game: red deer, fallow deer, roe deer, wild goat, bear, boar, grouse, hare, partridge, pheasant and many others. Bulgaria ranks second in the world in terms of the quality of shot trophies.

As one can see, Bulgaria presents various activities to meet everyone's needs.

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