Bulgaria underwent significant transformation after the fall of the Soviet Union over three decades ago. Since then, the country has changed from a centralized, planned economy to an open, market-based, middle-income economy anchored in the European Union and NATO. The advancement of structural reforms, starting in the late 1990s, and the introduction of the currency board spurred improved living standards. As one of the EU’s newer members, Bulgaria is an emerging market offering opportunities for U.S. companies.
Bulgaria has been on a positive economic path although the Ukraine war and elevated inflation continue to pose risks for robust growth. In 2024, Bulgaria’s economy grew approximately 2.8%. Growth in the first half of 2025 was 3.2%.
The total U.S.-Bulgaria bilateral trade in goods in 2025 has continued its upward trajectory, to USD 2.1 billion, a 5% increase from the prior year.
However, downward macroeconomic pressures include the Ukraine war, a declining population, and a tight labor market. After a four-year period of repeated political stalemates, a new coalition government came into office in January 2025, bringing hopes of greater stability.
Economic growth could be driven by higher wages, EU-post-COVID recovery grant funds, and export increases. Bulgaria expects to receive up to EUR 6.2 billion (currently USD 6.7) over a six-year period (2021-2026) from the EU’s post-COVID recovery grant funds through the National Recovery and Resilience Plan to improve its economy in areas including green energy, digitalization, and private-sector development.
Bulgaria joined the European Exchange Rate Mechanism (ERM II) in July 2020 and the EU’s Banking Union in October 2020. Bulgaria’s entry into the Eurozone, scheduled for January 1, 2026, is expected to mitigate currency risk and help reduce transaction costs with some of the country’s key European trading partners as well as offer a stronger platform for long-term economic growth and stability.
This report will identify some challenges and then highlight the leading sectors for U.S. companies, which include agriculture/food products, defense, energy, environmental technologies, healthcare, IT and safety & security.
Political Environment
Visit the State Department’s website for background on the country’s country’s political and economic environment.