The Republic of Bulgaria
The GDP of Bulgaria is one of the fastest growing in the world. The people of Bulgaria are hard workers, who are striving to maintain growth in the GDP and quality of life in their country which is becoming an economically thriving power.
The Republic of Bulgaria is one of the oldest countries in the world. The people that inhabit Bulgaria are descendants of the ancient Slavic peoples that inhabited Europe thousands of years before the coming of Christ. Bulgaria has had a rich history, transforming from a tribe into an empire that was over eight times bigger than present day Bulgaria. It has endured occupation by enemy nations twice, and both times it has repelled the hostiles and returned to its former self.
Bulgaria is located in southeastern Europe, bordering the Black Sea, with Romania to the North and Turkey to the South. The country is “slightly larger than Tennessee.”(1) Bulgaria is very mountainous, with the only sizable flatlands located in the North and Southeast. These geographical features obviously affect life and business in Bulgaria, and thus they also affect the GDP.
Bulgaria Fought on the losing side in both world wars, and after the fall of the axis powers in 1945, the country “fell within the Soviet sphere of influence and became a People’s Republic in 1946. Communist domination ended in 1990, when Bulgaria held its first multiparty election since World War II.”(1) The economic history of Bulgaria should be viewed from post 1990, because this is the time that the country switched from communism to a free market economy.
When Bulgaria became a free market economy, the change did not go very well. Bulgaria was a poor country before the revolution, and afterwards the entire country’s government and economic policies were in shambles. “Like the other post-Communist regimes in Eastern Europe, Bulgaria found the transition to capitalism more painful than expected.”(3) Nevertheless, the country had finally begun the irritable process of moving toward political democracy and a market economy while combating inflation, unemployment, corruption, and crime.”(1)
In 1991, the anti-Communist Union of Democratic Forces took office with Filip Dimitrov as the prime minister. A little over a year later the Dimitrov government had to resign as a consequence of the failure of economic policies.(4) Between 1992 and 1994, Dimitrov’s successor Lyuben Berov was not able to improve economic conditions as his government carried through the privatization of land and industry through the issue of shares in government enterprises to all citizens, as these were accompanied by massive unemployment as uncompetitive industries failed and the backward state of Bulgaria’s industry and infrastructure was revealed.”(3) Berov eventually resigned in September of 1994. (4) From 1995 to 1997 the former communist government received a majority vote and led Bulgaria into a “severe economic crisis and declining quality of life. Corruption became emblematic of the era, with shady privatization schemes, and inaction against organized crime groups.” (3) More than half of Bulgaria’s commercial banks went bankrupt in 1996, with hundreds of thousands of people losing their savings. Simultaneously, uncontrolled government spending aimed at filling the gaps in growing budget and current account deficits led to hyperinflation, with the lev’s value plummeting from 70:1 USD in early 1996 to 3,000:1 in early 1997, causing a sharp decline in purchasing power. (3) For the first time since the crisis of 1990, basic goods like bread became scarce, with the country’s grain reserves near complete depletion by February 1997.”(3) In January and February of 1997 there were massive demonstrations against the government of the Bulgarian Socialist Party which forced the BSP government to collapse.(4)
After elections were held, the UDF returned to power. “In the April elections the UDF won and was able to form a new coalition government under the leadership of Ivan Kostov, a trained economist.”(3) “The UDF government implemented a program of monetary stabilization and privatization of state banks.”(4) Since then, the Bulgarian government has put economic concerns at the forefront of their priorities. In 2007 the commercial economies of Sofia, Plovdiv, Turnovo and Ruse seem vibrant. The obvious problems in downtown Sofia are the inadequate trash collections and the failure to repair damaged streets; i.e., failures of government services. (4) Other factors that distinguish the improved GDP of modern Bulgaria with that of the past are the country’s NATO membership of 2004 and admittance to the European Union in 2007. In addition to these interesting dynamics, Bulgaria’s GDP is also boosted by “Increase in consumption and intense investor activity, the quarterly report for Central and Eastern Europe of UniCredit Group shows.”(2)
| Year | GDP | % Growth |
| 1990 | 20.62 | -55.90% |
| 1991 | 2.02 | -90.20% |
| 1992 | 8.2 | 305.90% |
| 1993 | 4.45 | -45.70% |
| 1994 | 7.82 | 75.80% |
| 1995 | 13.11 | 67.50% |
| 1996 | 9.9 | -24.50% |
| 1997 | 10.37 | 4.70% |
| 1998 | 12.85 | 23.90% |
| 1999 | 12.64 | 1.00% |
| 2000 | 12.98 | -2.60% |
| 2001 | 13.61 | 7.70% |
| 2002 | 15.61 | 14.70% |
| 2003 | 19.89 | 27.50% |
| 2004 | 23.91 | 20.20% |
| 2005 | 25.96 | 8.60% |
| 2006 | 28.32 | 9.10% |
(GDP in billions of U.S. Dollars) (5)
The GDP of Bulgaria has surpassed the pre-free market levels that it had before the crash of the communist regime, and is continuing to increase into 2008. Currently, Bulgaria’s GDP is made up of “8.1% agriculture, as opposed to 0.9% in the United States, 31.3% industry, as opposed to 20.6% in the United states, and 60.7% services as opposed to 78.5% in the United States.”(1) Agricultural products are “vegetables, fruits, tobacco, wine, wheat, barley, sunflowers, sugar beets and livestock.”(1) Industries are “electricity, gas, water; food, beverages, tobacco; machinery and equipment, base metals, chemical products, coke, refined petroleum, and nuclear fuel.”(1) Natural Resources found in Bulgaria according to the CIA Fact book are: bauxite, copper, lead, zinc, coal, timber, arable land.
Bulgarian exports include clothing, footwear, iron and steel, machinery and equipment, and fuels. Bulgaria imports: machinery and equipment; metals and ores; chemicals and plastics; fuels, minerals, and raw materials.(1) Bulgaria imports about $28.79 billion dollars worth every year, while only exporting 19.77 billion dollars worth of goods.
It is easy to overlook certain costs of GDP such as harm to the environment and depletions of non-renewable goods. Air pollution from industrial emissions; rivers polluted from raw sewage, heavy metals, detergents; deforestation; forest damage from air pollution and resulting acid rain; soil contamination from heavy metals from metallurgical plants and industrial wastes all harm the environment and should not be overlooked.
Bibliography
1. https://www.cia.gov/library/publications/the-world-factbook/print/bu.html
2. http://www.sofiaecho.com/article/bulgarias-gdp-growth-to-reach-62-in-2007-current-account-deficit-remains-high/id_22500/catid_67
3. http://en.wikipedia.org/wiki/History_of_Bulgaria#World_War_I
4. http://www.sjsu.edu/faculty/watkins/bulgaria.htm
5. http://www.econstats.com/weo/C025V019.htm
