Sustainable Policies


Economic Policies

Despite notable progress in recent years, Bulgaria receives comparatively low scores in international comparison (rank 31) with respect to economic policies. Its score on this measure has risen by 0.7 points relative to 2014.

The country’s economy continues to show positive gains, with economic growth remaining strong. Employment levels have reached a record high, nearing EU averages, while unemployment rates have hit a record low. However, real capital formation growth rates are low, and the industrial sector has shown lackluster performance.

Monetary stability has boosted overall performance, and fiscal policy has been sound. Businesses complain about judicial-system problems that result in property-rights and contract uncertainties, state corruption, and the lack of skilled labor. Regional development is very uneven, and R&D spending is relatively low.

The tax system is heavily VAT-dependent, with direct taxes a comparatively small share of government revenues. Personal and corporate-income taxes are set at a flat 10% rate. The government has maintained small fiscal surpluses for several years. Public debt levels are low and declining, at about 20% of GDP. The country is making preparations to join the European banking union.

Social Policies

With significant gaps in its safety net, Bulgaria falls into the bottom ranks internationally (rank 40) in the area of social policies. Its score on this measure is unchanged relative to 2014.

Education quality is comparatively low, with significant geographical variance. Children from upper-income families often attend private schools. Income inequality levels are high, with a rising trend. Social policies have difficulties in integrating minorities, foreigners and people with sub-secondary-level education. The rate of decline in the share of people living in severe material deprivation has been the EU’s highest.

The healthcare system is inclusive, with key outcome indicators improving in recent years. Economic growth has improved the system’s financial stability. However, unregulated side payments to doctors are widespread, securing faster and better care. Public provision of childcare is limited, with parents often depending on family support networks to work.

The pension system does not effectively reduce poverty among the elderly, and is fiscally unsustainable. No policy for integrating migrants exists; rather, policies seek to prevent migrants from entering the country. Charities have helped feed and clothe refugees, averting humanitarian disaster. The issue of violence against women has not been effectively addressed by state institutions.

Environmental Policies

With a cautious climate policy, Bulgaria falls into the middle ranks internationally (rank 21) with regard to environmental policies. Its score in this area has declined by 0.1 point relative to its 2014 level.

Improvements in energy efficiency and a shift to fuels with lower carbon-emission rates have decreased the country’s CO2 intensity. However, policymakers have been slow to develop a national climate-policy strategy. The share of renewables in the country’s energy mix has stagnated since 2013. The population is among the EU’s most skeptical with regard to the urgency of climate-change policies.

Water management remains a major problem. Responsibility for this task lies with municipalities, hampering coordination and strategy development. Air quality is low. Forest and biodiversity protection are strengths. Conservation-focused groups are influential, although business interests with access to policymakers continue to violate environmental policies.

Bulgaria is relatively passive with regard to international environmental policies, but is in the group of East-Central European countries that have expressed caution regarding aggressive carbon targets.

Robust Democracy


Quality of Democracy

With a number of weak spots, Bulgaria falls into the bottom ranks internationally (rank 36) with regard to democracy quality. Its score on this measure has declined by 0.4 points relative to 2014.

Following a referendum, state financing of parties has diminished, giving a greater role to uncapped business-sector donations. Parties are required to submit financial reports, and penalized for irregularities. Voting is technically compulsory, but there are no penalties for failing to vote.

Media independence has declined, with a number of investigative journalists losing their jobs, and organizations subject to significant outside pressure. Many private media firms are owned by business groups with government contracts. The right to speak freely and protest is well established.

The overuse of force by law enforcement, particularly against Roma, is a serious problem. The Roma minority is highly marginalized, and the public discourse is increasingly xenophobic. Legal certainty is undermined by unpredictable executive action. Judicial independence is improving, but the head of the anti-corruption agency was forced to resign after dubious practices were exposed.

Good Governance


Executive Capacity

With a relatively weak government office, Bulgaria receives comparatively low rankings (rank 35) in the area of executive capacity. Its score on this measure has fallen by 0.2 points relative to its 2014 level.

The government office plays a largely administrative role, but is developing policy-evaluation capabilities. The prime minister has little formal power over ministers, but a powerful PM can exert significant informal influence. Informal coordination has been complicated by a schism in the junior-partner coalition. Line ministries prepare proposals without significant central input.

Promising reforms have improved the RIA system, but assessments are still formalistic. Though ex post assessments are technically required, they are not regularly performed. The government enforces regulations in an inconsistent and often biased way. Public communication often appears aimed at hiding rather than highlighting the true intentions behind policies.

The country’s EU and NATO memberships have driven adaptation. A serious leak of personal data by the revenue agency exposed serious monitoring flaws. The country has completed all measures included on a roadmap for integration into the euro zone and EU banking union. Municipalities often complain of unfunded mandates.

Executive Accountability

With several notable gaps in monitoring effectiveness, Bulgaria scores relatively poorly overall (rank 32) in the area of executive accountability. Its score in this area has declined by 0.1 point relative to 2014.

While activist citizens and businesses tend to have a strong grasp of current policies within their areas of interest, policy knowledge more generally is highly uneven. Most print-media organizations prioritize their owners’ businesses over strong reporting, and outlets are sometimes actively pressured not to cover substantive policy issues. Online media are gaining in importance.

Parliamentarians have very limited resources, and formal executive-oversight powers are not always respected in practice. The Audit Office performs its tasks in a clear and professional manner, and makes its findings available to the public, but lacks the power to act on its findings. A massive personal-data hack in the revenue agency exposed the weakness of the data-protection commission.

Political-party decision-making styles differ. Economic-interest associations have relatively strong capabilities, with labor unions drafting proposals on a very wide range of economic and political issues. Other interest organizations are more activist than analytical.
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