BULGARIA Trends and Developments Contributed by: Yordan Naydenov and Hristian Gueorguiev, Boyanov & Co.
will create both opportunities and challenges for businesses in the country and will require them to adapt, innovate and be on the creative side at all times. They could be, and should be expect - ed to be, not just the main growth drivers for the national economy, but also the main transaction generators. Bulgaria has a strong potential to become a leader in the digital transformation, thanks to its highly skilled and educated workforce, its vibrant start-up ecosystem and its strategic location in the region. Bulgaria has built its name as a regional IT hub, which it needs to firmly stick to, despite the “cooling” processes in the market. The country has a lot of room for improvement, but also a lot of momentum and ambition. The full implementation of the EU Digital Services Act and the EU Digital Markets Act in order to put the online platforms and services that operate in the EU under regulation, aiming to ensure fair competition, transparency, accountability and consumer protection in the digital economy, still poses significant challenges. As for the green transition, Bulgaria has a mixed record, with some achievements and some challenges. According to the Environmental Performance Index 2024, Bulgaria ranked 37th out of 180 countries (a considerable improve - ment compared to 55th place in 2020 and 41st place in 2022). The progress that the country has made in the past decade is evident, but it still lags behind many other countries, which have managed to restructure their economies in an eco-friendlier way faster. The efforts of Bulgaria should be within the EU Green Deal, the ambi - tious, comprehensive plan to make the EU cli - mate neutral by 2050. There will be many challenges associated with these. As a minimum, businesses will have to:
• Enhance their digital capabilities and online presence, and offer innovative and customer- centric digital products and services. • Invest in digital infrastructure and security, and comply with the EU regulations and standards. • Upskill and reskill the workforce, and foster a culture of learning and collaboration. • Close the gap between hiring business enti - ties and higher education centres so that fresh graduates are ready to fulfil practical business requirements from day one if pos - sible. • Fully digitalise administration and aim for a maximum application of the “one-desk ser- vice” policy. • Embrace the green transition and adopt sustainable and circular business models and practices. • Invest in green technologies and practices, in line with the EU legislation and norms. As a result, more and more businesses in Bul - garia could achieve growth and competitiveness in the region and beyond, and become either attractive targets for potential M&A deals or joint ventures or in their turn look for appropri - ate deals that would allow them to further grow and expand their activities. It goes without saying that the two trends above are of primary importance for the sectors that are meant to create and operate within that envi - ronment, ie, IT, fintech, renewable energy, etc. At the same time, the other business sectors that are worth keeping in mind are real estate (a traditional strong sector for Bulgaria), telecom - munications, leisure and tourism. We have also seen a trend to have the production capacity of Europe restored and we have witnessed deals in that field, so it could be reasonably expected that these would continue.
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