In 2022, Bulgaria's gross domestic product (GDP) grew in real terms by 3.4%, with private and public consumption both contributing to this. Positive developments in the labour market, an increase in consumer credit, and government measures to support households are contributing to household consumption growth. Over the last decade, GDP per capita in purchasing power standards has generally increased.

Government gross debt as a percentage of GDP declined from 70.7 percent in 2000 to 22.6 percent in 2022, but in absolute terms over the same period increased from €10,177.1 million to €19,352.9 million.

With all measures against the spread of COVID-19 lifted, employment recovers in mid-2022 and the annual increase is 1.3% over the 2021 average. Despite the recovery in employment and firm activity, there was a labour shortage in 2022. In the longer term, this trend will be exacerbated by a declining and aging population.

The banking system remains stable and continues to function at high levels of liquidity and capital adequacy, with limited transmission effects of the European Central Bank's monetary policy. Developments in the factors determining the demand for and supply of bank credit have contributed to strong lending activity, leading to an improvement in profitability indicators. 

Following the inclusion of the Bulgarian lev in the EU's exchange rate mechanism II, preparations for Bulgaria's accession to the euro area are targeted for 1 January 2025. Joining the euro area and the Schengen area have been and remain the main priorities of all governments that have governed Bulgaria over the last 20 years.

In 2024, together with the acceleration of the growth of the Bulgarian economy, the number of employed is expected to rise by 0.7%. In 2023, the total employment rate is 53.3%, with a higher rate for men at 59.4% and for women at 47.7%. By place of residence, employment is higher in urban areas by 13.2% than in rural areas. The employment rate of the population by age groups is as follows: 15-24 years - 18.8%, 25-34 years - 78.2%, 35-44 years - 84.2%, 45-54 years - 85.0%, 55-64 years - 69.5% and over 65 years - 7.3%. Over the past decade, the overall average employment rate of the population has ranged between 46.6% and 53.3%, with consistent trends by gender and age. There has been a decrease in economic activity in the 15-24 age group while that of the 55+ population has increased.

In 2025 and 2026, the Bulgarian economy is expected to continue to grow at a relative pace, but employment growth will nevertheless slow down mainly due to the unfavourable demographic developments in the country.

Education policy

Policies in pre-school and school education are focused on the effective socialisation of children from early childhood, ensuring equal access to quality education, personal development of children and students, promoting innovation, qualification of pedagogical specialists, modernisation of educational institutions, and digitisation of education. An increase in the funds for delegated activities in education is foreseen in connection with the continuation of the policy to increase the salaries of pedagogical specialists to reach an average salary of not less than 125 percent of the average salary for the country, to stimulate the entry of young and qualified teachers in the system of pre-school and school education. Measures aiming at reducing inequalities and promoting social inclusion, motivation of children and pupils for education, and acquisition of key competencies are also implemented. Education policies/measures are set out in Priority 1 "Education and Skills" of the National Development Programme Bulgaria 2030. They are included in the Strategic Framework for the Development of Education, Training and Learning in the Republic of Bulgaria (2021-2030).

Ensuring the conditions for quality education for all will also be supported through the implementation of a set of measures set out in the investment projects of the Ministry of Education and Science. 

According to the data of the Ministry of Finance from the Report on the Implementation of the Budget - in brief, for 2022, the spending under the Education function was BGN 6 373.4 million, which represents 3.9% of GDP. According to the Annual Report on the Implementation of the State Budget of the Republic of Bulgaria for 2005, the total funds spent under the Education function amounted to BGN 1,814.8 million, which represents 4.3% of GDP.

Source: Bulgarian National Statistical Institute