Foreign direct investment in Bulgaria: patterns and prospects

Abstract

This article examines the nature and role of foreign direct investment in Bulgaria. Set in the context of the transitional economies of the countries of Central and Eastern Europe, the article serves to illustrate the importance of foreign direct investment in bolstering the market system, rebuilding the economy and underpinning the success of the privatisation process. An account of the pattern of foreign direct investment in terms of time period, sector and nationality of the investor is presented from official data sources. Since the collapse of communism the Bulgarian economic and political climate has been one of the least conducive in Central and Eastern Europe to the attraction of foreign businesses; however, recent reforms, and in particular the election of a new government, provide the beginning of a more favourable environment for foreign direct investment in Bulgaria.