Research studies

Bulgaria: Growth, Disparity, and the Power of Populism


Prepared by the researcher  : Muhammad Fawzy Ali – Assistant Professor – Ain Shams University – Cairo, Egyp

Democratic Arab Center


Thirty years after the political system change, Bulgaria has a functioning democracy, but it has long struggled with institutional problems, including an overpowering Attorney General’s Office, corruption and a media system dependent on a few politically influential economic actors. The high economic growth of the 2010s was associated with persistent poverty and widening socio-economic disparities, which contributed to disenchantment with politics and the emergence of new, populist and extremist political forces.

  1. Introduction

The democratic and free-market transformation of Bulgaria after 1989 was slow and often confused. The economic elite that emerged in the early 1990s engaged in redistribution or establishing indirect control over state ownership, often on the fringes of legality. In 1996-1997, Bulgaria experienced its deepest crisis when gross domestic product fell by 10%, the banking system collapsed and a fall in foreign exchange reserves destroyed confidence in the national currency. A currency board arrangement helped stabilize the economy and bring hyperinflation under control.

While democracy has always been the preferred form of government for much of the populace, the protracted democratic transition has been felt by many as a loss of stability and order within the state. The widespread disappointment among the population contributed to the emergence of many new political actors. In most cases, charismatic figures were at the heart of these new political parties and movements. Populist argumentation patterns that demanded non-partisan, non-ideological political action and claimed it for themselves characterized the attempts of the new actors to solicit votes in many parts of the traditional political spectrum. The first successful new political force was the exiled monarch Simeon Saxe-Coburg-Gotha (Simeon II), who won the 2001 general election with his party. However, delivering on its promises to improve life for ordinary citizens has proved difficult.

As a result, the next parliamentary elections in 2005 produced one of the most complex outcomes in Bulgaria’s post-communist history. In this constellation, the Bulgarian Socialist Party (BSP) together with the Simeon II National Movement and the Movement for Rights and Freedoms (DPS) formed a coalition government led by Prime Minister Sergei Stanishev (BSP). The Stanishev government achieved Bulgaria’s accession to the European Union in 2007 and initially enjoyed high economic growth. However, in late 2008 and early 2009, Bulgaria’s economy and industrial base suffered unexpected losses from the global recession.

In 2006, Boyko Borisov, the mayor of Sofia and a former bodyguard to communist party leader Todor Zhivkov, founded a new centre-right party (GERB). A proponent of a law and order agenda, GERB won the 2009 general election and formed a minority government led by Borisov. The government’s unfulfilled promise to fight corruption and organized crime disappointed many Bulgarians. In February 2013, the Borisov government resigned after months of sometimes violent anti-poverty demonstrations. Due to weeks of protests and after a coalition partner defected, the ensuing BSP-led coalition government collapsed just 18 months later. After a turbulent phase with two early parliamentary elections, Borisov was given a new mandate to form a government in November 2014. His coalition government was supported by the Patriotic Front – an alliance of populist and nationalist parties. Major promises of reform have not been fulfilled, partly due to the short tenure of the second Borisov government, which resigned after the GERB candidate lost the November 2016 presidential election to General Rumen Radev – a political newcomer backed by the BSP.

Following parliamentary elections in early 2017, Borisov’s third coalition government took office in May 2017, consisting of GERB and the nationalist United Patriots alliance. The 2019 European Parliament and local elections confirmed that Borisov continued to enjoy more popular support than the opposition.

  1. Democracy

Bulgaria is a functioning democracy, even if many institutional problems appear unresolved. According to international observers, the parliamentary elections of 2017 took place in an atmosphere characterized by disenchantment with politics and electoral fatigue (OSCE 2017). Some parties used inflammatory and xenophobic rhetoric, mostly targeting Roma and members of Bulgaria’s ethnic Turkish minority. At the same time, Bulgarian authorities and some political parties claimed that Turkey had interfered in the electoral process. Observers have long noted practices of vote-buying and “organized” voting.

Parliament made several changes to the electoral law that was newly codified in 2014, including to make voting compulsory and to limit voting abroad. The nationalist parties involved in the Borisov government succeeded in limiting the number of polling stations abroad and making it difficult for Bulgarian citizens of Turkish origin to vote. In February 2017, the Constitutional Court declared that repeated violations of compulsory voting should not be sanctioned. The electoral law reforms implemented some international recommendations, but did not change the mandate allocation process and the division of the electoral districts, which did not sufficiently guarantee the equality of all votes.

The general approval of democratic norms is high. In a representative opinion poll conducted in 2018, the majority of respondents (45%) identified democracy as the best form of government for Bulgaria, and the majority saw only democratic states as models of good governance for Bulgaria. Germany ranked first here, followed by Great Britain and Switzerland (Ivanova 2019b).

However, illiberal, anti-liberal and populist political and civil society actors are increasingly present in Bulgarian politics, often embodying a strange mix of different ideologies, sometimes even combined with technocratic means. In this presentation, we use the term “populism” in a broader sense than simply claiming to represent “the people” or “the will of the people.” Bulgaria’s leading populist politicians, in most cases, have a socio-economic background that places them precisely in the elite they initially denounce. Even authentic social climbers found it difficult to credibly communicate their anti-elitist identity after a legislature or term of office. The populism that can be observed in Bulgaria is articulated in anti-immigrant and xenophobic attitudes, prejudice against the Roma, opposition to sexual minorities and macho attitudes. Right-wing populist actors are difficult to distinguish from neo-fascists.

In 2020, the Bulgarian government adopted nationalist paradigms when it made its agreement to open EU accession negotiations with the Republic of North Macedonia (RNM) conditional on the requirement that the Macedonian language not be recognized as an official EU language. This demand reflected the view that a historical Macedonian nation did not exist, but that the current RNM state-nation arose through the politically motivated re-education and assimilation of ethnic Bulgarians living in communist Yugoslavia. This new official discourse, shaped by pre-modern historiographical notions of identity, provoked international irritation and criticism, but the Bulgarian government appears increasingly to be ignoring such reactions, focusing on the domestic political agenda.

Bulgaria’s population and institutions demonstrated hospitality to the first large groups of refugees from Syria in 2011, but were ill-prepared for the challenges of the refugee and migration crisis. Over the next few years, issues of national identity and immigration emerged, similar to other EU countries where the scale of immigration was portrayed as a threat by many nationalists (Reid and Templeman 2018). Refugees have been labeled either clandestine terrorists or illegal economic migrants seeking to abuse Europe’s more developed welfare states.

The professionalism of the Bulgarian public administration has improved significantly, a process that has been reinforced by Bulgaria’s EU membership. During several waves of reforms, procedures for selecting personnel and qualification requirements became more standardized (Krasteva 2018), new highly specialized bodies emerged, and the administration became better protected against political changes.

The independence of the judiciary is enshrined in the constitution. Unlike most European countries, the Bulgarian judiciary consists of three groups of officials: judges, prosecutors and investigators responsible for preliminary investigations into criminal cases. As an independent, elected body, the Supreme Judicial Council (OJR) has the task of overseeing the judiciary and thus ensuring its independence. There is great distrust in the population towards criminal prosecution and the judiciary, which are perceived as instruments and arenas for the pursuit of private interests. Some media outlets, controlled by oligarchic economic actors, target judges with no effective antidote to such campaigns.

The Bulgarian judicial system is monitored by the European Commission under a special Cooperation and Control Mechanism set up after accession to the EU. The independence of the judiciary is the first criterion that Bulgaria has to meet in the framework of the Cooperation and Verification Mechanism. In the past, the Commission has considered high-level appointments in the judiciary to be problematic because of a lack of transparency and undue influence, politically or economically motivated.

In 2017, the Commission assessed the election of the new OJR, which took place under a new, improved constitutional and legal framework, as an important reform step. However, major concerns remained about the powers of the Attorney General. The AG can control judges by requesting that the OJR suspend judges if they are suspected of having committed an intentional criminal act. The AG is not obliged to check the content of the allegations or to hear the person concerned; he also has administrative coercive powers outside of criminal law. At the same time, the AG enjoys immunity from criminal prosecution and cannot be removed from office if he is accused of misconduct.

In September 2020, the government majority proposed constitutional amendments to halve the number of MPs, split the Supreme Judicial Council into separate councils for judges and prosecutors, introduce an individual constitutional complaints law, and remove the need for a separate constitutional amendment assembly for certain constitutional amendments. Critics of this initiative accused the government of leaving the problematic powers of the AG unchanged and using the hasty proposal to distract from weeks of mass protests against the government and the Attorney General.

Bulgaria has a pluralistic media system in that there are many different media organs. However, there are serious concerns about media freedom, as the media landscape is dominated by a small number of economic actors interested in political influence, strict censorship and self-censorship practices limit editorial autonomy, fundamental ethical principles of journalism have often been violated, and media bodies lack effective self-regulatory structures. As the media exerts great influence on politics, politicians and powerful businessmen want to control the high-reach media organs. Observers assume that most of the press acts in favor of the leading political party GERB. The journalist organization Reporters Without Borders ranked Bulgaria last among EU Member States in its 2020 World Press Freedom Index (RWB 2019).

In October 2018, the Bulgarian parliament passed a controversial draft law on mandatory disclosure of media property, which was tabled in parliament by representatives of the Movement for Rights and Freedoms, including media mogul Delyan Peevski. Experts are critical of the changes, fearing the law would further damage the media landscape. The law is considered too selective as it puts undue pressure on media outlets that rely on foreign grants and donations to maintain their editorial independence.

In an online survey by the Association of European Journalists on freedom of expression in Bulgaria, 42% of the participating journalists rated freedom of expression in Bulgaria as bad, 28% even as very bad, 25% as satisfactory and only 5% as good (AEJ 2017). In a 2018 survey, every second Bulgarian said they had experienced hate speech against ethnic, religious or sexual minorities. Although television remained the main source of hate speech in terms of the number of people reached, hate speech was encountered much more often by regular internet users (Ivanova 2019a).

In Bulgaria, around 60% of citizens identified themselves as Orthodox Christians in 2011. The Bulgarian Orthodox Church (BOК) is considered by the population to be the most trusted institution in Bulgaria, although it is notoriously opaque and mostly occupies a relatively weak place in public life. However, recent conservative tendencies have made the BOК a key player in several public debates, often in alliance with secular conservatives, nationalists and activists from Protestant evangelical Christian denominations, with whom the BOК does not usually find common ground.

The BOК criticized the government’s attempt to ratify the Council of Europe’s Istanbul Convention on preventing and combating violence against women and domestic violence. In a massive campaign of fake news and messages recycled from the arsenal of international conservative movements such as “Agenda Europe”, the convention has been linked to plans to legalize a “third gender” and a conspiracy against the (traditional) family. Prayers were held in the churches and signatures were collected. Senior BOK officials threatened MPs and ministers who supported the convention with expulsion from the church.

The non-governmental sector acted as a key driver for positive change and promoted important societal issues to the public, which also helped to reduce mistrust that was widespread in Bulgarian society (Zahariev 2018). However, the emergence of nationalism and anti-liberal sentiments in politics and society created serious obstacles to the work of some civil society organizations (NGOs). The work of NGOs specializing in protecting constitutional human rights and upholding the values ​​of liberal democracy is particularly important but has become increasingly difficult (Zahariev and Yordanov 2018). Ever since the Bulgarian Constitutional Court declared the Istanbul Convention unconstitutional, NGOs promoting gender equality and tolerance towards sexual minorities have faced strong opposition, administrative obstacles (i.e. the cessation of funding for “gender” projects) and a great wave of hatred promoted by various media and spreading on social networks.

One of the biggest “victories” of populism in Bulgaria was the reduction of state party funding more than tenfold to 1 lev (1/2 EUR) per vote received. At the same time, all restrictions on personal and corporate donations to parties have been lifted. This change was proposed by the ruling party GERB after the opposition claimed that GERB had wrongly distributed subsidies to all political parties. Previously, an overwhelming majority of participants in a referendum initiated by TV star host Slavi Trifonov had backed a cut in subsidies. In 2019, 42% of Bulgarians supported the cut in subsidies, while another 25% believed that political parties should not receive any public subsidies at all.[1] Experts and NGOs such as Transparency International warned that these legal changes would endanger the existence of smaller political parties and create harmful dependencies between parties and economic elites. With this cut in public party funding, Bulgaria moved away from the “egalitarian” campaign finance systems typical of most EU countries, which focus on avoiding structural advantages for political actors based on the social status quo, wealth and financial resources (Smilov and Toplak 2007).

Due to corruption scandals and widespread dissatisfaction with the politicized prosecution, weeks of public protests against the Borisov government broke out again in 2020, combined with increasing political polarization. The pandemic exposed major inequalities in access to health care. Overburdened health services and skyrocketing mortality rates created insecurity and undermined already low levels of trust in democratic institutions. All of these factors created a vicious circle, reviving latent populist energy, which in turn fueled policy incoherence.

  1. Economic Transformation

The socio-economic developments outlined below help to understand why Bulgaria’s overall quite high (at times even spectacular) economic growth is associated with increasing social disparities and growing populism.

In relation to the wealthy countries of Europe, Bulgaria has caught up economically in recent decades, but this convergence has not directly manifested itself in a better quality of life (Lessenski 2019).

Since hyperinflation in the late 1990s, Bulgaria has maintained good macroeconomic and fiscal performance. Thus, Bulgaria’s national debt is still one of the lowest in the EU. Bulgaria has also performed well on price stability since the 2000s (ECB 2018). The relatively low price level in Bulgaria (around 47% of the euro area average in 2016) points to significant potential for long-term price level convergence.

According to the European Central Bank, Bulgaria’s long-term fiscal risks stem, among other things, from the expected increase in healthcare and long-term care spending (ECB 2018). However, demographic trends and the need to reduce what is currently very high private healthcare spending will require certain compromises between social policy goals and the imperative of macroeconomic stability.

Bulgaria’s economy is largely integrated into the EU internal market. In 2017, more than a quarter of the largest investors in Bulgaria – 28 out of 107 according to the classification of the Bulgarian Agency for Foreign Investments (InvestBulgaria Agency) – were German companies (Stanishev 2018). A recent study concludes that Bulgaria’s economic cycle is highly synchronized with that of the euro area, which minimizes the likelihood of asymmetric shocks and ensures that the ECB’s monetary policy is counter-cyclical rather than pro-cyclical to the Bulgarian economy (Todorov et al .2018). This is seen as an important sign that Bulgaria is ready to adopt the euro. Nonetheless, popular support for euro adoption shrank after problems with excessive public debt in neighboring Greece and other eurozone countries. Despite this, the government continued to pursue its goal of joining the EU Exchange Rate Mechanism II and introducing the euro.

Despite having one of the lowest tax rates in the European Union, Bulgaria still has a large informal sector comparable to other non-EU countries in Southeastern Europe (Shentov et al. 2016; Bogdanov 2018). However, in recent years the informal sector may have started to shrink (Bulgarian News Agency 2018; Mediapool 2018).

The decline of medium-sized cities is a main reason for the increasing disparities between Bulgarian regions (Dokova et al. 2018) and corresponds to similar developments in other EU member states (Servillo et al. 2017). Regional disparities have not been adequately mitigated by EU cohesion policy (Rangelova and Bilyanski 2018; Loukanova 2018). Migration from the underdeveloped regions led to further imbalances in the provision of public services, e.g. in the healthcare system.

Publicly financed goods in education and health were not provided in sufficient quantity and quality. The socio-economic changes of the last three decades have had an “ambiguous effect” on educational equity and quality (Beleva 2019). Painful reforms included the closure of numerous schools and the transfer of students to schools further away.

In the healthcare sector, Bulgaria suffered a significant loss of nurses due to labor migration. During the Covid-19 pandemic, the shortage of nursing staff was a major contributor to the many deaths. Around 900,000 people without health insurance have no access to basic medical care if they cannot pay for it themselves or have significant debts to medical providers. Gaps in health insurance coverage have forced most people to bear the high cost of PCR testing themselves. Payments for medicines represent a large expenditure for private households. In Bulgaria, as in other Central and Eastern European countries, cost aspects dominate decisions on the introduction of medicines, while treatment outcomes and aspects of the appropriate use of pharmaceuticals are much less taken into account (Rotar et al. 2018).

In the United Nations Human Development Index, Bulgaria is one of the countries with high human development, but in 2019 it was at the bottom of this group, ranked 52nd.[2] Poverty in Bulgaria is high by EU standards on a number of key indicators. After emerging from the global recession, Bulgaria experienced a sharp increase in inequality. The ratio of income between the top 20% and the bottom 20% was 8 times higher in 2018 (Eurostat, indicator [ilc_di11]): this is by far the widest range across the EU. A similar trend was captured by the GINI coefficient, which reached 40 in 2017 (EUROSTAT, indicator [ilc_di12]).

According to the Eurostat definition of at-risk-of poverty, 23% of the Bulgarian population (1.6 million people) lived below the poverty line (i.e. below 60% of the median income) in 2019.[3] This was one of the highest at-risk-of-poverty rates in the EU, with the overall rate being 17%. According to Eurostat, 33% of the Bulgarian population was at risk of poverty or social exclusion in 2019.[4] In the same year, the official poverty line was a disposable monthly household income of 348 leva (178 EUR). The legally guaranteed minimum monthly income was 75 leva (38 EUR) in 2018 and has increased by five euros about every ten years.

With less than 3% of the total housing stock in public (mainly municipal) ownership, affordable housing for the most disadvantaged is a serious socio-economic problem. Household poverty and inequality in relation to energy costs deepened (Tsanov and Shopov 2018). Massive protests against high electricity and heating bills in 2013 (Euronews 2013) contributed to the fall of the government.

  1. European Integration and Outlook

The processes within the EU are of the utmost importance for Bulgaria. Public investment mainly depends on EU funding, so any significant reduction in EU funds will affect Bulgaria. Disintegration processes within the EU would pose a significant risk for Bulgaria and could lead to insecurity and a feeling of disorientation in Bulgarian society. In particular, Brexit poses a serious direct challenge, as many Bulgarians study and work in the UK (around 130,000 Bulgarian citizens hold UK residency permits).

Participation in policies and initiatives at EU level influenced every aspect of policy design and implementation in Bulgaria. Bulgaria improved its ability to plan and monitor the implementation of EU funds. Macroeconomic studies show that EU funds had a significant impact on economic growth and other positive effects on consumption, inflation, trade, wages, employment and investment (MF 2018).

Bulgaria has become part of the EU internal market, but occupies a peripheral position in the EU economic area. It remains embedded in the Balkan region in many ways: historically, geopolitically, even economically and socially. Many border regions in Bulgaria tend to have similarly underdeveloped neighbors across the border. This is particularly true for large parts of the western border, where non-EU neighbors Bulgaria, Serbia and North Macedonia, could benefit from cross-border cooperation. The majority of Bulgarian citizens would support the EU accession of the Western Balkan countries, but not the accession of Turkey (Lessenski 2018). Enlargement to include the countries of the Western Balkans was one of the priorities of the Bulgarian EU Presidency in 2018. On the other hand, from a broader regional perspective, Bulgaria’s position is quite favourable. Bulgaria is on the way for many potential flows of goods, people and energy.

The biggest obstacle for Bulgaria is the loss of human resources due to low birth rates and massive emigration. This process is taking place in the context of a rapidly aging population, which is placing further strains on pension systems and healthcare. Some long-standing quality of life problems remain unresolved. The current situation in Bulgaria requires the implementation of long-term policies in several areas: education, health care and the pension system. Education and pension system reforms, while sometimes problematic, have been initiated in recent years. In parallel, the economy needs to adapt quickly to an aging workforce.

The negative global and local context of shrinking civil society space, as well as persistent poverty and social inequality, increase the risk of an erosion of support for civil society and an increase in anti-democratic sentiments among the general public. Bulgaria should continue to strive to play a more active role in the EU and avoid disintegration of the Union (although this risk is largely beyond Bulgaria’s control). The guarantees and incentives for Bulgaria’s development into a liberal democracy, where human rights, freedoms and the rule of law are established and protected, would be uncertain in a weakened EU, given extremist and populist tendencies and the weakened engagement of the United States.


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