Balgarianovinite.com The emotions surrounding the adoption of the euro in Bulgaria on January 1, 2026, have understandably led the public and the media to preoccupy themselves with consumer inflation, but this holds a risk to overlook processes which are more important for the state of the national economy and related pitfalls. Data about industrial producer prices, which has just been released, shows that in November 2025 Bulgaria’s manufacturing industries exhibited the highest annual price increase in the European Union, at 10.8%. By contrast, many other EU countries experienced deflation of industrial producer prices, and generally, the European single market saw price stagnation. Is Bulgarian industry losing competitiveness, and why is this important? The question is discussed by Latchezar Bogdanov, chief economist at the Institute for Market Economics (IME), in an analysis published on the IME website on January 9.
Bogdanov says that Bulgaria is a small and open economy, and its long-term growth potential largely depends on the ability of local producers to compete successfully on the global market. This is crucial when it comes to internationally tradable goods, unlike many services, which are mainly targeted at domestic consumption. According to the expert, early indications of structural transformation were observed in the second half of 2023 as the relative weight of the export of goods declined from an average of 49% of Bulgaria’s GDP in 2015-2022 to 46% in 2023 before slipping further to 42% in 2024 and an estimated 38% in 2025.
One of the reasons is, undoubtedly, that the output of Bulgarian industrial enterprises has become costlier, particularly when compared to the country’s principal export market, the EU, the analysis goes. It cites Eurostat data showing that the total producer price index in the manufacturing industries as of November 2025 is +10.8% in Bulgaria, which is the highest rate of increase in the EU, followed far behind by Romania’s +4% and Slovakia’s +2%. Another 12 member states reported an increase of 1.4% or less, and 11 economies saw a decrease.
In Bulgaria, industrial producer prices in the manufacturing sector have grown at various rates across subsectors. In November 2025 compared with November 2024, the highest increases were recorded for intermediate consumption goods (+15.6%) and non-durable goods (+13.2%), while investment goods appreciated by just 2% and consumer durable goods depreciated slightly, the IME chief economist says.
Among individual manufacturing industries in this country, producer prices grew most notably in the production of basic metals (+24.7%), foods (19.6%), drinks (14.2%) and chemicals (13.6%). Double-digit increases were also observed for textiles and textile products, apparel, and plastic goods. Most notable decreases were reported for tobacco products and furniture. In many industries which have served as principal drivers of Bulgaria’s industrial modernization over the last decade, producer prices remained basically unchanged, with the manufacture of machinery and equipment even recording a slight fall, and relatively small price growth margins being registered in the production of vehicles and car parts, electronics, and optical and other high-precision instruments. For electrical machinery and equipment, which account for the largest share of Bulgarian exports, producer prices showed an annual increase of 6.8% in November 2025.
Bogdanov says that the continuing rise of labour costs certainly impacts the end-prices of Bulgaria’s industrial products, but this is rarely the case in other EU countries in Central and Eastern Europe, where pay rates also increase rapidly. When productivity grows pre-emptively, it is possible for the end-prices of manufactured goods to fall even though workers’ wages may be on the rise. It should also be noted that some prices are determined by international markets while others are mainly influenced by the domestic market. In the latter case, market demand is the result of the combined impact of fiscal policies and the change of the disposable income of households, and supply depends on the market structure, existing regulations and any barriers to new participants. Under any hypothesis, however, the data indicates increasing risks for the growth potential and the competitiveness of the Bulgarian economy, the expert says.
He adds that Bulgaria’s industrial production index was declining throughout the whole of 2025, which is directly linked to external demand and the dynamics of Bulgarian exports. These are important developments, the analyst says, because expectations for the period 2026-2028 are that domestic demand will cool slowly as the possibilities for additional boosts through the state budget get exhausted and lending inevitably cools down. Therefore, raising productivity and reinvigorating exports are key to keeping Bulgaria among the euro area top three in terms of economic growth over the medium term, Bogdanov concludes. Is Bulgarian Industry Losing Competitiveness? Institute for Market Economics Provides Insights 2026 THE NEWS FROM BULGARIA – NEWS AGENCY 2009-2025 2026-01-10 12:40:00 Latest news World news Country news Most important news latest news most important latest of the day Justice Petar Nizamov Feathers Petar Nizamov- Feathers Justice bg iustitia.bg iustitia iusticia usticia investigation Burgas Bulgaria news news of the last hour news of the day news of today Bulgaria news The news from Bulgaria blitz news top news most important most commented latest news Boyko Borisov news weather coronavirus news news weather facebook youtube facebook instagram news today news of the last minutes news today today news news bg news leading news hot news bg news site for news all news news bg news of the last hour latest latest news bg news of today news today news today news of the last hour latest news today news bg news news 24 hours news vesti bg novini news world bird bg bivol bg bivol trud bg novini latest news today novinite bg news hello bulgaria political party coat of arms delyan peevski scandalous Bulgarian National Television Free Europe Television scandal exclusive live tv live right now tv tv online tv program bg live now tv news online tv online live court Burgas court Burgas district court Burgas court Burgas district court Burgas district court Burgas appellate court Burgas prosecutor Burgas prosecutor’s office Burgas district prosecutor’s office Burgas district prosecutor’s office Burgas district prosecutor’s office Burgas district prosecutor’s office Burgas district prosecutor’s office Burgas district prosecutor’s office Prosecutor General Ivan Geshev Prosecutor Geshev Tsatsarov Ministry of Internal Affairs Burgas ODMR Burgas ODPR Burgas police Burgas district police Burgas prosecutor Tsatsarov SGS cases Varna court chairman of the SGS court decisions on civil cases decisions on cases Plovdiv court decision of the court decisions cases Varna court criminal cases district district court decisions work in the court SGS chairman of the SGS judges Sofia court post judges Plovdiv court Plovdiv judges Plovdiv Supreme Court Inspectorate Supreme Court Supreme Judicial Council lawyer lawyer criminal cases lawyer civil cases lawyer marriage cases lawyer administrative criminal law criminal process civil law civil process administrative law constitutional law