The European Commission is proposing to open an excessive deficit procedure against Bulgaria for an expected breach of the budget deficit criterion in 2026. According to the EC, the deficit exceeded the 3% limit in 2025 and reached 3.5%. However, European Commissioner for Economic Affairs Valdis Dombrovskis stressed that Bulgaria's budget deficit last year did not exceed 3%, if additional defense spending is taken into account. Based on the Commission's 2026 spring forecast, the deficit is expected to increase further to 4.1% and 4.3% in 2026 and 2027, respectively. According to Dombrovskis, the 3% excess in 2026 cannot be explained by increased defense spending, he added. "Therefore, the report concludes that the deficit criterion is not met." Government debt is also expected to increase from around 29.9% in 2025 to 32.3% in 2026 and to 35.5% in 2027 as a result of the structural deficit. Recommendations for Bulgaria include: ensuring the continuity of reforms and investments; improving the functioning of public administration, the effectiveness of anti-corruption measures; increasing the quality and efficiency of public procurement procedures and strengthening the independence and functioning of regulatory authorities; increasing the impact and efficiency of public investment in research and development; reducing dependence on fossil fuel energy production; and increasing the quality, labour market relevance and inclusiveness of education and training.

The Organization for Economic Co-operation and Development (OECD) expects the growth of the Bulgarian economy to slow to 2.5 percent in 2026 and to 2.3 percent in 2027 against the backdrop of higher inflation, rising energy prices and weakening consumption. According to the organization’s latest Economic Outlook report, higher energy prices due to the conflict in the Middle East will reduce real incomes and put pressure on domestic demand in our country. Consumption growth will slow, as the pace of wage increases and social transfers will also weaken. The organization warns that higher energy prices create a risk that inflation will remain permanently high. Average annual inflation is expected to reach 4.3 percent in 2026, before slowing to 3.4 percent in 2027. However, the OECD warns that the budget deficit has exceeded 3 percent of gross domestic product due to rising spending on social and health services, public sector wage increases and higher investment spending. The analysis also says structural reforms in the energy sector are needed.

The Parliament adopted the extension budget for 2026, which will regulate public finances until the adoption of a completely new State Budget Act for the current year. The National Assembly voted on a second reading to reduce the state subsidy for political parties, reject the planned increase in the state debt ceiling and suspend the Covid supplements for newly granted pensions. Within the framework of the voted framework, the deputies approved a differentiated amount of the state subsidy for one effective vote received under the Political Parties Act for 2026. For the period from January 1 to April 29, the party levy is fixed at 4.09 euros, while for the period from April 30 to December 31 it is reduced to 3.00 euros per vote. In parallel, the Progressive Bulgaria political formation officially abandoned its initial intention to vote on an increase in the new state debt ceiling by up to 3.8 billion euros, as requested earlier by the Ministry of Finance. Serious changes were also adopted in the field of social spending. The Parliament decided that the so-called Covid supplement will not be paid for newly granted pensions, the starting date of which is after July 1 of this year. For all pensions already accrued and granted to date, the supplement will be retained in the payment structure, and it will be additionally indexed with the coefficient obtained for the annual update of income under the Swiss rule. As of July 1, 2026, the minimum amount of the pension for insurance service and old age in our country is set at exactly 347.51 euros, which outlines the final parameters of the social package within the framework of the extended fiscal plan.

The Ministry of Innovation and Digital Transformation (MIDT) has approved 226 companies under a procedure for implementing Industry 4.0 technologies. It is part of the package of measures for the modernization of Bulgarian business under the Competitiveness and Innovation in Enterprises Program (PKIP). The companies will receive over 52 million euros for the introduction of artificial intelligence, virtual or augmented reality, 3D printing, analysis of large databases (Big Data), industrial Internet of Things (IioT), cyber-physical systems, digital twins, etc. Over half of the approved companies are from the manufacturing industry. In addition to them, companies from the trade, IT and telecommunications, professional and scientific activities, etc. sectors are also ranked. In the projects proposed for funding, expenses for the purchase of machines with sensors that collect data on the operation, quality and condition of the equipment in real time predominate. The companies will integrate cyber-physical systems into their production, which allow machines and equipment to communicate and adapt their behavior according to the data received. This will provide companies with better control over the quality of products. Some of the companies will also implement technologies related to collaborative robots (cobots), three-dimensional design and production with 3D printing, artificial intelligence, processing and analysis of big data for generating forecasts and reporting, as well as cloud technologies. 742 small and medium-sized enterprises applied for the measure. Due to the large number of companies ranked on the reserve lists, the possibilities of providing additional funds to increase the budget under the procedure will be considered.

The Council of Ministers dismissed Rumen Spetsov from the position of special commercial manager of Lukoil. Evgeni Simeonov was appointed in his place. The proposal for the change was unanimously adopted by the Security Council and confirmed by the Council of Ministers. Simeonov has been an employee of the Ministry of Economy for over ten years. His career began in 2016 as a junior specialist, and subsequently held leadership positions, including chairman of the State Agency for Metrological and Technical Supervision. Minister of Innovation and Growth Alexander Pulev motivated the reshuffle, also pointing out that there is a lack of accountability and transparency in Spetsov's work.

Long-time director of Lukoil and current hotelier Valentin Zlatev has bought a Russian abandoned property in the center of Sofia - an old residential building on a plot of almost 3.37 acres at 20 Shipka Street. The price paid is 8.59 million euros, and the deal is dated May 29. The buyer is Zlatev as an individual, and the seller is the Russian state enterprise for managing overseas properties "Goszagransobstvennost". Zlatev has also purchased a plot of 523 sq. m. and a five-story building at 11 Rayko Aleksiev Street - a massive five-story apartment block built in the 1960s for employees of the Soviet trade mission and other structures. On the territory of "Shipka" 20 there is a four-story residential block, which occupies 565 sq. m and has a total area of ​​almost 2.5 thousand sq. m, and behind it there is a one-story garage of 209 sq. m. The remaining about 2.5 acres is currently a yard. The fence of the terrain is 234 m long. The material interest in the property in question is 5.6 million euros. Or we are talking about deals for over 14 million euros. One of the main business areas of the former general director of "Lukoil Bulgaria" Valentin Zlatev is tourism, as he has several hotels on the Black Sea coast, one in Pravets and the Hyatt Hotel in the center of Sofia.

Based in the village of Samuil, Razgrad district, Trakcia AD has launched a project to improve its energy efficiency worth 100,572 euros, which is financed under the Competitiveness and Innovation in Enterprises Program 2021-2027. Half of this amount is a grant, and the rest is the company's own participation. The investment provides for the purchase of a new compressor and the replacement of lighting in the production workshops with modern LED equipment. The company has many years of experience and traditions in the production, repair and modernization of various types of wagons - open, platform, specialized, tank wagons and covered. The company's production base covers an area of ​​160 thousand square meters. The project will last 12 months and is expected to be completed in April 2027.

Bulgarian fintech company Paypercut announces a €5 million seed round led by British funds Concentric, Passion Capital and Araya Ventures to transform payments in Eastern Europe. The company also includes Polish-American SMOK Ventures and British Portfolio Ventures, Main Set, and has Bulgarian participation in the form of BrightCap Ventures and MFG Invest. The startup is building a payments and installment payment (BNPL) platform for small and medium-sized online merchants in CEE and already works with over 200 clients in eight markets. With the money, Paypercut will complete its e-money license in Ireland, launch new products and expand the network of stablecoin corridors for cross-border payments in the region. With the new investment, Paypercut’s total funding reaches €7 million, after attracting €2 million in July 2025 to develop an aggregator for BNPL (Buy Now, Pay Later), and later a complete payments platform. During this period, Paypercut managed to grow and already serves over 200 merchants in eight markets in the region and plans to increase their number tenfold by the end of the year. And according to its founders, the fresh 5 million euros of capital will be enough to develop more products and become profitable within the next 12 months.

Two public companies will soon leave the Bulgarian Stock Exchange. At the end of May, the Financial Supervision Commission approved the documents for a tender offer to buy out the shares of the minority shareholders in Momina Krepost AD and Aroma AD. The Financial Supervision Commission authorized the publication of a tender offer by Medical Supplies OOD - Sofia to purchase, through the investment intermediary Sofia International Securities AD, 169,109 shares, representing 9.999% of the capital of Momina Krepost AD, from the remaining shareholders of the company. The tender offeror directly owns 888,467 registered, dematerialized shares, representing 52.54 percent of the capital and votes in the general meeting of shareholders of the company for the production, trade and re-export of disposable medical devices and goods for industry and household use. As a shareholder, he has concluded an agreement on a common policy for the management of Momina Krepost through the joint exercise of the voting rights held with Sopharma AD, which owns 633,608 shares or 37.47 percent of its capital. This means a total package of 1,522,075 shares, representing 90.001 percent of the capital of Momina Krepost AD. Medical Supplies offers to purchase the shares of the remaining shareholders in Momina Krepost at EUR 0.98 per share. The tender offeror will finance the purchase of the shares from the remaining shareholders with borrowed funds from Sopharma in the total amount of EUR 165,726.82. Medical Supplies' plans include terminating the status of a public company of Momina Krepost AD and delisting its shares from trading on the Bulgarian Stock Exchange. All the shares of the Veliko Tarnovo company are of one class and are traded on the Bulgarian Stock Exchange, BaSE Alternative Market, equity segment. Permission to publish an adjusted tender offer was also received by Harisson Management Limited, Republic of Malta. The company wants to buy back through investment intermediary Elana Trading AD a total of 551,791 shares or 3.562% of the capital of Aroma AD – Sofia, from the remaining shareholders of the perfume and cosmetics production company. Offered price per share: EUR 0.95. If the Maltese company buys back all shares with voting rights in the general meeting of shareholders of Aroma AD, it may submit an application for delisting from the register of public companies kept by the Financial Supervision Commission and the shares of the cosmetics company will cease to be traded on the Bulgarian Stock Exchange.

The economic shock from the war with Iran is hitting European factories harder, dampening demand for their goods and driving up raw material costs. This is happening at the fastest pace in four years, Reuters reports. Meanwhile, Asian rivals saw activity expand ahead of May. The US-Israeli conflict with Iran, which began in late February, has literally shaken trade and financial markets, raising concerns about global energy supplies, especially through the Strait of Hormuz - a key route for oil and gas supplies. The worrying data comes after the heads of the International Energy Agency (IEA), the International Monetary Fund (IMF), the World Bank and the World Trade Organization (WTO) have already warned that the war is straining global energy supplies. The S&P Global PMI for manufacturing in the eurozone fell to 51.6 in May from a near four-year high of 52.2 in April, but above the preliminary estimate of 51.4. A reading above 50.0 indicates growth. In Germany, Europe’s largest economy, manufacturing activity has stagnated, while French factories contracted for the first time since November. The European Central Bank will raise its deposit rate this month and at least once more this year to try to stop higher energy prices from weighing on underlying inflation, a majority of economists polled by Reuters in May said. New official data showed inflation had risen further above the ECB’s 2% target since last month. British factories raised prices at the fastest pace since June 2022 last month in response to big cost increases. Despite the global crisis, factory activity is expanding in most Asian economies. China's private sector index rose for a sixth straight month, while South Korea's rose at its fastest pace in five years, underscoring the region's drive to build up so-called buffers against potential disruptions caused by conflict. The RatingDog China manufacturing PMI, compiled by S&P Global, fell to 51.8 in May from 52.2 in April, but was slightly better than analysts' forecast of 51.6. The result contrasted with an official survey showing that factory activity in the world's second-largest economy stalled last month as new orders shrank and input costs continued to rise. Factory activity in Japan also expanded, with the PMI reaching 54.5 in May, slowing from an April peak of 55.1 in more than four years, even as firms there reported the sharpest rise in input costs since September 2022 due to higher raw material prices. South Korea’s PMI rose to its highest level since March 2021, reaching 54.8 in May, up from 53.6, again underscoring companies’ drive to lock in supplies. In Vietnam, the PMI for factories rose to 52.8 from 50.5, while Taiwan’s rose to 56.1 from 55.3, surveys showed. The Philippines’ index jumped to 50.8 from 48.3.

The European Bank for Reconstruction and Development (EBRD) has lowered its forecast for economic growth in the countries around the world in which it invests this year. The financial institution indicated that the sharp rise in energy prices caused by the war in the Middle East has affected Europe more than the United States. This is highlighted in the bank’s latest report on the global economic outlook. The EBRD expects overall economic growth for the regions around the world in which it invests, covering more than 35 countries, to slow to 3.1 percent in 2026, compared to growth of 3.4 percent in the previous year. This represents a decrease of 0.5 percentage points compared to the forecast published in February, when the financial institution announced that it expected growth of 3.6 percent this year. The EBRD left its economic growth forecast for Bulgaria unchanged. The bank predicts economic growth of 2.7 percent, which coincides with the previous forecast. The most significant is the downgrade of the forecast for the Southern and Eastern Mediterranean region, which includes Egypt, Iraq, Jordan, Morocco, Tunisia and Lebanon, where Israel is stepping up its operations against the Iranian-backed Hezbollah group. For Lebanon, the EBRD now expects the economy to contract by 2 percent this year, while in February it predicted growth of 4 percent. The institution foresees a recovery in economic activity next year, “provided that peace is restored.” The bank cites the rising prices of oil and natural gas, disruptions in maritime transport through the Strait of Hormuz, as well as the growing difference in energy costs between Europe and the United States as the main factors for the deterioration of the outlook. According to the EBRD, the price of natural gas in Europe is already more than five times higher than in the United States. Europe, which is more dependent on imported energy products, is additionally burdened by electricity prices, which remain significantly higher than in the United States and put energy-intensive industries at a disadvantage, the bank also notes. The EBRD also points out that inflation in all regions in which it invests, which had slowed at the end of 2025, has reversed its trajectory this year, driven mainly by rising energy and food prices.

According to statistics from the Air Logistics Department of the China Federation of Logistics and Supply Chain, as of May 31 this year, a total of 80 new international air cargo routes have been opened in the country, with the weekly number of two-way flights increasing by more than 180. In terms of route structure, 35 are to Europe, 33 to Asia, 10 to North America, 1 to South America and 1 to Africa. The cargo structure is dominated by cross-border e-commerce goods, high-tech industries with high added value and fresh produce. The continuous increase in international air cargo routes not only ensures smooth global logistics channels and stabilizes production and supply chains, but also promotes the export of Chinese goods.