Dr. Maria Hristova and Viktor Goussev attended the presentation of the Institute for Market Economics’ Alternative Budget
Fiscal stability, predictable taxation and favourable conditions for long-term investment are mutually reinforcing foundations of sustainable economic growth. These considerations are particularly relevant to the preparation of Bulgaria’s 2027 state budget and the need for policies that safeguard public finances while preserving the competitiveness of the Bulgarian economy.
Dr. Maria Hristova, CEO of Invest Sofia, and Viktor Goussev, Head of Investment Analysis, attended the forum “Alternative Budget: Breaking the Cycle of Deficits”, organised by the Institute for Market Economics (IME) in Sofia on 3 November.
In its Alternative Budget 2027, IME proposed limiting public expenditure to 38% of gross domestic product, optimising public-sector employment and expanding opportunities for private investment. According to the Institute’s analysis, bringing persistent budget deficits under control requires structural reforms and greater efficiency in public spending rather than further increases in the tax burden.
From an investment policy perspective, the sustainability of public finances is closely linked to business confidence and long-term investment decisions. Investors assess not only prevailing tax rates and operating costs but also regulatory predictability, the quality of public services, access to skilled labour and opportunities for business expansion.
For Invest Sofia, particular importance is attached to creating conditions that encourage companies already operating in Bulgaria to continue investing, expand their productive capacity and create new jobs.
Reinvested earnings represent a significant component of foreign direct investment and an important indicator of the long-term commitment of established investors. They reflect earnings retained within companies rather than distributed to their owners. Policies aimed at attracting new capital should therefore be accompanied by consistent measures to retain existing investors and support their further development.
Against this background, Invest Sofia has identified the promotion of reinvestment as one of its strategic priorities for 2027. Alongside attracting international companies, the Agency is working to improve investment facilitation, strengthen cooperation between businesses and public institutions, and expand access to specialised expertise and business partnerships.
During the forum, IME economists Lachezar Bogdanov and Petar Ganev outlined the principal challenges facing fiscal policy and potential approaches to reducing budget deficits. The discussions also addressed reforms in key public systems, including healthcare and the judiciary, presented by Petya Georgieva and Ivan Bregov, respectively.
Sofia’s investment competitiveness depends on public policies that provide a predictable planning horizon, efficient administration and high-quality infrastructure. Fiscal sustainability and investment promotion should not be regarded as competing objectives, but as complementary elements of a coherent long-term economic strategy.
