University of Arkansas, Fayetteville


This paper examines the factors that favor Foreign Direct Investment ( FDI) in Bulgaria and recommends public policy changes that will enhance the international competitiveness of Bulgaria. Four factors that favor an increase in FDI in Bulgaria are clearly identified. First, although the economic environment is considered challenging compared to other countries in the region, Bulgaria enjoys political stability. Second, Bulgaria offers a low-cost, well-educated labor pool, although additional public investments in foreign language training may be needed. Third, there are investment opportunities for infrastructure development through privatization in the areas of energy, information technology (IT), and transportation. Bulgaria is searching for significant partners in the renovation of the nuclear power plant in Kozlodui, IT improvements, and Build Operate Transfer( BOT) projects for the reconstruction of major highways and transportation hubs. last but not least, Bulgaria is geographically well situated and has the potential to be an attractive tourist destination.