site.btaReceding Danube Could Pose Economic Risk to Bulgaria, Insurer Coface Warns

If low water levels on the Danube persist only until autumn 2026, the impact on Bulgaria's GDP will be limited but noticeable in the transport, agriculture and energy sectors, according to an analysis by insurer Coface Bulgaria received by BTA on Tuesday.

Low water levels on the Rhine and Danube are creating risks for economies across Europe.

"If low water levels persist only until autumn 2026, the impact on Bulgaria’s GDP is likely to be limited, but noticeable in transport, agriculture and energy. However, if similar conditions recur every year, the Danube could turn from a competitive advantage into a structural economic and trade risk for Northern Bulgaria and the national economy as a whole," said Plamen Dimitrov, Managing Director of Coface Bulgaria, as quoted in the press release.

Coface cited data from Bulgaria's Executive Agency for Exploration and Maintenance of the Danube River showing that water levels along the Bulgarian section remained critically low in August 2026. Restrictions on vessel draught were imposed along the entire river, while vessels were waiting to pass through the most critical sections around Belene and Batin. This is creating difficulties for exports and imports through Danube ports, including Ruse, Lom, Vidin and Svishtov, because of vessels' reduced cargo capacity, the company said. It added that the main sectors in Bulgaria benefiting from low-cost river transport include agricultural products – particularly grain – and fertilizers, construction and metallurgy.

Coface said restrictions at the Paks Nuclear Power Plant in Hungary and the Cernavodă Nuclear Power Plant in Romania are forcing the region to rely on more expensive sources of electricity and increased imports. The resulting price pressure is spreading to neighbouring markets, including Bulgaria. So far, Bulgaria has been in a better position because the Kozloduy Nuclear Power Plant continues to operate thanks to a specially constructed water channel for cooling. Nevertheless, prices on regional power exchanges are rising. Bulgaria’s electricity exports are expected to increase, according to the company, with some of the pressure from the regional shortage continuing to be transferred to the Bulgarian power system.

The authors of the study examine the effects of record-low water levels in the Rhine and Danube, noting that they are causing disruptions to transport and energy supplies, negatively affecting the European economy. Low water levels are likely to persist, with risks expected to remain high, Coface Bulgaria forecasts.

The company said significant increases in water levels on either river are not expected in the short term. On the Danube, levels recovered somewhat after the historic lows recorded earlier this month in Hungary, but they continue to fall in the lower part of the basin, particularly in Romania. According to Romania’s National Institute of Hydrology and Water Management, water levels are expected to remain almost unchanged at least until August 25, which is the current forecast horizon. In the coming weeks, government measures to raise water levels around nuclear power plants – including by submerging barges or altering the river’s flow – are expected to provide some relief.

Water levels on the Rhine are still falling. In addition, the Rhine normally experiences a seasonal period of low water between September and November, suggesting that the challenges could continue for several months. In the longer term, as snow cover decreases and glaciers continue to shrink, while heatwaves become more frequent, periods of low water are likely to become more frequent and severe, Coface forecasts.