site.btaMedia Review: May 8

DEMOGRAPHIC TRENDS, INTERNAL MIGRATION IN 2024

In 2024, of the six largest cities with population over 100,000 in the country, only four increased their population, 24 Chasa writes in an analysis.

These are Sofia, Plovdiv, Varna and Burgas, while Ruse and Stara Zagora began to lose inhabitants, according to recent data of the National Statistical Institute.

Another visible trend is that Bulgarians seem to have started migrating from the interior of the country to the Black Sea coast and nearly everywhere there is a mechanical population growth.

Nessebar placed at the top, as it increased the number of its residents by as much as 11% in 2024.

“In the capital, the population grew by nearly 8,000 people in one year, and in Plovdiv and Varna the increase was by 4,000 people. The population grows fastest, where there are the most job vacancies, well-paid jobs, and career opportunities. Also higher education establishments are concentrated in these cities", Adrian Nikolov of the Institute for Market Economics said.

Back in 2011 during the previous census only Sofia had a population comparable to today. All other major cities have declined.

The reason is that in the long run the impact of negative natural growth is more clearly felt, and especially of high mortality. In general, in Bulgaria, as in many EU countries, there has long been no natural increase in population. In general, the number of people is increasing, but this is due to mechanical growth - migrants from outside and people moving from one place to another. In the case of Bulgaria – of the movement of people from smaller and more backward municipalities to larger and wealthier ones.

"The positive migration of the last few years is still not large enough, to overcome the impact of the previous two decades.  However, if we look at just the largest cities in isolation from the rest of the country, the demographic picture is far from discouraging.

Migration is positive, natural increase is gradually moving towards balance, especially after the peak in mortality during the COVID-19 pandemic,” Nikolov stressed.

Internal migration in Bulgaria is predominantly from small municipalities to larger ones. In contrast to 2020-2021, the population of large urban municipalities is growing at the expense of a number of small municipalities, especially along the border and the Danube region.  There's a link between economic development and negative net migration.

The solutions to this must be sought in fiscal decentralization and in empowering local authorities for bold and unconventional investment policies, according to Nikolov.

"The general conclusion that northern Bulgaria faces more serious demographic challenges than southern is correct, but in practice such a view across planning areas is not particularly informative, especially if you take into account that there is going to be a redivision soon," said Nikolov. There are regions in the south - along the border with Serbia, and in some parts of the Rhodope Mountains, which are also experiencing rapid population decline and even faster aging.

The economic consequences are obvious - where there is no young and trained population, with the right skills and education, it is very difficult to make investments.

INTERNATIONAL MIGRATION

Dnevnik.bg writes that for the fifth consecutive year, the number of those immigrants in Bulgaria exceeded the number of those who departed. The trend started in the pandemic year 2020, when about 24,000 Bulgarians returned. Now, however, the situation is quite different - for the third year in a row most of the newcomers are foreign citizens.

Half of those who settled in Bulgaria are foreigners from outside the European Union - mainly Turkey (21.8%), Ukraine (16.6%) and Syria (10.5%). Just under 15% are from EU member states. In total, 33,984 foreign nationals settled in Bulgaria. Of these 7116 were from EU countries and 26,868 were from non-EU countries. The number of Bulgarians returning to their home country in 2024 was nearly 18,000 or about 1,000 more than the number of those who returned a year earlier. 

At the same time, the number of Bulgarians who left the country fell to around 9,000, the lowest figure for the past decade except for 2020. As expected, a reference by age shows that Bulgarians returning to their homeland are usually older, while those who left the country are mainly between 20 and 34 years old.

VAT TAX COLLECTION RATE IN Q1

TrudNews.bg writes that VAT revenues are falling short of projections, although they are up significantly compared to last year, referring to data of the Finance Ministry. As at the end of March, VAT revenues amounted to BGN 4.74 billion, which is 19.1% of the annual projections.

There is a chance to make up for the shortfall by the end of the year, but this can only happen with very serious efforts of the revenue agencies. Last year at the end of March, VAT revenues were at 21.5% of the plans and at the end of December remained just below the projections. But now the shortfall is bigger. The reason is in the increase in VAT revenue projections by more than 33% compared to last year, set out in the budget.

At the end of March, VAT revenues grew by BGN 740.7 million (+18.5%) compared to last year, as a result of both higher revenues from domestic transactions and imports. VAT receipts from non-EU imports stood at BGN 1.568 billion at the end of March, up by 11.2% (+ BGN 157.7 million) compared to the same period last year. The increase was most significant in imports of transport equipment and consumer goods, food and beverages. VAT revenues from domestic transactions and supplies from EU countries amounted to BGN 3.175 billion, up by BGN 583 million or 22.5 per cent year-on-year.

The ministry also announced preliminary data on the implementation of the budget at the end of April. In four months the deficit is BGN 1.9 billion. The BNB's contribution to the state budget in April amounted to BGN 550 million.

JOBS IN APRIL

TrudNews.bg writes that job postings in April were down 9%, or 4,000 fewer than the same month last year, according to a jobs site. There was also a drop in demand for new employees compared with the previous month. In some sectors, the fall in demand for workers was 16%

The largest decreases in job openings from last year were in the accounting, auditing, finance (-16%) and marketing and advertising (-16%). The decrease in demand for jobs in IT continued, at 10%. There are also fewer job advertisements in administrative activities, construction, healthcare and hospitality. Jobs increased in ;logistics and transport (+0.5%) and sales and marketing (+4%).

Most new hires were in trade and sales, which accounted for 26% of the jobs, followed by hotels and restaurants (18%), and manufacturing (16%).

Sofia had the highest number of job postings - 37%, followed by Plovdiv (9%), Varna (9%), Burgas (5%), Ruse (3%) and Stara Zagora (2%).

LOCAL GOVERNMENT

Speaking on Bulgarian National Radio, Silvia Georgieva, Executive Director of the National Association of Municipalities in Bulgaria said that this year municipalities will receive nearly BGN 9 billion in state budget subsidies and transfers. This is an increase of 13.6% and this growth will mainly go to compensate for the increase in the minimum wage.

She specified that almost 60% of the BGN 9 billion (BGN 5.4 billion) are funds for education - these are teachers' salaries.

"The amount seems impressive, but we cannot dispose of almost 60% of it," Georgieva stressed.

She added that the procedure for adopting municipal budgets is currently underway:

"They must be submitted by the mayors to the municipal councils within 25 calendar days after the adoption of the state budget. The debates of municipal budgets by the municipal councils and their adoption is currently underway. In most of the municipalities the budgets have already been adopted. The deadline for the adoption of municipal budgets is May 21. Almost no municipalities will postpone the deadline. It is crucial to adopt the municipal budgets, as their adoption is a condition to start paying for capital expenditure that we have been holding back since the beginning of the year."

The investment programme for municipalities continues with Budget 2025, it has not been terminated and our concerns have been allayed, Georgieva said.

"Our projects are set in the state budget. There are already 3,100 projects worth BGN 7.2 billion. Some BGN 1.650 billion have been allocated for payments for the current year"

However, there have been no payments under the investment programme since the beginning of the year. The last payments were made on December 30 2024.

The situation is identical in terms of disbursements under the National Recovery and Resilience Plan, warned Georgieva.

Currently, municipalities have 1,300 projects worth BGN 2.5 billion underway. All of these projects have been agreed, most of the procurement has been carried out, construction is underway. We have been paid only 10% towards our projects, which is about BGN 260 million. 

AI REGULATIONS

TrudNews.bg writes that the Confederation of Independent Trade Unions in Bulgaria (CITUB) is proposing regulations for AI.

The International Labour Organization has published a report that reveals how AI, digitalization and automation are transforming working environments around the world.

"Recent research indicates that over 80% of employers use AI, which covers over 470 million workers. Fear hasn’t taken over yet because things are more in the realm of how interesting it is. But the trade unions are not so fascinated, because AI has started to hire and fire people," said CITUB Vice President Ognyan Atanasov.

Artificial intelligence makes the selection - whether the candidate is eligible or not, he clarified.

"Until we see regulations and that a human is in control of this whole process, we can't help but react strongly. Workers react because it enters their space through constant monitoring," Atanasov explained. He was adamant that mentally, AI is having a strong impact on people and creating so-called techno stress.