Bulgarian business is riding a wave of momentum in the second quarter of 2025, with newly established companies growing by 7.3% - a pace faster than the EU average of 4.6%. According to Eurostat’s latest figures, Bulgaria is emerging as an increasingly dynamic player on the European entrepreneurial map. Yet, alongside this boom, the country also faces warning signs: bankruptcies in several sectors have risen, reminding that optimism is tempered by real risks.

New business registrations on the rise

Between April and June 2025, Bulgaria recorded a 7.3% increase in newly registered companies compared to the first quarter, when there was a decline of 2.7%. The jump reflects revived confidence, most visible in information technology, transport, and services. Sofia and Plovdiv remain the engines of startup activity, boosted by EU funding and digitalization initiatives. Bulgaria’s technology sector, in particular, continues to draw young entrepreneurs with its relatively low labor costs and strong demand for IT solutions.

Across the EU, new business registrations grew by 4.6% after a 5.5% drop in the previous quarter. Transport led with an increase of 13.1%, followed by ICT (8.2%) and financial services (5.2%), while industry remained unchanged. The Netherlands (+57.7%), Spain (+27.6%), and Romania (+19%) posted the largest gains, whereas Denmark (-18.2%), Cyprus (-8.4%), and Germany (-6.2%) registered declines. Bulgaria’s 7.3% growth positions it firmly among the more resilient economies in Central and Eastern Europe, pointing to a stronger recovery trend.

Bankruptcies highlight sectoral pressures

Alongside this rise in new companies, Bulgaria also saw a 7.7% increase in bankruptcies during the second quarter, following a 5.8% drop at the start of the year. Construction emerged as one of the hardest-hit sectors, pressured by high building material costs and delays in infrastructure projects. The IT industry also registered more bankruptcies, reflecting both intense competition and rapid shifts in technology. In contrast, retail and tourism remained relatively stable, helped by stronger consumer demand and a rebound in visitor numbers.

At the European level, bankruptcies grew modestly by 1.7% compared to the first quarter (when there was a 0.3% decrease). ICT (+13.6%) and construction (+8.1%) accounted for most of the increase, while hospitality (-7.5%) and trade (-3.7%) showed improvement. Latvia (+70.7%), Cyprus (+66.8%), and Slovakia (+20.1%) recorded the sharpest increases, while Estonia (-28.7%), Spain (-8.3%), and Sweden (-8.1%) saw significant declines. Bulgaria’s 7.7% jump in bankruptcies, well above the EU average, points to vulnerabilities in key sectors that will require targeted support if the growth momentum is to be sustained.