site.btaBulgaria's Grey Economy Makes Up around 34.6% of GDP in 2023 - Survey

The grey economy in Bulgaria makes up around 34.6% of this country’s gross domestic product (GDP), according to data for 2023 from a survey commissioned by Visa Bulgaria and conducted by the global management consulting firm Kearney. This places Bulgaria at the top among EU Member States in terms of the size of its informal economy.

The survey, presented here on Tuesday, reveals that the informal economy is most prevalent in the hospitality sector (70%), followed by agriculture, forestry and fishing (66%), arts, entertainment and sports (58%), construction (56%), wholesale and retail (53%), and manufacturing (49%). Wholesale and retail trade (BGN 14.2 billion) and industrial production (BGN 13.6 billion) are the biggest contributors to the informal economy.

The survey highlights the positive impact of digitization in curbing the informal sector and stimulating economic growth. The findings suggest that a 5% annual increase in digital payments over five years in Bulgaria could reduce the size of the informal economy by 1% each year. This could increase GDP by BGN 1.9 billion annually and bring in an additional BGN 0.6 billion in tax revenue each year, Konrad Slusarczyk, Director of Government Engagement for Central and Eastern Europe at Visa Europe, said during Tuesday’s presentation.

Data show that Bulgarians make an average of 124 digital payments per person per year, which is less than one-third of the EU average.