site.btaNew US Tariffs Not Expected to Have Significant Effect on Bulgarian Economy

The new US trade tariffs are not expected to have a significant negative effect on the Bulgarian economy, and if there is one, it will be felt by businesses in Bulgaria with a slight delay, according to the spring macroeconomic review of DSK Bank.

According to the bank's analysis, the Bulgarian economy is demonstrating sustained growth despite the uncertainty.

The effects of the new US tariffs will be indirect because Bulgaria does not have a large trade with the US, at 2-3% of all exports. The negative effects are related to Bulgaria's trading partners in Germany and Italy, which are on the list of "victims" of the tariffs. The automotive industry and mechanical engineering are the sectors expected to be affected by the US tariffs. According to the analysis, the positive aspect of this turbulent situation is the opportunity that opens up for the trade of the European Union and Bulgaria to broaden their geographical outlook.

The Bank says that in the past year the Bulgarian economy demonstrated stronger economic growth, which is one of the highest among the EU member states. As a result, convergence with the European average continues, although conditions allow for a faster "closing of the gap". By the end of 2024, the Bulgarian economy is growing at 4.1% compared to 1.2% for the euro area.