Bulgaria – Small and Medium-Sized Businesses
It is far from a secret to any economist, accountant or ordinary person that Bulgaria’s economy was built on the ground of the small and medium-sized businesses’ activity. That is the very “heart” of the fragile market economy which generated considerable experience and its own resistant powers in the last few years.
Role of the small and medium-sized businesses
The small and medium-sized businesses developed at a remarkable speed in the transition period reaching enormous share of contribution to Bulgaria’s economic boom. Thanks to that a great number of jobs were created and the local economy was constantly growing through the years.
The investments made in such types of businesses play an essential part in the local people’s living standard increase as well as the accomplishment of considerable progress in the catching-up process of Bulgaria in comparison with the rest EU member states.
How did the crisis affect the small and medium-sized businesses?
Unfortunately, at the peak of small and medium-sized businesses crediting and development, when the realization of practically working successful investment projects in this business segment was extremely easy, the world economic and financial crisis started affecting progressively the economy. Its negative impact manifested itself first in the speed and size of banking credits approval – the requirements for new bank credits became rather tough to most businessmen with innovative and barely realized business projects and ideas.
All this invariably resulted in the serious decrease of Bulgarian entrepreneurs’ interest in new investments. And the large-sized business turned out to be not that well-prepared to fill in the gap left from the lack of small and medium-sized investment projects.
And what will happen now?
The newly formed Bulgarian government took office with the promise to take special care of the small and medium-sized businesses recovery process. A series of new laws were introduced aiming at easing the business-making procedures. Many pending payable transactions to private companies were paid-off. All this already started improving the local business climate which seems to be in the process of re-boot. Time will show if Bulgarian small and medium-sized businesses will manage to restore the positions lost in the last few years, thereby increasing the future business investments of that type. Chances for this to happen do exist and if so, this could help the overall resurrection of the country’s economy.