site.btaIncoming Tourism to Bulgaria from Ukraine will Be Hit Worst by Conflict – Expert

Incoming tourism to Bulgaria from Ukraine will suffer the most from the conflict in Ukraine but on micro-level a lot of serious shocks should be expected for companies whose business is connected with Ukraine, Vesselin Iliev, head of International Economic Cooperation with the Bulgarian Industrial Association (BIA) said Thursday as quoted by BIA.

The Russia – Ukraine conflict is escalating as we speak and it is hard to predict how far it will go and what exactly its aftermath for the economy will be, he said.

Iliev does not expect commodity goods such as fertilizers to be considerably effected. “Some niche products in the Bulgarian export will likely suffer: pharmaceuticals, household electronics including water heaters, which are the 6th or 7th key commodity in Bulgaria’s export to Ukraine, most investment goods, coca products, perfumery and cosmetics, video games. Even though it is outside the scope of this statistics, it can be expected that the export of special products will increase.”

He said that imports from Ukraine to Bulgaria are strongly dominated by raw materials and commodities and their production and availability on the market will be hit by the conflict. Importers in Bulgaria can find alternative suppliers but there is sure to be a dramatic increase in prices.

There is a considerable threat for the availability of spare parts for Ukrainian equipment, including building and mining machines. Also, about half of the pellets for heating in Bulgaria come from Ukraine and if that export contracts, prices on the Bulgarian market will go even further up.

Bulgarian export to Ukraine traditionally varies between 250 and 350 million euro a year, going up to 400 million in 2021, according to BIA. Bulgaria mostly exports fertilizers, pharmaceuticals, machines and electrical equipment. The Ukrainian import to Bulgaria is traditionally around 500-600 million euro a year but soared to over 800 million in 2021.   It is dominated by semi-finished goods from iron and non-alloy steel, sunflower and ammonia. Tourists from Ukraine to Bulgaria numbered 300,000 to 500,000 per year in the pre-pandemic period. Mutual investments are scarce.