site.btaTourist Municipalities, Mostly Southern Coastal Ones, Are Heaviest Hit by COVID Crisis - Study

The impact of the crisis is far from distributed equally in the different parts of Bulgaria. Industrial centres mostly passed through a temporary shock, then quickly recuperated after the strictest restrictions were lifted and international trade resumed in the summer and autumn of 2020. The tourism-oriented municipalities, though, particularly those along the southern Black Sea coast, were worst hit and local economies are taking much longer to recover, a study of the Institute for Market Economics titled “The COVID-19 Crisis and Municipalities” released on Wednesday shows. Sofia continues its economic expansion, mostly driven by the growth in the crisis-untouched ICT sector and construction.

The study analyses the consequences of the 2020 economic crisis in Bulgaria’s 265 municipalities based on value added, exports, investments, unemployment and employment, and migration data.

In spite of the general decline of the national economy, increased value added in 2020 was established in 148, or more than half of the municipalities in Bulgaria. The capital and other industrial regions showed continuing growth in 2020, while economic activity slowed down considerably in regions with highly developed tourism.

Investments revealed opposite trends in the different groups of municipalities. In spite of the crisis, foreign direct investments on an accrual basis grew. This process, though, was mostly driven by the influx of foreign capital in Sofia and some other regional centres like Vratsa, Pernik and Pleven, the experts comment.

Unemployment increased generally across the country, albeit limited to under 2.0 per cent, with only 20 municipalities registering a decline in 2020. Demand for workforce began quickly to resume in 2021 and unemployment shrank in nearly all municipalities (231 out of 265)./PP/BR