Our View: We expect Bulgaria’s defence budget to continue decreasing in absolute terms for the next two
years, as the economy continues to struggle to recover from the global financial crisis. Although spending
will increase again starting in 2017, the share of defence spending as part of the GDP will continue to
decrease and government efforts to develop the domestic industry will take a long time to bear some fruits.
As such, the number of opportunities for national and international companies seeking to enter the
Bulgarian defence market will remain limited in the next five years.
In 2009, the Bulgarian Defence White Paper recognised the failure of the government to respond to the
priorities set up by the first White Paper published in 2002, and elaborated a strategy to improve both the
state of the domestic defence sector and the efficiency of the armed forces. More specifically, the White
Paper acknowledged that whilst the domestic defence sector could provide for the armed forces needs in
technologies and ammunitions, it was significantly lagging behind in its ability to provide the capabilities
necessary for the modernisation of the armed forces. The armed forces, it argued, had for too long proved
too expensive to the government, showing however little efficiency and effectiveness.