The depopulation of Northwestern Bulgaria, which was officially declared the poorest region in the EU, has started to affect many districts of the Central North and Northeastern Bulgaria such as Razgrad, Silistra and Lovech, the latest research of the Institute for Market Economics reads. Soon, due to the expected demographic collapse some towns will not be able to meet the requirements, in order to continue functioning as district centers.

According to Yavor Alexiev who works as economy expert at the Institute for Market Economics, these processes are natural and are stemming from the change of the business model. Similar processes of depopulation can be seen in other EU member states as well.

“Most of the rural population has naturally migrated to the cities, as the labor demand in the agriculture field has been low in the beginning of the 21^st century. The wrong regional policy in Bulgaria is among the main reasons behind the widening gap between Sofia and the rest of the country, as well as between the Northern and Southern Bulgaria.”

The gradual depopulation of the Bulgarian villages and of many Bulgarian districts is a result of a series of problems, which have remained unsolved over the years.

On one hand, it was caused by the economic situation. The lack of jobs and investments (both local and foreign) forces some of the rural population to move to the cities, where people can find better living and working conditions. On the other hand, the companies struggle to find highly-qualified personnel and investments are rare in these parts. Thus, the Northern and Central Bulgarian regions enter into a vicious circle which results in higher and permanent unemployment, unlike the southern part of the country which marked an economic recovery in 2014. However, in seven districts situated north of the Balkan Mountain Range (Shumen, Razgrad, Silisltra, Targovishte, Lovech, Vidin and Montana) the employment rates remain under 40% for the second consecutive year.

The lack of jobs and the low competition between the employers place the companies in dominant position at the labor market and boost shadow economy. The households’ incomes, 40% of which are formed by salaries, remain low, which results in low consumption. Due to the unfavorable business environment, most people who live in these underdeveloped Bulgarian regions prefer to earn their money through small swindles, instead of working or doing business.

Yavor Alexiev notes that the poorly developed infrastructure in Central and Northern Bulgaria further worsens the economic picture.

“The problem is that most of the main infrastructure projects in the road and the railway construction field have been fulfilled in the Southern parts of the country over the recent years and everyone can see the results there. Unfortunately, most large infrastructure projects in Northern Bulgaria are either isolated, or pointless. For instance the Danube Bridge 2 near the city of Vidin (Northwestern Bulgaria) is a good facility. However, the access to the bridge is very hard. ”

All governments who have been in charge of this country over the recent years are to blame for the situation due to their wrong priorities in the infrastructure construction field, Mr Alexiev went on to say. Moreover, the wrong strategy in the country’s regional development is accompanied with the distribution of the financial resource on a party principle.

“The budget of the municipalities is based on administrative principle. The link between the local taxation and political representation was cut. It weakens the local democracy and as a result the local community degrades. Currently the municipalities mainly receive funds from the state budget through the so-called Regional Fund, which usually happens on a party principle. The state subsidy must be kept in the small settlements only”, Yavor Alexiev contends.

English version: Kostadin Atanasov