Bulgaria shifts from EU funding to private capital for key public investments

Sofia: Bulgaria is preparing to replace EU cohesion funds with private investments and long-term concessions for rebuilding its critical public infrastructure, PM Rosen Zhelyazkov announced on Wednesday, citing the need for financial and strategic partners in the country’s future infrastructure development.

Over the past 18 years, Bulgaria has been a major beneficiary of EU cohesion and structural funds, receiving over €25 billion to modernise roads, railways, water infrastructure and energy networks.

However, with the 2021–2027 EU budget cycle narrowing, and no guarantee of similar levels of funding beyond 2027, Sofia is now seeking alternative investment mechanisms.

According to Zhelyazkov, the government is unwilling to raise taxes to increase state budget spending, leaving two main options: increased redistribution of GDP which has been ruled out or a turn to private capital.

The Prime Minister emphasised that large-scale investments will increasingly rely on private involvement over the next 30–40 years.

Transport Minister Grozdan Karadzhov has long advocated for developing infrastructure, including roads, rail, utilities and energy, through public-private partnerships.

On Wednesday, the Council of Ministers mandated that each ministry identify by 16 June three major unfunded projects that could be implemented via concessions. Ministries must assess each project’s eligibility using a methodology set by the Concession Coordination Council.

These projects will form part of the National Action Plan for State Concessions, in line with the government’s declared policy of expanding the use of public-private partnerships under the Concessions Act.

Currently, several major concessions operate at Sofia, Varna and Burgas airports, several sea ports, the Sofia water network and a large share of mining operations. The new plan suggests an expansion into road construction and other public services, marking a strategic pivot in Bulgaria’s investment policy.