AGP Executive Report

Food Pricing Watch: Bulgaria’s Economy Ministry launches a public consultation on a “fair value” methodology for essential foods, using local production costs plus EU price parity, aiming for transparency without administratively setting prices. AI & Industry Capacity: President Iliana Iotova highlights Bulgaria’s AI momentum after Schwarz Digits plans a major data centre and the country’s selection for an EU AI gigafactory. Agriculture Support Pressure: Agriculture Minister Plamen Abrovski asks the European Commission for exceptional support for cow’s milk and fattened pig producers as purchase prices fail to cover costs. Drugs Crackdown: Bulgarian authorities dismantle a fentanyl lab in Sofia’s Fakulteta, seizing over 12.5 kg of fentanyl and tracing a network supplying the country; materials will be shared with US agencies. R&D Funding Boost: Eurostat data show EU public R&D budgets up 60%+ over a decade; Bulgaria’s per-capita growth is the highest in the bloc (+495.5% to EUR 92.3). Danube Disruption: Record-low Danube levels keep navigation severely hampered and threaten operations tied to cooling water, while archaeologists document Constantine’s Bridge foundations. Energy & Finance: From 9 August, Bulgaria ends dual lev/euro pricing for FSC-supervised financial services, moving to euro-only display. Local Industry Signals: Business services production in Bulgaria stays steady month-on-month but rises 8.1% year-on-year, with growth in IT, professional services and accommodation/food.

Heat & Wildfire Response: Italy issued the highest heat alert for all major cities while Hungary switched off lights at landmarks to save energy; Bulgaria also faced wildfire disruption with the Trakia highway closed as flames spread near Sofia. Energy & Power Risks: Drought is cutting cooling water access across Europe, forcing lower output or shutdowns at power plants and pushing electricity prices up; the Danube’s record-low levels are also raising nuclear and grid stress concerns. Danube Shipping & Infrastructure: Low Danube water is restricting navigation, stranding vessels and exposing historic sites, while governments race to manage electricity and transport impacts. Bulgaria’s Industrial Pulse: Bulgaria topped the EU in industrial price growth, with manufacturing still posting solid but slower growth (8.8%); key price rises were seen in basic metals and chemicals. Space & Defence Industrial Policy: Bulgaria plans a major space centre at the former Dobroslavtsi airfield, aiming for earth observation, satellite production and a tech industrial park. Drugs Enforcement: Ukrainian and Bulgarian police dismantled an international fentanyl/psychotropic network, shutting a clandestine lab and detaining suspects. Transport Connectivity (Corridor 8): Albania opened a new section of Corridor 8, strengthening the Adriatic–Black Sea logistics link that connects to Bulgarian ports. Local Investment & Transport Upgrade: Sofia Municipality is preparing up to EUR 367m in long-term financing to modernize public transport and key infrastructure.

Heat & Wildfire Response: Italy issued its highest heat alert for major cities while Hungary switched off lights at landmarks to save energy as Europe’s heatwave and wildfires keep escalating; Bulgaria saw major fire impacts including the Trakia highway closure near Sofia. Energy & Water Crisis: Drought is pushing the Danube to record lows, disrupting shipping and raising nuclear cooling risks across Central Europe; Bulgaria’s Kozloduy remains stable, but the wider regional pressure is growing. Danube Infrastructure & Industry: Sofia’s municipality is moving ahead with up to EUR 367M for long-term financing to modernize public transport and key infrastructure, including new trams and electric buses. Logistics & Trade Disruption: Ukraine is expanding alternative export routes for grain as Black Sea attacks and corridor freezes strain storage and logistics capacity. Security & Enforcement: Ukrainian and Bulgarian police dismantled an international drug syndicate, shutting down a clandestine lab and detaining suspects. Business & Sourcing: Texworld Apparel Sourcing Paris will bring over 1,000 exhibitors, signaling continued reshaping of textile supply chains. Water Sector Reform: Bulgaria’s regulator plans incentives to encourage consolidation in the water sector to improve service quality and keep prices affordable.

Danube Drought & Energy: Record-low Danube levels are stranding boats and forcing Hungary to shut down its nuclear plant while Romania cuts Cernavoda reactors, raising fresh alarms for cooling and power output across the region. Black Sea Trade Disruptions: Escalating attacks on ships and terminals are disrupting grain and oil flows, adding pressure to already strained commodity markets. Bulgaria Power Balance: Bulgaria’s electricity generation is up nearly 7% year-to-date, with solar leading and battery storage helping exports—while the energy minister says Kozloduy operations face no risk despite the river’s lows. Space & Defence Industrial Push: PM Radev will visit Dobroslavtsi as Bulgaria moves to build a space-data monitoring centre and a high-tech industrial park with space and defence R&D, backed by a cooperation memorandum. Recovery Funds: Radev says Bulgaria is confident it will receive most of the next Recovery and Resilience Plan payment after renegotiations tied to reforms and projects. Regional Growth Tools: Deputy PM Pulev outlines new instruments for regional development, industrial zones and infrastructure support. Drugs Crackdown: Sofia police dismantled a fentanyl lab allegedly supplying the whole country, while an international network organiser was arrested in a separate case. Agriculture Pressure: Watermelon growers are leaving crops unharvested as farmgate prices plunge amid import-driven price pressure. Minimum Wage Shock (Romania): Romania’s minimum wage rises, but employers warn textiles, trade and services may face layoffs or higher prices. Renewables Deal: PPC Group expands into Poland with a 277.3 MW wind/solar acquisition from EDP Renewables. IT Demand Surge (Cyprus): Asbis posts record profits on AI infrastructure and server demand.

Energy & Industry: Bulgaria’s industrial producer prices rose year-on-year but eased month-on-month in June, with Bulgaria still showing the highest annual inflation in the EU (18.2%); Energy Security: the Danube drought is now a direct industrial risk, with Hungary’s Paks nuclear plant running at reduced output as river cooling water becomes scarce, while Bulgaria’s ministry says Danube low levels are not yet threatening drinking water along the Bulgarian stretch; Infrastructure & Investment: Deputy PM Alexander Poulev met Vidin officials on transport links, industrial zones and a new public-private partnership draft law; Net-Zero Manufacturing: Bulgaria designated the Economy Ministry as its Single Point of Contact under the EU Net-Zero Industry Act to streamline permits for strategic clean-tech projects; Oil & Trade Policy: the government seeks to repeal temporary petroleum product export restrictions; Space/Defence Industrial Park: a cooperation memorandum was approved for a Dobroslavtsi high-tech industrial park and space/defence R&D centre; LNG Supply: DEPA Commercial completed the first LNG delivery to Bulgartransgaz via the Alexandroupolis FSRU, marking a milestone for Bulgaria’s gas system; Agriculture & Logistics: Ukraine and Romania are expanding logistics capacity through Constanța to keep grain exports moving amid Black Sea disruptions.

Danube Drought & Energy: Record-low Danube levels are forcing emergency measures across the region, with the EU closely monitoring Hungary, Romania, Bulgaria as reduced river flow hits nuclear cooling and power production; Romania has even used controlled explosions to redirect water toward Cernavodă, while navigation and tourism are disrupted. Bulgarian Recovery Funds: Bulgaria received EUR 1 bln under the Recovery and Resilience Plan, aimed at projects like kindergartens, building renovations, medical helicopters and battery-based energy storage, after renegotiations that also scrapped a planned water meter fee. Labour Market: JobTiger reports Bulgarian job postings fell 7.1% month-on-month in July, with declines across nearly all sectors, led by hotels and restaurants, while accounting and finance and marketing saw the only increases. Industrial Real Estate (Sofia): Colliers says Sofia’s industrial and logistics space remains tight, with stable prices and record-low vacancy in H1 2026, while take-up surged on new demand. Tourism & Hospitality: Black Sea hoteliers say August is holding peak-season pricing with no broad discounts, and Borovets’ jazz festival is pushing for year-round tourism. Tech & Research: A new ultrafast optical modulation approach using ultra-thin silicon metasurfaces targets faster broadband light control. Security: SBU and Bulgarian police dismantled a transnational drug operation producing alpha-PVP, mephedrone and amphetamine for Ukraine and the EU.

Industrial & Logistics Real Estate: Sofia’s Class A/B industrial and logistics stock for speculative leasing rose to 1,488,500 sq. m. by mid-2026, with demand led by FMCG (50% of take-up) and rental rates averaging ~EUR 6.00/sq. m/month for Class A and ~EUR 4.50 for Class B. Housing Market: Sofia’s new residential construction is cooling after 2025’s rush; deals are taking longer and buyers are factoring mortgage and fit-out costs more heavily. Public Finance Oversight: Lachezar Krastev was appointed Director of Bulgaria’s Public Financial Inspection Agency, replacing Plamen Todorov. Nuclear & Land Valuation: Bulgaria’s energy minister says a new appraisal for Kozloduy NPP Units 7 and 8 cuts land value about tenfold versus 2025, calling it a major “scam” case. Energy Under Pressure (Danube Drought): Record-low Danube levels are disrupting shipping and raising nuclear cooling risks across the region; Hungary nearly shut down Paks, Romania redirected cooling water, and Bulgaria is monitoring operations. Heatwave & Power: EU officials say they’re ready to convene energy coordination if needed, while stressing nuclear safety and monitoring Bulgaria, Romania and Hungary. District Heating Risk: KRIB urges Sofia Municipal Council to start a concession procedure for Toplofikatsiya Sofia after a record BGN 426m loss in 2025. Drug Enforcement: Bulgaria dismantled the country’s first documented fentanyl production facility in Sofia, arresting three suspects. Food & Agriculture: Sheep and goat pox outbreak in Blagoevgrad led to culling of 220 animals and a 20-km surveillance zone. Customs & Trade: Bulgarian customs seized lithium-ion battery-related goods worth over $2m tied to an EPPO-linked Romania investigation. Energy Storage Tech: CATL and Solarpro plan 2 GWh sodium-ion storage deployments across Central and Eastern Europe, building on Bulgaria grid-linked projects. Food Exports: MO Group expands food exports into Africa, Europe and the Caribbean, including operations in Bulgaria and Romania.

Danube Disruption: Bulgaria’s Danube keeps dropping, with four vessels aground outside the navigation channel and nine more waiting at anchor; at Vidin the level is 18 cm below zero and cargo ships are forced to run at up to 70% capacity, while the Oryahovo ferry has halted. Energy & Nuclear: Energy Minister Iva Petrova is set to visit Kozloduy NPP to review how record-low Danube water affects Units 5 and 6 and what safeguards are in place for Bulgaria’s power system. Recovery Funding: Deputy PM Atanas Pekanov says Bulgaria expects another EUR 109 mln this week under the National Recovery and Resilience Plan after anti-corruption steps unlocked the next payment. Trade Risk: Coface warns US tariff hikes are unlikely to hit Bulgaria directly, but could squeeze Bulgarian exports to Western Europe via weaker demand and higher uncertainty. Tech & Industry: CATL and Solarpro plan 2 GWh of sodium-ion storage deployments across Central and Eastern Europe, building on a prior Bulgarian grid-connected project. Startups: Estel Technologies raised €270K to expand an AI-native sales platform for tech staffing firms. Customs & Batteries: Bulgarian Customs seized goods worth over $2 mln tied to an EPPO-linked Romanian probe into EU-funded lithium-ion battery and metal structure projects. Public Safety: Police shut down a fentanyl lab in Sofia’s Filipovtsi district, with authorities saying all Bulgarian fentanyl originated there. Agriculture: Sheep and goat pox outbreak in Blagoevgrad district led to 220 animals culled and a 20-km surveillance zone.

Energy & Industry: Bulgaria’s Energy Minister Iva Petrova is set to visit Kozloduy NPP on Tuesday to review Units 5 and 6 and how record-low Danube levels are being managed, with the plant stressing Danube water is used for non-nuclear cooling and that its own shoreline pumping supports continuous supply. Power Grid Management: Romania has declared a nationwide August energy alert as drought and very low Danube flows cut nuclear output, with emergency steps including voluntary electricity reductions by major industrial users during peak hours. Danube Disruption: The Bulgarian Danube navigation situation remains “without precedent,” with ships waiting and temporary restrictions in critical sections as water levels stay far below low-navigation thresholds. Logistics & Trade: Customs in Bulgaria, with EPPO support, seized lithium-ion battery-related goods worth over $2m in Burgas and Varna, tied to an EU-funded fraud probe in Romania. Investment & Industry Cooperation: Deputy PM Alexander Poulev met the Chinese ambassador to push higher-value Bulgarian exports and joint projects in energy, infrastructure, decarbonization and transport. Retail Real Estate: CBRE says Bulgaria’s retail growth in H1 2026 was driven by retail parks, with nearly 63,000 sq m of new space completed and Sofia leading development activity. Energy Efficiency Demand: Ameresco added $1.8bn to its project backlog, citing strong demand for energy-efficiency programs and data-centre power needs.

Danube Drought & Power Crunch: Romania declared a nationwide August power alert as record-low Danube flows cut nuclear and hydro output, forcing a shutdown of Cernavodă Unit 1 and emergency work to keep Unit 2 running; voluntary electricity reductions and higher imports are being lined up. Bulgarian Navigation Watch: On the Bulgarian Danube stretch, water levels remain far below safe navigation thresholds, with ships waiting and temporary restrictions in critical sections; Kozloduy NPP is taking extra measures while the situation stays “without precedent” in decades. Customs/EPPO Battery Probe: Bulgaria’s Customs Agency, with EPPO, seized 12 containers worth over USD 2M at Burgas and Varna, including thousands of lithium-ion modular units, tied to an EU-funds fraud investigation in Romania. Logistics & Air Cargo: SolitAir added Bucharest Otopeni to its freighter network, expanding its EU reach after launching Sofia service, using third-country operator permissions. Industry Credit Stress: Allianz Trade reports longer payment periods in Bulgaria, especially in agriculture/agribusiness, construction, transport and fuel. Local Agriculture Policy: Fruit growers warn Bulgaria lacks a consistent fruit-growing and sales policy, risking orchard uprooting if producers can’t sell. Culture: Natalia Dontcheva, the Bulgarian actress known for “Doc Martin,” died at 56.

Danube Drought Hits Industry: Record-low Danube levels are disrupting navigation and trade across the Bulgarian stretch, with multiple vessels stuck and losses mounting for operators; the situation is also feeding into energy stress as low river water threatens nuclear cooling and forces emergency coordination. Nuclear Power Under Pressure: Bulgaria’s Kozloduy NPP says both units are still operating as scheduled despite the Danube drop, while Romania has moved to emergency measures to keep Cernavodă Unit 2 running, warning of potential supply risks if shutdowns spread. Energy & Infrastructure Governance: Bulgaria’s energy operator Bulgartransgaz has replaced CEO Vladimir Malinov with Kiril Ravnachki, as the country manages a wider reliability challenge tied to hydrology. Road Works Stalled: Regional Development Minister Ivan Shishkov says road construction irregularities files have been inactive for three years, linked to advance payments and alleged illegal works on major projects like Hemus and Sofia ring/road sections. Agri Policy Gap: Fruit growers warn Bulgaria lacks a consistent fruit-growing policy, arguing producers need clear production, packaging and export sales frameworks to avoid price collapses. Security & Trade Risks: A Bulgarian-flagged drug-smuggling case ends with the seized ship “Matthew” being towed to Varna after a major cocaine haul, highlighting the logistics side of enforcement. Finance & Consumer Safety: The Bulgarian National Bank warns of online fraud schemes using AI, urging victims to stop transactions and report through official channels.

Danube Disruption: Record-low Danube levels from drought and heat are bringing Bulgarian river shipping to a standstill, with vessels stuck near key points like Lom, Belene and Ruse and cargo delays hitting operators and supply chains. Energy Under Pressure: Romania’s August energy alert is tied to cooling limits at Cernavoda as Danube flow collapses, raising fears of further reactor shutdowns and pushing the region toward evening consumption curbs. Nuclear Decommissioning: Bulgaria’s Nuclear Regulatory Agency granted a 10-year licence to decommission Kozloduy Units 3 and 4, with safety and radiation protection set as top priorities. Bulgartransgaz Leadership Change: Bulgartransgaz has replaced CEO Vladimir Malinov with Kiril Ravnachki after a supervisory board reshuffle, pending regulator paperwork. EU Funding for Bulgaria: The European Commission approved Bulgaria’s fourth Recovery and Resilience Plan payment—€896m—after meeting milestones on anti-corruption, skills, decarbonisation, e-mobility and SME digital/cybersecurity. Cyber Fraud Watch: The Bulgarian National Bank warned of online scams using AI, deepfakes and “recovery room” tactics, urging victims to stop transfers and report quickly. Industrial Cooperation: Egypt and Bulgaria discussed expanding industrial cooperation, while Bulgaria’s military production ministry counterpart talks focused on localising advanced manufacturing and partnering with the private sector. Digital Transformation Governance: Parliament hosted talks with Bulgaria’s IT sector on the future of Information Services AD, pushing for a clearer legal framework for ICT governance. Labour Rights Challenge: Bulgaria’s Ombudsman said she will ask the Constitutional Court to strike down budget-law changes to minimum wage calculation and part-time work experience rules. Local Industry & Culture: A century-marking Rhodope narrow-gauge railway anniversary and Kotel’s decade-long carpet festival highlight tourism and craft ecosystems amid the summer heat.

Danube Crisis: Record-low Danube levels are bringing shipping to a standstill and forcing precautions across the region, with Bulgaria’s stretch seeing multiple critical navigation points and vessels stuck for days as drought and heat expose the riverbed. Energy Security: The hydrological shock is also hitting nuclear cooling: Romania declared an August energy alert and warned it may shut a second Cernavoda reactor, risking about 20% of national electricity, while it plans emergency imports (including from Ukraine) and urges evening conservation. Bulgarian Energy Leadership: Bulgartransgaz has replaced CEO Vladimir Malinov with Kiril Ravnachki, pending regulator approval. Nuclear Decommissioning: Bulgaria’s Nuclear Regulatory Agency granted a 10-year licence to decommission Kozloduy Units 3 and 4, setting safety and waste-management requirements for the next decade. EU Funding: Bulgaria received a new €896m Recovery and Resilience Plan payment, with the Commission confirming 23 of 26 milestones, including anti-corruption, decarbonisation, e-mobility and SME digital/cybersecurity measures. Work & Rights: Bulgaria’s Ombudsman Velislava Delcheva says she will challenge in the Constitutional Court changes to minimum wage calculation and part-time work length-of-service rules introduced via the 2026 budget act. Industry & Trade: Azerbaijan and Türkiye agreed to speed up energy corridor projects, including the Azerbaijan–Türkiye interconnector and the Azerbaijan–Georgia–Türkiye–Bulgaria green energy corridor. Finance Safety: The Bulgarian National Bank warned consumers about online fraud schemes using AI, including deepfakes, phishing and “recovery room” scams.

Recovery Funding: Bulgaria received its fourth payment under the National Recovery and Resilience Plan—€896m—after the European Commission cleared 23 of 26 milestones, pushing total approved funding above €4.169bn. Digital & Finance Security: The Bulgarian National Bank warned of online fraud using AI, deepfakes, phishing and “recovery room” scams, urging victims to stop transfers, contact banks via official channels, and report to police. Energy & Grid Risk: Romania declared a nationwide August energy alert as Danube flows drop, with a real risk of shutting Cernavoda’s second reactor and losing around 20% of electricity; Bulgaria and Greece are discussed for evening imports. Danube Shock to Industry: Record-low Danube levels are disrupting shipping and trade in Bulgaria, with vessels stuck near Belene/Batin/Zagrazhden and crews facing cascading losses. Transport & Migration Pressure: Bulgaria’s 112 operators helped rescue Bulgarian lorry drivers in France (Calais/Dunkirk) after migrants tried to enter vehicles illegally, while hauliers warn pressure is rising again. Cross-Border Energy Corridors: Azerbaijan and Türkiye agreed to speed up key interconnector and the Azerbaijan–Georgia–Türkiye–Bulgaria Green Energy Corridor projects. Food & Trade Volatility: Black Sea clashes are stoking fears of wheat price spikes as attacks target grain shipping routes. Public Health Infrastructure: Bulgaria published a draft decree for an interdepartmental coordination council for the National Children’s Hospital, aiming to restart progress after delays.

Energy & Industry: Romania declared a nationwide August alert after drought and record-low Danube levels cut electricity output, forcing reactor shutdown risk at Cernavoda and pushing emergency imports from Ukraine, with talks also involving Bulgaria and Greece. Energy & Logistics: Hungary and Romania both reduced nuclear output as cooling water availability worsened, while the Danube’s extreme low levels are disrupting shipping, tourism, and industrial supply chains across Central Europe. Agriculture & Trade: Black Sea clashes are again raising fears of wheat price spikes and shortages, as attacks on cargo shipping threaten a key route for global grain exports. EU Funding & Business Climate: The European Commission transferred €896m to Bulgaria under the Recovery and Resilience Plan, tied to anti-corruption steps and renewable energy and transport investments. IT & Compliance Training: Sofema Aviation expanded its enterprise SCORM licensing to help aviation operators run regulatory training in-house. Energy Security (Regional): Türkiye’s TPAO bought a 33% stake in Bulgaria’s Khan Tervel Black Sea exploration block, adding to the region’s energy diversification. Inflation Watch: Bulgaria’s annual inflation eased to 4.1% in July, still among the highest in the euro area. Healthcare Infrastructure: Bulgaria published a draft decree for a new interdepartmental coordination council to restart the National Children’s Hospital project.

Eurozone Inflation Watch: Eurostat’s flash estimate shows eurozone inflation rebounded to 2.9% in July (from 2.8% in June) as energy costs jumped, with energy up to 10% year-on-year and services also rising. Bulgaria in the Mix: Bulgaria’s inflation is flagged at 4.1% in July, making it one of the higher-rate countries in the bloc. Lukoil Oversight & Legal Shift: Bulgaria’s Constitutional Court ruling last week struck down key provisions that had suspended Lukoil shareholders’ rights and enabled a state special manager with limited judicial review. Food Safety Crackdown: Bulgaria’s Food Safety Agency seized 174+ tonnes of food after 12,185 inspections, issuing compliance notices and suspending operations at multiple sites; police also seized 19 tonnes of unfit chicken and 16+ tonnes of butter. Danube Disruption: Record-low Danube levels are forcing navigation changes and raising pressure on nuclear cooling and shipping, with Bulgaria’s maritime authorities warning of historic lows. Renewables Protest: Krushari residents protested planned wind farms, arguing fertile farmland and heritage areas shouldn’t be treated as priority zones without stronger consultation. Defense & Industry: Parliament approved a bill for new 3D radars for the Bulgarian Air Force, while PM Radev discussed modernization with Italy’s Leonardo. Mining Cashflow: DPM Metals posted record Q2 free cash flow and declared a dividend, with operations including Bulgaria. Energy R&D: LB Bulgaricum and Japan’s Meiji plan to complete a joint R&D lab by year-end, targeting functional foods and probiotics.