With the United States emerging as one of Bulgaria’s most dynamic and high-potential trade partners, the transatlantic economic relationship has reached new heights. In 2024, Bulgarian exports to the U.S. surged to $1.5 billion, making America one of Bulgaria’s top non-EU export destinations. This remarkable growth reflects Bulgaria’s increasing competitiveness in key industries and the expanding role of Bulgarian companies in the U.S. market.
To provide deeper insight into these trends, Dnevnik spoke with Ivo Konstantinov, Head of AmCham Bulgaria’s Office in Washington, D.C. In this exclusive interview, he discusses the key factors driving Bulgaria’s export success, the challenges businesses face when entering the U.S. market, and the strategic role of AmCham Bulgaria’s D.C. office in supporting trade and investment. From the integration of Bulgarian manufacturers into global supply chains to the untapped potential in niche industries, Konstantinov outlines the opportunities and obstacles shaping the future of Bulgarian-American business relations.
1. In 2022, U.S. exports to Bulgaria amounted to $381 million, while Bulgarian imports to the U.S. totaled $496 million. How would you explain the significant difference between imports and exports, and in which market niches do you believe we could increase exports this year and next?
The data for 2024 is even larger—$1.5 billion in exports from Bulgaria compared to just under $0.5 billion in imports from the U.S.—which places the U.S. among the top export destinations for Bulgaria in non-EU and non-neighboring markets (and in some years, even the top export market for us).
The difference is due to several factors:
- The competitive pricing advantage of Bulgarian products in the U.S. market in certain sectors, such as dairy products, machine components, and clothing.
- The integration of manufacturing facilities in Bulgaria into the supply chains of major American and multinational companies, such as ADM, Sensata Technologies, IKEA, and others.
- Traditional industries in which Bulgaria is a global leader with little competition in the U.S. market, such as essential oils, oriental tobacco, and cocktail cherries.
- Acquisitions that have automatically introduced Bulgarian production into the U.S. market. A key example is Mondelez’s acquisition of Chipita, making their products available in America.
- Successful market entry projects, such as Bulgarian precursors for veterinary drugs and feed additives, synthetic diamonds for surface cleaning, and sheep cheese.
The Bulgarian community in the U.S., which includes over 500,000 first- and second-generation Bulgarian immigrants, also plays a significant role in trade through their consumption of Bulgarian food products imported from Bulgaria and shared with their American friends. Another contributing factor is the establishment of American companies with manufacturing bases in Bulgaria, such as high-resolution optical cameras (Florida – Kazanlak) and robots for semiconductor production and industrial and military applications (Boston – Plovdiv), among others.
Regarding Bulgaria’s untapped export potential in the U.S., we have identified several industries where the country performs well in international markets but remains somewhat passive toward America. These include cathode copper, bicycles (including electric bikes, which saw a boom during and after the 2020-2022 pandemic), and niche showcase products like cosmetics and herbs. However, their promotion requires investment and marketing efforts to gain visibility and break into the market.
There is also significant potential for increasing sales of Bulgarian products already exported to the U.S., but where businesses do not invest in the essential measures for generating interest and acquiring customers in the highly competitive American market. The American Chamber of Commerce in Bulgaria has been addressing these high-potential areas for years. This is one of the key tasks of our U.S. office—to support Bulgarian companies in entering the market and to promote Bulgaria as an investment destination for American companies.
This task is particularly important in the context of the new U.S. administration and its slogan of making America stronger, more secure, and more prosperous. Bulgaria should not only recognize itself in this vision but also take the necessary steps to strengthen bilateral relations within the transatlantic economy.
2. What challenges do Bulgarian companies face when trying to expand their business in the U.S.?
The U.S. is a highly welcoming market from a regulatory and customs perspective (at least for now). There are very few goods subject to bans, tariff and non-tariff restrictions, or heavy regulatory licensing requirements. Even food, cosmetics, and dietary supplements, for example, are exported to the U.S. based on self-regulation—voluntary compliance with existing requirements and risk-based inspections. For food products, U.S. regulations are not stricter than those in the EU, meaning that most Bulgarian producers are already prepared for compliance.
However, the challenge in the U.S. market is its saturation and strong competition. Sales require stimulating demand through marketing. This is a market where there is a cost to “acquiring each customer,” paid through marketing and promotional efforts. In the U.S., customer acquisition costs are always borne by the Bulgarian exporter, almost never by their American partner.
The American economy is relatively closed in terms of foreign trade, which often surprises Bulgarian companies entering the market for the first time, as they expect a cosmopolitan and open environment. When presenting Bulgaria and a new product, it is often better to frame them as European, as many American business partners are unfamiliar with the distinctions between different European countries—just as we might struggle to name all 50 U.S. states.
Another challenge is the lack of consistent, long-term measures for export promotion and the popularization of even a few high-potential Bulgarian priority goods.
3. What types of Bulgarian businesses are interested in entering the U.S. market?
For consumer goods, industries with highly developed manufacturing and technological capacities generating overproduction often seek expansion, as the European and nearby markets are too small—such as dairy products, dietary supplements, cosmetics, and furniture.
In the technology sector, there has been a dramatic increase in Bulgarian outsourcing companies seeking to establish themselves in the U.S. due to excess capacity, growing global competition from players like Vietnam and Colombia, and the end of a 20-year cycle where Bulgaria was price-competitive.
Bulgarian software product companies are also highly active in entering the U.S. market and have greater potential for success than traditional outsourcing firms.
The commercialization of space is fostering the growth of a new high-tech industry that positions Bulgaria on both the global map and beyond.
4. How does the American Chamber of Commerce’s U.S. office support Bulgarian businesses?
AmCham, as we are known globally, has one of only five American Chamber offices operating in the U.S. The others are in the UK, Vietnam, Egypt, and a coalition of Scandinavian chambers. However, we are the only one offering business services for market entry.
Our U.S. representation, established four years ago, focuses more on business support than trade policy and protocol, filling a niche for market entry services not only in Bulgaria but across Europe.
Today, our U.S. trade entity is a fully-fledged subsidiary providing shared and outsourced market entry services for Bulgarian and European companies in the U.S. market, as well as technology transfer. With a broad team coordinated from Washington, covering both coasts and central U.S., we offer support defined locally as “soft landing” services, including company registration, opening bank accounts, visa guidance, compliance with the FDA, selection of accountants and attorneys, etc.
Our “hard” services, which are our core business, involve complete project management for market entry—from strategy selection and regional focus in the U.S. to product development, identifying partners, establishing buyer connections, and developing both online and physical sales channels.
5. What are the preferred niche and low-budget entry channels for businesses?
Depending on the industry, we guide our AmCham Bulgaria partners and members toward these channels, considering the limited budgets of many newcomers to the U.S. market. Some surprising and original sales channels include networks of ethnic and immigrant schools, vending machine operators (especially in remote areas and islands), food trucks, branding under interest clubs and minority groups, supplying ship crews, and farmers’ markets.
For technology and service sales, companies must be highly creative in attracting American partners. We advise tech firms on strategies such as positioning as investors, integrating into university accelerators, exchanging client bases, offering installment payments, expanding partnerships in Europe, and leveraging EU funds in exchange for contracts.
6. What impact do you expect U.S. tariffs on the EU to have on Bulgaria?
It remains to be seen what specific tariffs will be introduced and whether they will represent the final stance of the administration in Washington. Often, such measures are used as a tool to prompt reforms and necessary changes among their trade partners, as well as to strengthen negotiating positions.
Our experience with the previous Trump administration (2016–2020) showed that very few Bulgarian businesses suffered from the trade war between the U.S. and the EU, with only minor exceptions in steel, cow cheese, and aluminum.
There is a strong possibility of a favorable scenario for Bulgaria, in which supply chains are redirected from China to EU countries that have retained their production capacity, such as Bulgaria. This is particularly relevant in sectors like machine components and canned foods. This shift, known as nearshoring, is a process that AmCham Bulgaria has been advocating for since the pandemic years.
7. Why should Bulgarian businesses consider trading with or investing in the U.S. now, given the perception of regulatory and legislative instability and global trends suggesting alternatives to the American market?
Despite daily news from the U.S. and the perception of a fundamental shift in U.S.-EU relations, the U.S. remains the world’s largest consumer market. It is a well-known fact that if a product or service succeeds in the U.S., it can become a global success.
Moreover, for some mature products and services where Bulgaria experiences overproduction, expansion into the U.S. is simply the only viable alternative.
Regulatory-wise, the U.S. is likely to remain a predictable partner. Under the current administration in Washington, compliance and licensing restrictions are expected to decrease rather than increase.
8. Do you believe that Bulgarians want American goods, as the U.S. administration insists on increasing purchases of “Made in America” products?
The U.S. has a limited market presence in Bulgaria for consumer goods (such as food and beverages), not due to a lack of demand, but rather because of supply constraints. The efforts of the U.S. Embassy’s Commercial Section have led to the introduction of American whiskey, meats, and other products.
When it comes to industrial equipment and technology, American products have a strong reputation and are widely adopted in Bulgaria. However, Bulgaria’s market size is small in relation to the ambitions of major U.S. corporations, which often results in a lack of responsiveness and interest from large and mid-sized American manufacturers in potential distribution partnerships.
Over the past 3–4 years, Bulgaria has taken concrete steps toward diversifying its energy sources. The increasing imports of U.S. energy resources (natural gas, including LNG, and oil) and American energy technologies (compression stations, digitalization in energy, and the construction of Units 7 and 8 of the Kozloduy Nuclear Power Plant) clearly indicate Bulgaria’s orientation toward the U.S. as a reliable industrial and high-tech partner.
In this regard, Bulgaria could take inspiration from Poland, which has made significant economic progress over the last 15 years through a close partnership with the U.S.
It would be an overstatement to claim that the U.S. does not export enough to Bulgaria due to some supposed “deindustrialization” of the American economy—despite the popularity of this narrative. However, the restructuring of key American industries certainly plays a role in shaping trade flows.
Given the new U.S. administration’s sensitivity to trade deficits, it is important to view economic relations as more than just trade in goods. This is especially relevant in the current context of U.S.-EU trade policy dynamics. The U.S. holds a highly competitive position in Bulgaria and Europe in the export of services, licensing revenues, consulting activities, sales of federal debt instruments, and, most notably, the use of the U.S. dollar as a global payment currency. Contrary to some growing concerns in Washington, the overall balance of payments between Bulgaria and the U.S., as well as between the EU and the U.S., remains mutually beneficial.