During the First World War and immediately after it serious changes took place in the Belgian investments in Bulgaria. During the war the sugar factory and tram plant in Sofia changed their owners, the latter passing into the hands of Sofia Municipality. Despite some difficulties, the largest ones – the Ruse sugar factory and Sofia electric company – remained Belgian.

Only a couple of years after the world war Belgium managed to restore its positions in the Bulgarian economy and strengthen them. The stabilization in the country after 1923–1924 created favorable conditions for attraction of foreign investments. Till the end of the decade Belgian financial groups participate with majority or substantial minority shares in dozens of industrial, credit, trade and transport companies. For example, the spirits factory in Knyazhevo, the textile mill Berov & Horinek, the trade company Socombel, a branch of the large petrol company Petrofina, etc.

An important point in the entrance of Belgium investments in Bulgaria was the establishment in 1923 of one of the largest private banks in the country in this period – the French-Belgian bank, where certain Brussels financial groups had a great input. Soon this bank set up a network of some twenty daughter companies in nearly all branches of Bulgarian economy and thus Belgian capitals went into corporations such as United Tobacco Factories (the giant in this branch), in three commercial banks, among which the Bulgarian-Belgian bank (Burgas), etc. In 1929 the French-Belgian bank merged with the Balkan Bank (which still had some Belgian capital) to form the new French-Belgian and Balkan bank – the largest in the country.

In the post-war decade Belgium remained an important trade partner of Bulgaria, though not of the dimensions of before 1914. It was one of the major markets for Bulgarian products such as cereals, tobacco, etc.

The period of successful operation of the companies with Belgian capital was followed by a time of many problems caused by the global and local manifestations of the world economic crisis 1929–1933, and the new trends in economic life.

In the 1930s the economic development of Bulgaria was characterized by two main lines, viz. an increasing intervention in the economic life on the part of the state and a growing binding of the country with the German trade and industry. These two trends had a negative effect on the Belgian-Bulgarian trade and financial ties. To these should be added factors related to the Belgian investors themselves. Thus in the early 1930s the sugar factory in Ruse was sold by its owners to an Italian group. Anyway, till the mid-1930s Belgium remained the largest foreign investor in the country, according to the statistics of stock companies in Bulgaria. In the second half of the 1930s, however, a withdrawal of Belgian capital started. Germany’s competition, as well the operation of other factors, like the restrictions imposed by the local authorities on the transfer of profit overseas, precipitated this process. Still successful was the group of the French-Belgian and Balkan Bank. In 1938 there was a serious restructuring in its major shareholders, the Belgium interest dropping significantly. Three years later, during the war, Sofia Municipality bought out the electric company in Sofia.

The process of withdrawal and diminishing of Belgian investments in Bulgaria ended after World War Two, when the communist regime nationalized the last enterprises in the country that had Belgian capital.

The review of the historical development of the bilateral economic relations at the end of the 19th and during the first half of the 20th c. shows that Belgium is a very important partner for Bulgaria both in the field of trade and (especially) in direct investments. The traditions established in that period find a kind of continuation during the last 15 years, when Belgium is again one of the most active economic partners of Bulgaria.

Associate Prof. Dr. Alexander Kostov,
Institute of Balkan Studies at the Bulgarian Academy of Sciences