Published on and written by Cyril Jarnias
In an ever-evolving economic context, Bulgarian SMEs are increasingly turning to European grants to strengthen their growth and competitiveness in the international market. These funds, from various European Union programs, aim to support innovation, digital transition, and the adoption of sustainable practices within small and medium-sized enterprises. By benefiting from this support, SMEs in Bulgaria have the opportunity to overcome various financial and technical obstacles while contributing to the local economy. This article explores the different available funding opportunities, eligibility criteria, and potential impacts on the Bulgarian economic fabric, providing an essential guide for entrepreneurs eager to take advantage of this financial windfall.
Introduction to European Grants for Bulgarian SMEs
European Grants: A Growth Lever for Bulgarian SMEs
European grants represent a crucial opportunity for Bulgarian small and medium-sized enterprises (SMEs) looking to boost their growth and competitiveness. These financial aids, granted by the European Union, aim to support economic development and innovation within member states.
The framework governing these grants falls under the EU’s cohesion policy, which seeks to reduce disparities between European regions. For Bulgaria, a country that joined the EU in 2007, these funds play an essential role in modernizing its economy and strengthening its competitiveness in the European market.
Eligibility Criteria and Areas of Intervention
To be eligible, Bulgarian SMEs must generally meet certain criteria:
- Employ fewer than 250 people
- Have an annual turnover not exceeding 50 million euros
- Have a total balance sheet not exceeding 43 million euros
Grants can support various types of projects, including:
- Innovation and research
- Digital transition
- Energy efficiency and environmental sustainability
- Business internationalization
- Training and skills development
Success Stories
Several Bulgarian SMEs have successfully leveraged these grants to transform their operations. For example, a Sofia-based company specializing in clean technologies received funding to develop an innovative wastewater treatment system, allowing it to become a regional leader in this field. Another SME from Plovdiv used European funds to modernize its production equipment, increasing its productivity by 30% and creating 20 new jobs.
Challenges and Solutions
Despite the opportunities offered, many Bulgarian SMEs face obstacles in accessing these grants. The main challenges include the complexity of application procedures, lack of knowledge about available programs, and difficulties in securing co-financing.
To overcome these obstacles, businesses can:
- Seek help from consultants specialized in European funds
- Participate in information seminars organized by national authorities
- Collaborate with other businesses to pool resources and expertise
- Use support services offered by local chambers of commerce
European grants constitute a powerful tool to stimulate the growth of Bulgarian SMEs, but their success depends on businesses’ ability to effectively navigate the application process and align their projects with EU priorities.
Good to know:
European grants offer crucial financial support to Bulgarian SMEs, promoting innovation, competitiveness, and sustainable development. They are governed by the EU budgetary framework, particularly the Multiannual Financial Framework, and focus on areas such as research, technological development, and expansion into new markets. Bulgarian SMEs must meet specific eligibility criteria, often related to economic viability and the environmental impact of proposed projects. For example, the Bulgarian SME “Bulgarian Rose” received funds to modernize its production of natural cosmetics, thereby increasing its exports. However, complex administrative processes and lack of information can pose obstacles to accessing these funds. Businesses can overcome these challenges by partnering with specialized consultants or participating in preparation workshops organized by local agencies.
The Main EU Structural Funds
The Main EU Structural Funds for Bulgarian SMEs
The European Union makes several structural funds available to support the economic and social development of its member states, including Bulgaria. These funds play a crucial role in supporting the country’s small and medium-sized enterprises (SMEs).
The European Regional Development Fund (ERDF)
The ERDF is one of the main instruments of the EU’s cohesion policy. It aims to strengthen economic and social cohesion within the Union by correcting imbalances between its regions. For Bulgarian SMEs, the ERDF offers funding opportunities in the following areas:
- Innovation and research
- Digital technologies
- Support for the low-carbon economy
- Sustainable resource management
A concrete example is the “Smart Factory” project in Plovdiv, where an SME specializing in electronic components production received ERDF funding to modernize its equipment and adopt smart manufacturing technologies, increasing its productivity by 30%.
The European Social Fund Plus (ESF+)
The ESF+ is the EU’s main instrument for investing in human capital. It supports employment and promotes social inclusion. For Bulgarian SMEs, the ESF+ offers opportunities in:
- Vocational training
- Employee skills improvement
- Integration of disadvantaged groups into the labor market
A Sofia-based SME specializing in software development benefited from the ESF+ to train its employees in new artificial intelligence technologies, enabling it to develop new products and increase its exports by 25%.
The Cohesion Fund
Although primarily intended for large infrastructure and environmental projects, the Cohesion Fund can indirectly benefit Bulgarian SMEs by improving the overall economic environment. It funds projects in the following areas:
- Trans-European transport networks
- Environment
- Energy efficiency
For example, the improvement of the road network between Varna and Burgas, funded by the Cohesion Fund, has enabled several SMEs in the region to improve their logistics and more easily access international markets.
The European Agricultural Fund for Rural Development (EAFRD)
The EAFRD is specifically designed to support EU rural areas. For Bulgarian SMEs in the agricultural and agri-food sector, it offers opportunities in:
- Modernization of agricultural holdings
- Development of value-added products
- Diversification of economic activities in rural areas
A small family business in the Plovdiv region received EAFRD funding to develop rural tourism activities in addition to its organic wine production, increasing its revenue by 40% in two years.
Recent and Future Initiatives for Bulgarian SMEs
The EU has recently launched several initiatives aimed at strengthening support for Bulgarian SMEs:
The InvestEU program: This program aims to mobilize public and private investments using an EU budget guarantee. In Bulgaria, it is expected to unlock more than 1.5 billion euros in additional investments for SMEs by 2025.
The NextGenerationEU recovery plan: Under this plan, Bulgaria will benefit from additional funds to support the digital and green transition of its SMEs. Particular emphasis will be placed on green economy sectors and technological innovation.
The Digital Europe program: This new EU program will support the digital transformation of Bulgarian SMEs, with a focus on artificial intelligence, cybersecurity, and advanced digital skills.
These initiatives should enable Bulgarian SMEs to strengthen their competitiveness, innovate, and adapt to future challenges, thereby contributing to the country’s economic growth and convergence with European standards.
Good to know:
The main structural funds of the European Union that support Bulgarian SMEs include the European Regional Development Fund (ERDF), the European Social Fund (ESF), the Cohesion Fund, and the European Agricultural Fund for Rural Development (EAFRD). The ERDF aims to strengthen competitiveness by funding technological innovations and improving local infrastructure. The ESF focuses on developing human capital, particularly by promoting training to improve employee skills. The Cohesion Fund finances large infrastructure projects to reduce economic disparities, while the EAFRD encourages agricultural activities and rural development. Bulgarian SMEs, such as technology startups funded by the ERDF, have successfully modernized their equipment thanks to this support, thereby increasing their competitiveness and job creation. Projects must meet certain sustainability and innovation criteria, and recent initiatives aim to simplify access to these funds for SMEs, particularly through online platforms that centralize applications and practical advice.
Procedures and Criteria for Obtaining Funding
Application Procedure for Bulgarian SMEs
Bulgarian SMEs wishing to obtain European grants must follow a specific procedure. The first step is to identify the appropriate funding program based on their sector of activity and objectives. Businesses can consult the European Commission’s participant portal to find relevant calls for proposals.
Once the program is identified, SMEs must:
- Register on the participant portal to obtain a unique identification code
- Verify their eligibility according to the program’s specific criteria
- Prepare a detailed proposal meeting the call’s requirements
- Submit the application before the indicated deadline
It is crucial to strictly adhere to deadlines, which generally range from 3 to 6 months after the call’s publication.
Eligibility Criteria and Required Documents
To be eligible, Bulgarian SMEs must generally:
- Be legally established in Bulgaria
- Have fewer than 250 employees
- Have an annual turnover not exceeding 50 million euros
- Be financially viable
Documents typically required include:
- A duly completed application form
- A detailed business plan
- Financial statements from recent years
- Documents attesting to technical and operational capacity
- Letters of commitment from partners (if applicable)
Types of Available Grants
Bulgarian SMEs can apply for various types of grants, including:
The SME Instrument from the Horizon Europe program, which offers phased funding for innovative projects with high growth potential.
The COSME program, focused on improving competitiveness and access to financing for SMEs.
The European Structural and Investment Funds, managed at the national level, which support regional and sectoral development.
Relevant European Bodies
The main bodies to which Bulgarian SMEs can apply are:
- The European Commission, through its various directorates-general
- The Executive Agency for Small and Medium-sized Enterprises (EASME)
- The European Investment Bank (EIB)
- National managing authorities for structural funds
Priority Elements for Evaluators
Evaluators place particular importance on the following aspects:
- The innovative nature and European added value of the project
- The potential impact on the company’s growth and competitiveness
- The technical and financial feasibility of the project
- The quality of the implementation plan and risk management
- The team’s capacity to successfully carry out the project
Tips to Maximize Success Chances
To increase their chances of obtaining funding, Bulgarian SMEs should:
Align their proposal with the program’s specific objectives and clearly demonstrate how their project will contribute to them.
Highlight the potential impact of their project on the European and Bulgarian economy.
Build a strong consortium with complementary partners, if required by the program.
Present a realistic and detailed budget, justifying each proposed expense.
Seek help from experts in proposal writing to ensure all aspects of the application are properly addressed.
Good to know:
Bulgarian SMEs wishing to obtain a European grant must first identify the appropriate program through platforms such as the EU’s Funding and Tenders portal, then develop a proposal in English that aligns with the call’s thematic priorities. It is essential to meet strict deadlines for submitting the initial application, often after going through a pre-selection stage. Eligibility criteria include, among others, a minimum number of employees and a clear business plan presenting the project’s potential impact. Required documents typically include the application form, financial statements, and proof of partnership, if applicable. Grants, which can be direct grants, guarantees, or loans, often require registration with institutions like Horizon Europe or the ERDF. To maximize success chances, it is advisable to network with other potential beneficiaries and consult application writing guides provided by the European Commission. Prioritizing innovation and demonstrating increased social or environmental contribution is often crucial to capturing evaluators’ interest.
Success Stories Thanks to European Grants
Success of Bulgarian SMEs Thanks to European Grants
Bulgaria has experienced remarkable growth in its small and medium-sized enterprises in recent years, largely thanks to European Union grants and funding programs. Several success stories illustrate the positive impact of this support on economic development and innovation in the country.
TechnoLogica: From Start-up to Technology Leader
TechnoLogica, a start-up specializing in software development, benefited from a 500,000 euro grant from the Horizon 2020 program in 2019. This aid allowed the company to accelerate the development of its artificial intelligence platform for data analysis. Today, TechnoLogica has more than 100 employees and its solutions are used by businesses throughout Europe.
TechnoLogica’s CEO, Ivan Petrov, testifies: “Without European funding, we could never have developed our technology so quickly. This grant was a real springboard for our international growth.”
EcoFarm: Organic Agriculture Conquering Europe
In the agricultural sector, EcoFarm received a 300,000 euro grant from the European Agricultural Fund for Rural Development (EAFRD) in 2020. This family-run SME specializing in organic fruit and vegetable production was able to modernize its facilities and obtain international certifications.
Maria Ivanova, owner of EcoFarm, recounts: “Thanks to European aid, we were able to invest in state-of-the-art equipment and train our staff. Today, our products are exported throughout Europe and we have tripled our turnover in just two years.”
CleanTech Bulgaria: Innovation Serving the Environment
In the clean technology field, CleanTech Bulgaria distinguished itself by obtaining a 750,000 euro grant from the LIFE program in 2021. This company developed an innovative industrial wastewater treatment system, now used in several European countries.
CleanTech Bulgaria’s technical director, Georgi Dimitrov, explains: “European funding allowed us to move from prototype to large-scale production. We created 30 new highly skilled jobs and our technology helps reduce the environmental footprint of many industries.”
SoftUni: Training the Next Generation of Developers
In the education sector, SoftUni, an online programming academy, benefited from a 400,000 euro grant from the European Social Fund in 2022. This aid allowed the company to develop new curricula and offer free training to more than 5,000 young Bulgarians.
Svetlin Nakov, founder of SoftUni, emphasizes: “EU support allowed us to democratize access to digital skills in Bulgaria. Our graduates are now recruited by the world’s largest technology companies.”
BioTech Pharma: Bulgarian Pharmaceutical Innovation
In the pharmaceutical sector, BioTech Pharma received a 1 million euro grant from the Horizon Europe program in 2023 to develop a new cancer treatment. This 50-employee SME was able to accelerate its research and enter the clinical trial phase.
Dr. Elena Petrova, research director at BioTech Pharma, states: “European funding was crucial in allowing us to compete with large pharmaceutical groups. We are now on track to commercialize a treatment that could save thousands of lives.”
These examples illustrate how European grants have enabled Bulgarian SMEs in different sectors to develop, innovate, and conquer new markets. These success stories contribute not only to Bulgaria’s economic growth but also to strengthening its position on the international stage as a hub of innovation and entrepreneurship.
Good to know:
The Bulgarian company “BioBo” transformed the agricultural sector thanks to a 200,000 euro grant from the Horizon 2020 program, allowing them to develop sustainable biotechnological solutions, after which it was praised at the Brussels Innovation Forum. In the technology field, “DigitSys” used 150,000 euros in funding from the COSME program to expand its cloud services, enabling it to increase its turnover by 30% in two years, and was recognized by the IT Innovators Congress. Similarly, “GreenWave Energy” benefited from 250,000 euros from the European Regional Development Fund (ERDF) to install solar panels in rural areas, which reduced local energy costs by 25%, while reinvesting in local employment. Testifying to the positive impact of this aid, the CEO of “TechRev” stated that without European funding, expansion into foreign markets would have remained a distant dream. Each example illustrates how these grants can catalyze significant growth, diversify sectors, and strengthen the international competitiveness of Bulgarian SMEs.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
