The government is making one economic mistake after another. This is a mixture of populism and a lack of understanding.
After the hastily cobbled-together budget, in which both incomes and investment are falling and which is leading us toward a crisis, over the past 48 hours those in power have also hit foreign investors in the stupidest way possible. The German Schwarz Group, the largest investor in retail in our country, is in the crosshairs. The Commission for Protection of Competition fined Kaufland a record €76 million, while the Bulgarian Food Safety Agency conspicuously closed a Lidl store in Vidin.
The message is “We are crushing the big chains!” But this cheap PR stunt will prove costly:
The fine will be overturned in court, and we, the taxpayers, will pay the compensation.
We are losing €200 million in investment and the new jobs that come with it. The group is already reviewing its plans for the next three years. High-tech projects are also at risk: artificial intelligence and data centers through Schwarz Digits, as well as the logistics hub for North Macedonia.
We are hitting Bulgarian exports. Lidl’s network could export Bulgarian goods, but we are turning a partner into an enemy.
There will be a retaliatory response. A company with revenues of more than €140 billion will not sit on its hands.
Those in power are acting like an elephant in a china shop. This is irresponsible.
There is something that can be done instead. The government can work with the chains to help them export more Bulgarian goods through their networks in Europe. It can create smart strategies to attract investment linked to their European business—effectively, the export of services. Together with them, it can introduce more transparent rules for working with Bulgarian suppliers. Instead of all this, it is choosing cheap populism that deepens the problem instead of solving it.
Competent governance creates opportunities, while cheap populism destroys them in a single day.