The standard of living fell by about 40%. In addition, UN sanctions against Yugoslavia and Iraq had a very negative impact on the Bulgarian economy.
Since 1997 the country began to recover with growing GDP, increasing foreign investments and macroeconomic stability. Important steps have been taken in privatisation, banking sector reforms and agricultural liberalization. The privatisation of agro-industrial enterprises gathered speed, and more than 68% of the assets in agriculture and more than 85% of the assets in the food industry in Bulgaria are now privately run. The trade and pricing policies are fully liberalized.
The Bulgaria-EU accession talks were initiated in the beginning of 2000 as the Government has set up an ambitious agenda to complete them by 2006. The main components of the reform program continue to be fast and transparent privatisation and restructuring of the state-owned enterprises, the financial and banking sector reform, the liberalization of agricultural and energy sectors, the adoption of the health insurance system, the pension system reform, and the administrative reforms in the public sector.
Chemical industry is a leading sector in Bulgarian industry. It provides a number of intermediary and final products for the domestic and export markets such as fertilizers, soda, plastics, PVC, polyamide and polyester fibers, paints, detergents, pharmaceuticals and cosmetics.
They have a real share of Bulgarian export. Products of tobacco and food industry in Bulgaria accounted for 19.% of total industrial output, with an export share of 16.7 %. Tourism is the fastest growing sector in the Bulgarian economy with excellent opportunities for foreign investment with high return on investment ratios.
Other sectors having strategic position in the Bulgarian economy are mechanical and electrical engineering, ferrous and non-ferrous metallurgy,electronics industry and telecommunications.
On April 25th, 2005 the Bulgaria-EU Accession Treaty was signed. Bulgaria joined the EU in January 2007.