Bulgaria’s economy grew by 3.1 per cent last year, based on preliminary data, the country’s National Statistics Institute (NSI) said. In real terms, gross domestic product (GDP) in 2018 was BGN 107.9 billion in current prices. In the fourth quarter, Bulgaria’s economy grew by 0.8 per cent compared to the previous quarter and 3.2 per cent year-on-year. In real terms, GDP in the last three months of 2018 was BGN 29.8 billion. NSI’s preliminary data gave a breakdown by key growth components only for the last quarter of 2018, not the full year. Fourth-quarter figures showed domestic consumption shrink for the first time in four years, on a quarterly basis, declining by 0.1 per cent compared to the previous three months, but was five per cent up on an annual basis. Gross fixed capital formation in the fourth quarter increased by 2.8 per cent and was 6.6 per cent higher on an annual basis. Exports in the fourth quarter rose by 3.1 per cent, while imports increased by 2.4 per cent (year-on-year, exports were 1.4 per cent higher and imports rose by 1.6 per cent). In real terms, the fourth-quarter trade deficit was BGN 641 million, but the full-year trade balance showed a surplus of BGN 915 million, the equivalent of 0.9 per cent of GDP.

Starting next year, banks will have to drastically reduce the fees they charge for money transfers in euro between Eurozone countries and Bulgaria. A new EU regulation becomes effective in December, which will restrict Bulgarian banks from charging high fees for international euro-denominated money transfers and make them equal to the fees charged for internal lev-denominated transfers. This translates into annual losses in the tens of millions for banks, which will increase other fees and commissions to offset the new rules.

The Bulgarian fintech company Phyre opens an office in Romania. The start-up offers a mobile phone payment service and a free transaction from one user to another through an application. Phyre already has 25,000 active users in Bulgaria. The company has decided to expand its operations in Romania because of the similarity of the two markets. More and more Romanians are paying with debit or credit cards, and in the first quarter of 2018, card payments have risen 33% over the same period in 2017, according to Romanian Ziarul Financiar (zf.ro). At the same time, there is no established market leader in mobile payments and digital portfolios, and, like Bulgaria, Apple Pay and Android Pay are not yet operational. The company has entered into a partnership with Romania's largest trader of machinery - Altex. The company has over 100 physical sites in the country, over 4,000 employees and hundreds of thousands of customers a month. In addition to technological products, the chain offers a wider range of goods - from cosmetics to car tires.

Bulgarian supermarket chain Fantastico, operated by local company Van Holding, said that it has invested over BGN 24 million in the upgrade of one of its stores in Sofia. Following the investment, Fantastico will hire an additional 50 people. The store located in the southern outskirts of Sofia has a built up area of 4,090 sq. m. Fantastico, established in 1991, operates 42 stores in three Bulgarian cities - Sofia, Elin Pelin and Kyustendil. The company employs over 3,100 people. 

Bulgaria's First Investment Bank (Fibank) said its consolidated net profit after minority interest grew to BGN 164.6 million in 2018 from BGN 92.2 million the year before, as revenue from sale of assets soared. Fibank gained BGN 81.1 million from assets sales last year, sharply up from BGN 10.6 million in 2017. Revenue from banking operations fell to BGN 391.4 million in 2018 from BGN 406.6 million a year earlier. Net interest income edged up to BGN 267.1 million from BGN 260.9 million in 2017, while net fee and commission income dropped to BGN 97.1 million from BGN 102.1 million. Administrative expenses rose to BGN 212.1 million last year from BGN 204.7 million the year before, while depreciation costs increased to BGN 82.6 million from BGN 78.9 million. The bank's capital adequacy ratio improved to 16.12% at the end of 2018 compared to 16.05% at the end of 2017. Fibank's liquidity coverage ratio at the end of last year stood at 251.43%. Fibank's assets increased to BGN 9.31 billion at the end of 2018 from BGN 8.64 billion a year earlier.

US-based electric battery manufacturer EnerSys said that its board of directors has approved a plan to shut down its facility in the Bulgarian city of Targovishte, which produces batteries for diesel-electric submarines. "Management determined that future demand for batteries of diesel-electric submarines was not sufficient given the existing number of competitors in the market," EnerSys said in a statement. "EnerSys plans to sell or transfer the plant and possibly the equipment to other parties if possible," it added The company expects to incur a pre-tax charge of approximately USD 32 million, of which USD 22 million in asset write-offs and USD 10 million for severance, clean up and remediation related to the facility and contractual releases. EnerSys' Bulgarian unit turned to a net profit of BGN 2.35 million in 2017, from a net loss of BGN 1.13 million in 2016, according to the latest available data from the commercial register. The company booked sales revenue of just over BGN 21 million in both 2017 and 2016.

Bulgaria's Euroins Insurance Group (EIG), part of diversified group Eurohold Bulgaria, has agreed to acquire four units of Germany's ERGO based in three European countries. ЕIG will acquire ERGO’s life and non-life subsidiaries in Romania and the Czech Republic, as well as a non-life insurer in Belarus. "The acquisition of ERGO's subsidiaries in Romania, the Czech Republic and Belarus perfectly suits our strategy to expand our presence in the CEE and CIS markets, which provide huge potential for growth, and at the same time to diversify our product portfolio," Jeroen van Leeuwen, Chief Operating Officer of EIG, was quoted as saying in the statement. The four companies' combined premium income amounted to EUR 72 million in 2017. The deal is subject to regulatory approval. Last year, EIG acquired the travel insurance business of ERGO in Ukraine - ERV Ukraine. EIG operates in nine European countries and owns insurance subsidiaries in Bulgaria, Romania, North Macedonia, Ukraine and Georgia.

Greece is cutting taxes on dividends by 33 percent, hoping to draw investors and provide some relief for companies, which have complained about overtaxation since Greece’s debt crisis nearly a decade ago. A bill passed by parliament on Wednesday will lower the tax rate on dividends to 10 percent from 15 percent, effective from January 2019. The reduction is expected to cost the state 45 million euros ($50.92 million)a year from 2020. Tax revenues from individuals and businesses as a percentage of gross domestic product reached 39.4 percent in 2017, up from 32 percent in 2010, according to an OECD report published last year. The average among the OECD’s 36 countries is 34.2 percent. The government has promised to gradually reduce corporate tax to 25 percent from 29 percent over a four-year period; the corporate rate was reduced to 28 percent this year. Greece emerged from its third bailout last August and its economy has been recovering for more than two years.

Nokian Tyres has made significant progress on its first North American production plant and remains on schedule to begin commercial tire production in the new manufacturing facility in 2020. The exteriors of the factory’s mixing tower and production building are largely complete, and workers are currently installing state-of-the-art manufacturing technology inside the Dayton facility. The level of automation will make it one of the most advanced tire production facilities in the world. The $360 million, 77,000-square-meter manufacturing facility will serve customers across the United States and Canada while doubling down on Nokian Tyres’ commitment to safe, sustainable products and processes. Approximately 200 workers are on the construction site each day building the company’s first North American production factory and bolstering the local economy in the process. In addition to making four million tires each year, Nokian Tyres will also be able to store as many as 600,000 tires at an onsite distribution facility. The expanded production volume will allow each of the company’s global tire plants to tailor production to the needs of its target markets, resulting in an enhanced product mix and even stronger service to customers.

Chinese telecoms equipment maker Huawei Technologies sued the U.S. government saying a law limiting its U.S. business was unconstitutional, ratcheting up its fight back against a government bent on closing it out of global markets. Huawei said it had filed a complaint in a federal court in Texas challenging Section 889 of the National Defense Authorization Act (NDAA), signed into law by U.S. President Donald Trump in August, which bars federal agencies and their contractors from procuring its equipment and services. The lawsuit marks the latest confrontation between China and the United States, which spent most of 2018 slapping import tariffs on billions of dollars worth of each other’s goods. The year ended with the arrest of Huawei’s chief financial officer (CFO) in Canada at U.S. request, to the consternation of China. Long before Trump initiated the trade war, Huawei’s activities were under scrutiny by U.S. authorities.