The United States and Bulgaria share a longstanding partnership rooted in shared democratic values, NATO alliance, and mutual economic interests. However, the imposition of sanctions by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) on certain Bulgarian individuals has introduced complexities into this relationship. Reevaluating and potentially removing these sanctions could serve as a catalyst for renewed cooperation and economic development for both nations.
Current Sanctions and Their Impact
OFAC’s 2021 sanctions targeted Peevski, Bozhkov, and 64 entities, followed by 2023 sanctions on five officials, including Vladislav Goranov. These measures aimed to curb alleged systemic “financial” corruption, which the US claims costs Bulgaria hundreds of millions annually. However, the reality is sanctions disrupt financial networks, with Bulgarian banks freezing accounts to avoid penalties, as seen with Bozhkov’s political party. Additionally, trade and investment face indirect effects, as sanctions signal instability, potentially deterring US firms. By lifting these sanctions, the U.S. would signal a commitment to respecting Bulgaria’s sovereignty and legal processes, thereby reinforcing diplomatic ties and fostering a more collaborative environment.
Benefits of Removing Sanctions
Lifting OFAC sanctions will strengthen US-Bulgaria ties. As a NATO ally that hosts joint military exercises and actively seeks closer economic integration with the United States, Bulgaria deserves policies that reinforce, not undermine, this partnership. The sanctions currently in place damage diplomatic relations and obstruct progress. Individuals like Vladislav Goranov have been targeted without due process, and the Bulgarian court’s 2024 ruling against the enforceability of Magnitsky sanctions affirms their illegitimacy. These measures are viewed domestically as foreign overreach, with 45% of Bulgarians expressing distrust in outside interference. Removing the sanctions would demonstrate respect for Bulgaria’s sovereignty and signal confidence in its institutional reforms.
Trade and investment would see immediate benefits. US investment in Bulgaria reached $600 million in 2024, concentrated in sectors like IT and energy. Sanctions inject legal and financial uncertainty, discouraging firms from engaging with even remotely affiliated entities. Eliminating these restrictions could increase foreign direct investment by an estimated 10%, following the precedent set by Poland’s recovery after its sanctions were lifted. Critical sectors such as technology (where US companies like IBM already employ over 1,000 Bulgarians) would operate with fewer barriers and greater confidence. Bulgarian exports, including wine and machinery, would also see expanded access to US markets, helping close the existing $200 million trade deficit with the US.
Pathways Forward
Reassessing and removing OFAC sanctions on Bulgarian individuals presents an opportunity to strengthen U.S.–Bulgarian relations, stimulate economic growth, and support democratic institutions. Even a phased approach would be an enormous step forward and could balance benefits and risks. Such a move would reflect a strategic alignment of interests and a shared commitment to a prosperous and collaborative future.
Conclusion
Removing OFAC sanctions from Bulgarian individuals is a strategic investment in a stronger, more cooperative U.S.–Bulgarian alliance. At a time when global alliances are being tested and regional stability is critical, restoring trust and clearing obstacles to economic engagement will benefit both nations. It will send a clear signal that the United States values its partnerships with NATO allies, respects sovereign legal processes, and supports the prosperity of emerging democracies.
By lifting these sanctions, the U.S. has an opportunity to reset the relationship, unlock new trade and investment potential, and demonstrate that long-term cooperation is more powerful than punitive measures.
