Sustainability and Agricultural Investments in Bulgaria: Balancing Profitability and Environmental Protection

Agriculture in Bulgaria faces increasing pressure to balance profitability with environmental sustainability under the evolving framework of the Common Agricultural Policy (CAP) and the European Green Deal. This study investigates how sustainability-oriented investments influence the economic performance of Bulgarian farms using Farm Accountancy Data Network (FADN) data. The analysis integrates investment, cost, and productivity indicators into an econometric model assessing the relationship between subsidies, input intensity, structural characteristics, and farm profitability. Results show that environmental payments, when aligned with efficient management, enhance profitability, whereas conventional investment and rural development support display limited or delayed effects. High expenditure on fertilisers and crop protection products reduces profitability, confirming cost inefficiency in input-intensive systems, while energy-related spending contributes positively, suggesting gains from mechanisation and precision technologies. Structural factors - particularly farm size and land productivity - remain key for balancing economic and environmental goals. The findings underline that sustainable profitability is achievable but unevenly distributed, shaped by access to capital, managerial capacity, and policy design. The study offers empirical evidence for aligning sustainable investments incentives with farm-level competitiveness and contributes to the ongoing transition toward integrated economic-environmental monitoring within the Farm Sustainability Data Network (FSDN).