THE DIALECTICS OF GLOBAL INTEGRATION: THREATS, OPPORTUNITIES, AND AI-DRIVEN TRANSITIONS IN THE REGIONAL DEVELOPMENT OF BULGARIA AND CEE

This paper examines the contradictory effects of global integration on regional development trajectories in Bulgaria and the broader Central and Eastern European (CEE) region within the contemporary European economic context. Drawing upon modernization and dependency frameworks, the analysis demonstrates that integration into European and global value chains has simultaneously facilitated macroeconomic convergence and entrenched structural asymmetries. Particular attention is devoted to three interrelated dynamics: (1) production relocation and the persistence of low value-added specialization, (2) sustained outward migration and demographic contraction, and (3) the accelerating transition toward Artificial Intelligence (AI)- driven economic models. While EU membership has contributed to measurable GDP growth, export expansion, and institutional stabilization, Bulgaria remains among the lowest-income Member States, with GDP per capita still below 60% of the EU average. At the same time, large-scale emigration— amounting to nearly one-fifth of the population since the 1990s—has generated both remittance inflows and severe human capital depletion. The paper argues that AI presents a potential mechanism for developmental “leapfrogging,” yet without targeted, place-based innovation policies, technological transformation risks deepening regional disparities and reinforcing peripheral dependency within the European core-periphery system. Sustainable regional development in Bulgaria and CEE therefore depends not merely on integration, but on strategic repositioning within European knowledge and innovation ecosystems.