"Maybe the timing isn't exactly right," said Borislav Stefanov, who heads the agency, putting his better foot forward. He addressed a group assembled in a top-floor meeting room of a Manhattan hotel last week, a bird's eye view of Central Park in the background.

"We are a dynamic, vibrant, democratic society," proclaimed Elena Poptodorova, Bulgaria's ambassador to the U.S., who pinch-hit for the absent minister, and tried to spin those assembled with the somewhat fanciful notion that investments to her country will grow despite political uncertainty. "Governments come and go."

Ah, if only the world worked that way. More to the point, if only the European Union worked that way. Political upheaval first in Bulgaria and now, much more seriously, in Italy not only threatens to upend the EU's fragile political equilibrium, it gives investors another reason to push the pause button. Dispassionate logic and economic reason suggest investment opportunities still abound in various EU nations, including Italy and, yes, even Bulgaria. The voices of dissatisfied electorates scream out "Not so fast!"

Until the last few days, the EU had been enjoying a period of relative quiet. Greece no longer appeared to be on the verge of fleeing the euro zone. Spain was finally getting a grip on its property-led meltdown. Ireland was well on its way to a tough-love recovery.

All that translated into an upbeat investment appraisal. While 2012 foreign direct investment totals for the region were nowhere near pre-crisis levels, there were plenty of optimistic signs. One veteran New York deal lawyer just before Christmas talked of a flurry of M&A activity across Europe, saying, in effect, that the time for bargain acquisitions may have passed.

Until they were beset by political upheaval, Bulgaria and Italy exemplified a buoyant assessment, but for very different reasons. In Italy, domestic liquidity has dried up. So, even stellar, midmarket Italian companies, with great export track records, are desperate for capital. Begrudgingly, more of these family-owned companies are at least willing to discuss an equity partner or a buyout.

Bulgaria is the poorest country in the EU, with a cost of living about half that of its far richer European neighbors and a low tax regime to boot. So, for those looking at a cheap way to enter the huge EU marketplace, Bulgaria is a natural, even if it continues to suffer from rampant corruption and questionable rule of law.

One reason for Bulgaria's attraction is extremely low electricity costs, although power in Bulgaria also ranks as among the least reliable in the EU. Three foreign companies -- the German E.ON AG, Austria's EVN Group and the Czech CEZ Group -- acquired majority interests in the country's three regional utilities in 2004, the biggest bout of foreign investment the country had seen. Last year, another Czech company, Energo-Pro AS, bought out E.ON Bulgaria. Several months later, the government floated its minority interest in CEZ Bulgaria on the Sofia Stock Exchange.

A relatively modest 13% increase in utility charges triggered popular demonstrations, which also lashed out at chronic graft. Before falling on its collective sword, the government of Prime Minister Boiko Borisov promised a partial rollback of electric rates. But Borisov also vowed to revoke CEZ's license. That's not a great way to woo other foreign investors, who need convincing to come to Bulgaria in the first place.

Elections of a new government may come as soon as late April.

Italy's just-concluded parliamentary elections demonstrated the depth of discontent with the austerity measures and technocratic approach of former Prime Minister Mario Monti. The buffoonish Silvio Berlusconi and his People of Freedom Party and real-life comedian Beppe Grillo and his Five Star Movement both benefited immensely from popular dissatisfaction. While a more fiscally minded, central-left coalition may yet lead a new government, its ability to impose fiscal discipline will be greatly hampered by populist clamor.

Will these kinds of political uncertainties spook potential investors throughout the EU? Stock markets, the barometers of immediate investment sentiment, reacted viscerally to the Italian elections and turned downright splenetic in exchanges from Frankfurt to New York. But that ill humor lasted all of 24 hours. A monthly indicator on EU economic sentiment actually increased more than expected on Wednesday and boosted European equities markets.

It's unreasonable to expect that kind of quick rebound among potential investors in European companies. However, an ability in the EU to absorb these kinds of political shocks may actually give investors an added measure of confidence.

But there's another lesson here, and that's one of choice. The EU contains 27 nations, each one eager to gain investment dollars. With only 7.4 million people and a per capita income of $6,400, Bulgaria pales in comparison to upstart performers such as Slovakia, with a similar population, but with a stable government, a robust middle class and per capita income twice that of Bulgaria.

A cheaper labor force goes only so far.

Italy, by contrast, is Europe's fourth-largest economy and its manufacturing prowess is second only to Germany. Korean, Chinese and Turkish investors have been eager to acquire Italian companies -- especially in food and fashion -- for their brands, their goods, their EU-wide markets and their cache.

That calculus remains unchanged, said investment banker Silverio Davoli, a Milan-based principal with Global M&A Partners, in an e-mail exchange. Investors aren't retreating, he said, although they are "slowing down and waiting" for what happens next politically.

"Oh yes, there's uncertainty, but not yet any definitive change -- up or down -- in investment fundamentals," Davoli believes. "They will improve if we get a (center-left) coalition and reforms, worsen if we don't."

Davoli remains an optimist. "We will (get reforms). It's inevitable," he wrote. "Even Greece did it."