A week until the final decision on the euro – are there any question marks?

Both opponents and supporters of the euro agree that the decision is rather political

published on 7/2/25 9:50 AM

Photo: Reuters

Exactly a week remains until the final decision on Bulgaria's entry into the eurozone – on July 8, the European Parliament is to vote on whether Bulgaria will become the 21st member of the eurozone and adopt the single European currency from January 1, 2026. This is the last and final step, after the European Central Bank issued a positive report on Bulgaria's progress and the implementation of the so-called Maastricht convergence criteria – for inflation, government debt and deficit as a percentage of gross domestic product, long-term interest rate and exchange rate stability against the euro.

And although the outlook is now clear, nothing is final until the final step is taken. "Anyone who has dealt with this at least a little knows that there is no predestination - until the last moment, when someone makes an assessment, many things can happen," said to Radio Bulgaria the member of the Fiscal Council and former Deputy Finance Minister Lyubomir Datsov:

"So far, there is no reason to believe that anything has changed and after the positive professional opinion of the two convergence reports of the European Commission and the European Central Bank, the political process can be hindered. That is, there is no reason for this to happen. Bulgaria deserves it, it has walked the path to be in the eurozone. And when someone asks - are we ready? This is determined by the EC and the ECB and they said that we have fulfilled the formal criteria for entering the eurozone."

The risk of price speculation is rather a result of the "inflated" expectations in public opinion, which, however, ultimately result in a real increase in prices, Datsov believes:

"I have always said that the policy that is being implemented should be much more pronounced. For many years in Bulgaria we have been doing, as I call it, a "border policy", i.e. the policy covers the standards, but by a little. And this is not from now, but has been like that for years. But we sufficiently and sustainably cover these standards and no one should doubt that Bulgaria covers the criteria. But I think that we need to run faster, i.e. the speed of reforms should be the one with which we run, it should be greater. For example, with the budget, because fiscal policy is a matter of compliance with a certain type of rules."

Inflation exists, but the reason why it is not so high is rooted in the fact that we are part of the single European market, he believes. It is not internal policy and factors, but quite the opposite - external factors that stabilize these processes, Datsov believes. ‎

‎"Bulgarians are definitely getting richer, but at the same time, the feeling of uncertainty increases. Many people think that the presence of dynamics is something positive, but it creates precisely this feeling of uncertainty. Therefore, from a purely managerial perspective, I would reduce the dynamics - for example, this pressure on salaries in the budget spheres, I personally would reduce it, because this is the reason for some of these feelings," added the economist. ‎

It is completely normal and understandable that the decision for the eurozone is more political than economic, believes financial expert Datsov. Stoyan Panchev, co-chair of the Expert Club for Economics and Politics (EKIP), is of a similar opinion.‎

‎"At this stage, I think it is absolutely clear that Bulgaria does not meet the criteria - both the inflationary and the deficit-related ones. And the fact that institutions such as the ECB and the EC were closed to this matter confirms it." ‎

But even according to Panchev, who is an opponent of the introduction of the euro in Bulgaria, Bulgaria's entry into the eurozone is almost certain. ‎

‎"Question marks remain, but the probability of having a positive response to the report is indeed high. The question is whether there will be some political decision that will postpone Bulgaria's entry, but this is unlikely," added the co-chair of the EKIP.‎

The political decision has been largely foretold. It is also a fact that half a year before the official payment in euros in Bulgaria becomes a reality, people are already feeling concerns about a possible increase in prices and the financial inability to meet basic expenses. At the moment, both economists, although one is "for" and the other "against" the euro, have a consensus on one issue - the state, despite loud claims that it will fend off any speculation, is unlikely to be able to cope.

English publication: R. Petkova
Photos: Ройтерс, BTA, weforum.org, BGNES

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