site.btaFinance Minister: Bulgaria Is Expected to Request Extraordinary Convergence Reports on Eurozone Entry Date by Year’s End

By the end of the year Bulgaria is expected to request extraordinary convergence reports from the European Commission and the European Central Bank on a date for Eurozone accession, said Finance Minister Lyudmila Petkova.

Petkova said that at the end of the year Bulgaria is expected to meet the last criterion for eurozone membership. 

During Question Time in Parliament she recalled that according the reports of the European Commission and the European Central Bank out of the four criteria Bulgaria has failed to meet only that for inflation. 

In her words, the expectations are that by the end of the year it will be fulfilled and in that case Bulgaria has the right according to the Treaty on the Functioning of the European Union  to submit a request for the preparation of extraordinary convergence reports to the ECB and the EC, after which the EC prepares a request with a draft decision of the Council of the EU for consideration and approval of a date for joining the euro area, Petkova said.

She said that there are two more criteria to be met in connection with Bulgaria joining the ERM II mechanism in 2020.

They are related to four areas - non-bank financial sector, insolvency legislation, anti-money laundering legislation and legislation for the governance of state-owned enterprises. The measures are implemented at 94%, leaving two, related to state-owned enterprises and the requirements of the Public Enterprises Act, the Finance Minister said.

One requirement is to bring the boards of state-owned enterprises in line with the requirements of the Public Enterprises Act, with 196 out of 266 state-owned enterprises brought into compliance to date.

The EC has found that once the boards of the state-owned enterprises have been appointed through competitions, they should not be continuously changed, and in principle, if there is a change, the requirements of the Public Enterprises Act should be respected, otherwise the Commission considers that Bulgaria is not fulfilling its own law, which it has adopted, Petkova said. 

She added that the second requirement is the adoption of a transformation programme for state-owned enterprises. An analysis was prepared in 2021 and a pportion of them should be restructured into commercial companies or administration. Discussions are currently underway with the relevant ministries that are the principals of the state companies, the Deputy Prime Minister said.