site.btaUPDATED Bulgaria Expects to Meet Inflation Criterion for Eurozone Entry by End-2024 - Finance Minister

Addressing a parliamentary hearing here on Thursday, caretaker Deputy Prime Minister and Finance Minister Lyudmila Petkova said that of all six Member States under consideration, Bulgaria is most advanced on its road to the introduction of the euro and has achieved substantial progress in meeting the convergence criteria.

With regard to compliance with the Maastricht criteria, according to the convergence reports of the European Commission (EC) and the European Central Bank (ECB) that were published on Wednesday, Bulgaria is the only country that meets all criteria except price stability, Petkova said.

She added that the inflation criterion is expected to be fulfilled, too, until the end of 2024, which will address the last hurdle to Bulgaria's entry into the eurozone, the Finance Minister said. After the price stability criterion has been met, Bulgaria will request the EC and the ECB to draw up specific reports, on the basis of which a Council decision on the country's membership in the eurozone could be adopted as soon as possible, the Deputy PM added.

She noted that during its term the caretaker Cabinet continued the vigorous work on the country's practical preparations for the euro changeover, and the Euro Introduction Bill that the Council of Ministers approved at its meeting on Wednesday is part of the progress achieved. Petkova pointed out that the caretaker Cabinet also carried out the implementation of the updated communication strategy on accession to the eurozone.

In a declaration on behalf of his parliamentary group, Vazrazhdane leader Kostadin Kostadinov insisted that any request by the government for a ECB specific report regarding Bulgaria's admission to the eurozone be referred for preliminary debate and resolution to the National Assembly.

The declaration was prompted by the EC and ECB convergence reports which said that Bulgaria will not introduce the euro on January 1, 2025. 

Kostadinov argued that such referral to Parliament "would be a manifestation of basic democracy and sovereignty because it concerns a decision of historic and hazardous and dangerous consequences for our country's future."

"Vazrazhdane will continue to insist that the process of negotiations with the EC and the ECB on the ruination of the Bulgarian lev finally become public and legitimate because at this point it is covert and illegitimate," the declaration says.

"A rogue procedure for destruction of Bulgaria's financial independence is underway," Vazrazhdane declared. "In this connection, we move and will insist that the Euro Introduction Coordination Council, together with all its working groups, at last start publishing the minutes of its meetings and all meetings be livestreamed and their transcripts be made public," Kostadinov said.

"We have detailed ECB President Christine Lagarde, familiarizing her personally with the problems of Bulgarian statistics, the public moods and the resistance in defence of the Bulgarian lev and the currency board arrangement, the problems expected with meeting the budget deficit criterion and the new legislation adopted in Bulgaria that has not been duly coordinated with the ECB," the Vazrazhdane leader said.

Jordan Tzonev MP of the Movement for Rights and Freedoms countered that the euro adoption process is making progress as scheduled. In his words, the EC report will be updated in September or October and by that time Bulgaria will have met the inflation criterion. "The Bulgarian lev is stable because it is pegged to the euro and not to the rouble, and the euro will become an official currency in this country," Tzonev pointed out.

Martin Dimitrov MP of Continue the Change - Democratic Bulgaria (CC-DB) argued that Vazrazhdane insinuated falsely that there is no such thing as specific convergence reports: Latvia requested one in 2013. "When Croatia adopted the euro, it had the highest income growth in the EU: that is why you oppose the eurozone, because you don't want Bulgaria to succeed that way," he said, addressing the Vazrazhdane Parliamentary Group.

"Unless the effort is expressly sabotaged and the caretaker cabinet is part of that sabotage, it is quite realistic that Bulgaria will join the eurozone next year," Dimitrov said. 

According to Sofia Municipal Councillor Deyan Nikolov of Vazrazhdane, Bulgaria will not enter the eurozone on January 1, 2025 but will not be ready for that for many years ahead. "Even the greatest optimists regarding Bulgaria's economic indicator can hope for this to happen in the coming six, eight or ten years," he emphasized.

"July 1, 2025 is a completely realistic date for Bulgaria's eurozone entry," CC-DB MP Assen Vassilev said, commenting on the hearing of his finance minister predecessor Lyudmila Petkova.  

"It also emerged that, according to the convergence report on Bulgaria's admission to the eurozone that was released yesterday, Bulgaria for the first time does not meet a single criterion: price stability. All previous reports noted problems with legislation. Last year, thanks to Parliament's work, we managed to adopt all requisite laws," Vassilev added.

In his words, Bulgaria has been failing to meet the inflation criterion since 2018. He expects the country to meet this criterion until the end of this year at the latest, so as to request a specific report and be enabled to join the eurozone by 2025.

"I would like to ask part of the political leaders, and in particular Mr Boyko Borissov, who I don't know whether he is unaware or pretends to be unaware, to stop speculating about this subject that is so important for Bulgarian citizens," Vassilev said.