site.btaParticipants Discuss Benefits and Challenges for Bulgaria Adopting Euro

The benefits and challenges Bulgaria faces on the road to adopting the euro were discussed by Liliana Pavlova, Asen Yagodin and German Ambassador to Bulgaria Irene Maria Plank at the fifth edition of the Sofia Economic Forum on Monday.

Lilyana Pavlova, former Vice President of the European Investment Bank (EIB), pointed out that Bulgaria's entry into the euro area will benefit the whole region, not just the country. According to her, the adoption of the euro is a matter of strategic decision, which will positively influence Bulgaria's development after joining the European Union.

Pavlova expressed confidence that the country would be ready for eurozone accession on January 1, 2026. In her words, when it comes to euro area membership, this means sharing prosperity, strengthening fiscal stability, increasing investor confidence and stabilizing the banking system. She noted that euro area membership would contribute to the positive image of the region as a good place for growth and economic development. In her view, this is a policy that ensures that there are no losing sides in this process.

Pavlova stressed the need for reforms, maintaining fiscal discipline and conducting a large-scale information campaign by the government. This campaign, she said, should be aimed at tackling misinformation about the changeover from the lev to the euro, and should be conducted in cooperation with the private sector. "We are already a member of Schengen and now is the right time to join forces so that we do not miss this opportunity," she urged.

Pavlova drew attention to the importance of analyzing the challenges so that key elements are not put at risk. She gave the example of the need for strategic balanced budgeting and fiscal discipline, because compliance with the Maastricht criteria is not an instantaneous process. She pointed to the lack of a clear agenda for reforms and modernization of the administration as well as digitalization, which are key in the context of euro adoption. She said small and medium-sized enterprises would need programmes and training to prepare for the changeover.

Asen Yagodin, Deputy CEO of Corporate Banking and Capital Markets at Postbank, pointed out that the banking system in Bulgaria is ready for the adoption of the euro. In his words, the pegging of the lev to the euro means in practice that Bulgaria is already partially integrated into the euro area, but does not benefit from all the advantages of the common currency. He pointed to the abolition of currency conversion fees and currency transfers as particular benefits.

By adopting the euro and joining the richest EU countries, a strong message will be conveyed to investors that they can invest more and more confidently in Bulgaria. This will enable Bulgarian companies and banks to receive more favourable financing terms from European markets, Yagodin added.

Germany's ambassador to Bulgaria, Irene Maria Plank, pointed out that if Bulgaria meets the convergence criteria, it should join the euro area. According to her, this will increase Bulgaria's exports.