Bulgaria Sticks to Plan to Adopt the Euro in 2024 amid Coalition Squabbles

Bulgaria's government on Friday approved a plan to join the euro zone as of Jan. 1, 2024, amid concerns within the ruling coalition over the lack of detailed analysis on the impact of the move, Reuters reported. Political uncertainty and three elections last year delayed the plan, drafted after Bulgaria was admitted together with Croatia to the ERM-2 mechanism, a mandatory stage for joining the euro in 2020. The European Union's poorest member, which already pegs its lev currency to the euro, has pledged to adopt the single currency at its current fixed rate in 2024. "Bulgaria has, de facto, already adopted the euro through the currency board arrangement. Because of the fixed peg, for example, if we want to raise the interest rates, we cannot do it," Finance Minister Assen Vassilev told reporters. "The plan gives a clear timeline to banks and other payment institutions how the euro will be adopted. It is just a first technical step," he said. The Socialists and the ITN party, members of the four-party ruling coalition, who support in principle the euro adoption, were against the plan's approval. They said there was a lack of an analysis from the central bank on how the euro will impact people's incomes and the economy as a whole. Read more.
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