site.btaFinance Minister: Euro Adoption Will Be at Risk if Awareness Campaign, Analyses Delay Technical Preparation

The parliamentary budget committee decided Thursday to leave for its next sitting a discussion on the plan for the adoption of the euro. Finance Minister Assen Vassilev warned that delaying the technical preparation for entry in the euro zone for the duration of an awareness campaign or for preparation of analyses, would put to question the adoption of the euro as planned.

Bulgaria has declared plans to adopt the euro on January 1, 2024.

MP Lyubomir Karimanski (There Is Such a People) reiterated what he had been saying repeatedly: that it is essential to explain to people the benefits and risks from the adoption of the euro. He proposed that a strategic analysis, which the central bank is expected to prepare, be submitted by the end of July.

Bulgarian National Bank (BNB) Governor Dimiter Radev said that it is important to define clearly what this analysis should include, because the central bank may fail to meet the July 31 deadline.

Finance Minister Vassilev said that a lot of technical work needs to be done and over 100 pieces of legislation adoption, including revisions to the BNB Act, if the target date for the adoption of the euro is to be met. “Parliament’s failure to carry through these revision bills would halt the adoption of the euro. In addition to being politically ready, we also need make sure all state institutions that are involved in the adoption of the euro, are technically prepared. That is enshrined in the operational plan for the adoption of the euro, published in July 2021".

He said that the technical preparation does not have to interfere with an awareness campaign.

“If six months from now we decide to adopt the euro at the start of 2024 but we have not started the technical preparation, the adoption of the euro would be at risk,” Vassilev said.

BNB Governor Dimiter Radev said that the risks and benefits from the adoption of the euro should have been discussed "at the start of the process", not at its end. He said that while a lot remains to be done before Bulgaria adopts the euro, including legislative steps, the political situation has dramatically changed since Wednesday.

On Wednesday, the government lost its majoriy support in Parliament after There Is Such a People pulled out its four members in the coalition government.

BNB is part of the European Central Bank supervisory mechanism and participates on an equal footing with the others. “In other words, BNB is already part of the euro zone and Bulgaria makes decisions along with the other countries in it,” he added. “The business cycle in Bulgaria is largely synced with the EU. We are more advanced in this department than some euro zone countries and we already have a high level of synchronization,” Radev also said.