Behind an imposing wooden desk in Sofia, in a building that once housed a statue of Lenin, the man who chairs the 20-member group of eurozone finance ministers chooses his words carefully:
“I am firmly convinced that Bulgaria will join the Eurozone in 2025,” said Pascal Donohue. “The question is when it will introduce the euro as a currency. Not if.”
Flanked by Prime Minister Nikolay Denkov and Foreign Affairs Minister Maria Gabriel, his presence carried great European political weight. A month later, the coalition government collapsed and ministers were removed from office. Donohoe’s visit, aimed at bolstering Bulgaria’s faltering bid to become the 21st country to use the euro, came at an inauspicious time.
The experts and politicians who spoke to “Politico” are convinced that the country will not enter the Eurozone on January 1, 2025, as planned so far – not only because of the political turmoil in Bulgaria, but also because of the ongoing inflation and the lack of public support.
“We are in a political crisis,” said MEP Petar Vitanov from the Socialists. This would make it impossible for the country to join the Eurozone by the beginning of the year. The sixth national elections in Bulgaria since 2021 are coming up in June.
“We really don’t know what the next government will be and whether this will be one of its priorities,” he said.
Even before the fall of the government, it appeared that Bulgaria might not meet the planned entry date. The then Prime Minister Nikolay Denkov stated in January that the goal was not cherished. Bulgaria originally intended to join the single currency in early 2024, but last year had to postpone that goal by a year because it did not yet meet the criteria for joining.
According to Chintia Alcidi, senior research fellow at the Center for European Political Studies in Brussels, Bulgaria will be able to join the eurozone in January 2026 at the earliest, given the technical challenges associated with the transition to the new currency.
Several political leaders, including the governor of the BNB, have shared their expectations that the country will enter the eurozone in mid-2025, if the January entry date cannot be met – hence Donohoe’s opinion that Bulgaria will become a member in 2025 ..
Officials and experts dealing with the technical aspects of joining told Politico that entering the eurozone in the middle of the year would be unusual. Countries usually join at the beginning of the year for administrative reasons.
MEP Eva Maydel of the center-right EPP group said she was optimistic that Bulgaria would join in 2025. She added that it could happen on January 1, but it could happen later.
Affected by rising prices
Joining the eurozone is a process where countries are assessed by the European Central Bank and then EU finance ministers, MEPs and heads of government discuss the matter.
Convergence criteria that a country must meet to qualify include a stable exchange rate, meeting government deficit and debt ratio targets, and bringing national legislation into line with EU law.
The next ECB report on Bulgaria, which will determine whether it is ready to join, is expected before the summer.
Inflation continues to be a problem. To adopt the euro, Bulgaria needs an average inflation of no more than 1.5% above the level of the three “best performing” EU countries – a vague criterion that does not give a precise answer about the amount of inflation needed.
The last country to join the Eurozone in 2023 was Croatia. It benefited from selective data selection when it was allowed to join despite the higher inflation rate.
“The only obstacle for Bulgaria is the inflation criterion,” said Zholt Darvash, senior research fellow at Bruegel. “It is in a good budgetary position – low public debts and budget deficits under control”.
“The country’s current forecast of 2.9% inflation in 2025 suggests that Bulgaria will be able to join in 2026,” Darvash said. He added that there is a chance that the same reasons that allowed Croatia to join in 2023 could be used to shorten the deadline for Bulgaria’s accession, but this must be justified.
In theory, Sofia will request a new convergence report from the ECB by the end of this year, which will have low enough inflation to be able to join in mid-2025. But in practice, EU officials who will be involved in the technical process , question whether this would be possible.
Russian disinformation
Among the political class in Bulgaria, membership of the Eurozone was easily accepted. But the public is proving more difficult to convince.
In a Eurobarometer survey last year, Bulgarians expressed lower-than-average support for accession and higher-than-average concern about issues such as price-fixing during the transition.
Senior EU officials told Politico that disinformation coming from Russia contributed to this attitude.
“I still believe that the majority of Bulgarians would prefer to be part of the Eurozone,” said MEP Vitanov. “Here I am not only blaming Russian propaganda. Yes, it exists. But in general, those who lag behind are the Bulgarian politicians”.
Apart from the results of lower inflation, Bulgaria is in a relatively strong position to join the eurozone, several experts and officials said.
The country’s currency – the lev, has been tied to the euro since 1999, and Bulgaria has been in the EU banking union since 2020 – steps which, according to MEP Maydel, show a very, very strong desire to join.
Last month, the country also received approval from the Eurozone countries, when the rulers praised Bulgaria’s progress.
But despite the EU’s enduring public support for the January 2025 target, senior officials admit it is unlikely to be met.
As one of them says, “It’s off.”
