PM Petkov on Bloomberg: "Bulgaria Fully Committed to Adopt Euro in January 2024"

NW 11:15:02 06-01-2022

PM Petkov on Bloomberg: "Bulgaria
Fully Committed to Adopt
Euro in January 2024"

Sofia, January 6 (BTA) - Bulgaria is fully committed to adopting the euro on January 1, 2024, understands the benefits of this move and will make sure everybody understand them, Prime Minister Kiril Petkov said in an interview on Bloomberg.

"I come from business, and I fully understand the benefits of the eurozone. [...] Bulgaria is fully committed for making this step. What has to be done and what the Finance Minister said very clearly is that it cannot be done out of the blue. We have to prepare a big information campaign, so we don't create the same problem we currently see with the vaccines. When it is not communicated well and is forced or pushed on the population, there is a risk of political turmoil that should not be there," said Petkov.

He said the Government has to be careful with the communication and it has to start early. Also, it has to speak with the different stakeholders about practical things such as for how long the small shop nextdoor needs to have two cash registers, in leva and euro, what the accounting will be like, etc.

"When we do the transition, we need to make it as smooth as possible," Petkov said.

He also said that part of his work at Harvard Business School involved the effect on prices from the adoption of the euro, and it was clear that there is no real inflation created by it, around 0.3 per cent, mostly caused by the rounding up of prices.

He does not see the euro zone inflation as a risk for his country and argues that it is the normal outcome of the policies during the pandemic and all the additional funding. "Its normal when you increase the money supply without increasing the GDP to create inflation. So, that has happened in all European countries, that has happened in Bulgaria."

He added that Bulgaria had "a small additional factor": the Government made sure there is no pensioner below the poverty line by increasing the lowest level of pensions.

"We have to monitor this effect carefully, but I believe there is no systemic issue that creates a risk for Bulgaria," the Prime Minister said.

"For us it should be a fairly easy transition. We are already pegged to the euro and we are keeping the peg," he said. LN