The euro zone is ready for a new member: Bulgaria

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The euro zone is ready for a new member: Bulgaria

A worker counts Bulgarian Lev banknotes at a store in Sofia, Bulgaria, on Friday, March 29, 2024.

Oliver Bunic/Bloomberg via Getty Images

Bulgaria on Wednesday secured the green light to join the euro zone, meaning the bloc could soon grow from 20 to 21 members.

A European Central Bank

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assessed that the country met the requirements to adopt the single currency starting next year.

“This positive assessment of convergence paves the way for Bulgaria to introduce the euro as of 1 January 2026 and become the 21st EU Member State to join the euro area,” Philip Lane, member of the ECB Executive Board, said in a press release.

This marks a shift from last year’s report, which concluded that Sofia did not meet the so-called convergence criteria to adopt the currency on the grounds that the country’s inflation rate was too high.

One of the obstacles to cross was inflation. Bulgaria’s harmonized consumer price index — which is comparable across European countries — came in at 2.8% in April according to statistics agency

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.

Price stability is just one of the requirements a country needs to fulfil in order to join the euro zone, and thereby the European Central Bank. Others include limitations on the size of a nation’s government deficit and debt ratio, its average nominal long-term interest rate and its exchange rate stability.

There is also a legal requirement that covers central bank independence.

Bulgaria joined the European Union in 2007 and committed at the time to also join the euro zone and relinquish the Bulgarian lev as its official currency.

One euro is equivalent to 1.96 lev, a rate set when Bulgaria became part of the board which anchors the currencies.

There are mixed attitudes about joining the euro within Bulgaria. A

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published last year by the EU suggested 49% of the

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was in favor of the becoming part of the euro bloc. Political opinion is also split, with several nationalist parties and the country’s president advocating against it, while Prime Minister Rosen Zhelyazkov is supportive.

This developing story is being updated.

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