Bulgaria could join the euro early in 2022: finance minister

January 28, 2019

SOFIA (Reuters) – Bulgaria’s preparations to join the euro zone are on track and the Balkan country may adopt the euro as early as January 2022, Finance Minister Vladislav Goranov said on Monday.

That is some months earlier than indicated by the EU commissioner in charge of the common currency. Commissioner Valdis Dombrovskis said on Jan. 18 that Bulgaria, which joined the European Union in 2007, would have to wait at least until mid-2022 to join the euro.

But Goranov said he remained hopeful that Bulgaria will be allowed to enter the bloc’s banking union and the ERM-2 mechanism, the two-year obligatory precursor to the euro currency, this summer. Bulgaria’s lev currency is already pegged to the euro.

“I am a moderate optimist that in July, if all goes well with the asset quality review and the stress tests … we will have a reason to apply for ERM entry and will expect a positive result,” Goranov told a public debate on the euro adoption.

“The shortest road to the euro is two years in the ERM-2 and then up to a year for additional adjustments. The most optimistic option to join could be Jan. 1, 2022.”

Dombrovskis, who attended the debate in Sofia, reiterated Brussels’ support for Bulgaria’s path towards the euro zone.

Sofia meets the nominal criteria to adopt the single currency, with low inflation and healthy public finances as well as the currency peg, but is also the EU’s poorest state and also one of the most corrupt.

It also needs to prove its banks are healthy before it can get a green light to join ERM-2 and the banking union. The European Central Bank will carry an asset quality review and stress tests on six Bulgarian banks and is expected to give results in July.

(Reporting by Tsvetelia Tsolova; Editing by Catherine Evans)