I Do: Bulgaria Goes To the Altar Despite Jitters Over the Euro

Next year, the poorest member of the European Union, Bulgaria, a Slavic-majority country with deep cultural ties to Russia and formerly one of the most ardent members of the Warsaw Pact, will join the eurozone. 

It’s a big but important step, especially now, say those who joined earlier. 

“Joining the euro area is the best investment Bulgaria can make in its future,” said European Commission Vice President Valdis Dombrovskis, a Latvian. “Given the geopolitical situation in the region and Russia’s war against Ukraine, the euro acts as a shield… Our savings are safe, the currency is stable, and our countries have proven resilient in the face of consecutive economic shocks.” 

Bulgaria’s currency, the lev, has been pegged to the euro since 1999, eight years before the country joined the bloc in 2007. Its monetary policy has not been independent for years, say analysts. So the transition to a new currency there is not fraught with the same level of economic peril as, say, Argentine President Javier Milei’s proposal for his cash-starved country to adopt the US dollar. 

The euro will help eliminate currency conversion costs, improve price transparency, and potentially give more Bulgarians access to cheaper financing and more foreign investment, say proponents. The country has low debt and 2.7 percent inflation, or 0.1 percent less than the high benchmark for eurozone membership. The transition would also signal how Bulgaria has made progress in its decades-long crackdown on corruption, especially in preserving judicial independence and squashing money laundering. 

Bulgarian Prime Minister Rosen Željazkov said the EU’s recent green light for the Balkan country to adopt the euro next year confirmed its progress. “A remarkable day. Another step forward on Bulgaria’s path to the euro… This follows years of reforms, commitment, and alignment with our European partners,” he said on X.

As Chatham House wrote, joining the bloc’s financial union puts euros in circulation, ensuring Bulgarians’ access to solid capital as the US dollar appears poised to lose its status as the world’s reserve currency.

While joining the eurozone will largely be positive in the long run, it nonetheless entails trade-offs, noted the World Economic Forum. For example, Bulgaria must now adhere to eurozone fiscal rules and potentially face more disruption from economic shocks in other eurozone countries. Some observers fear price spikes as merchants and others round up as they convert lev to euros, too, added CNBC.

Within Bulgaria, Eurosceptics and nationalists who often identify with Russia have opposed joining the eurozone, saying it represents a surrender of their sovereignty to foreign bureaucrats. In a May poll, 38 percent of Bulgarians opposed the euro. Only 21 percent wanted to adopt it in January, wrote Yuxiang Lin, a doctoral researcher in Russian, European and Eurasian Studies at the University of Birmingham, in the Conversation.

Meanwhile, thousands of Bulgarians have taken to the streets of the capital, Sofia, and other major cities recently to protest the adoption of the euro and to demand a referendum on the move.

The protesters, led by civic groups and nationalist parties, sang patriotic songs, carried flags of the pro-Russian Vazrazhdane party, and shouted slogans like “Freedom for the Bulgarian lev” and “The battle for the Bulgarian lev is the last battle for Bulgaria,” the Associated Press reported.

President Rumen Radev, who has called for a referendum on the accession date and claimed that Bulgaria’s lack of preparation for the euro may deepen poverty, supports the rallies.

“The protests we’re seeing, the opinion polls, the whole debate over a month now is showing that people want to be heard,” Radev said, according to a report by the public Bulgarian National Radio. “They’re the ones that face the prices which the state obviously can’t cope with.”