Staff Report
Bulgaria officially joined the eurozone on Thursday, making it the 21st nation to adopt the common currency, nearly two decades after its entry into the European Union. The transition, marked by the projection of Bulgarian euro coins onto the central bank’s facade at midnight, signifies a deeper integration with the West for the Balkan country. While leaders like European Central Bank President Christine Lagarde lauded the euro as a “powerful symbol” of shared values and collective strength, the move has been met with a decidedly mixed public reception within the country of 6.4 million people.
Successive Bulgarian governments have long championed euro adoption, viewing it as a critical step to bolster the economy of the EU’s poorest member, fortify ties with Western Europe, and act as a bulwark against perceived Russian influence. President Rumen Radev, in a New Year’s Eve address, hailed the adoption as the “final step” in Bulgaria’s EU integration, even as thousands braved freezing temperatures in Sofia to celebrate the new year. However, Radev also voiced regret that the public was not given a referendum on the euro, describing this omission as a symptom of the widening chasm between the political establishment and its citizens, a divide underscored by recent mass protests.
The public’s apprehension is not unfounded. A recent Eurobarometer survey indicated that 49% of Bulgarians oppose the switch, largely driven by concerns that the euro could trigger higher prices and exacerbate the nation’s already volatile political landscape. Bulgaria has seen eight elections in five years, with anti-corruption protests recently ousting a conservative-led government. Inflation remains a significant worry; food prices in November rose 5% year-on-year, more than double the eurozone average, according to the National Statistical Institute. This economic reality fuels fears among citizens and small business owners alike.
Shopkeepers, for instance, have reported difficulties in obtaining euro starter packages they ordered, complicating the transition for daily commerce. At one of Sofia’s largest markets, stalls already display prices in both the lev, which has been in use since the 18th century, and the euro, illustrating the immediate impact on everyday transactions. Turgut Ismail, a 33-year-old pastry shop owner, observed that prices have already begun to surge, lamenting that they “no longer correspond to those in levs.” This sentiment underscores a broader skepticism, with some business owners and citizens finding the timing of the adoption less than ideal.
The long-term economic implications, however, present a more complex picture. Petar Ganev, a Senior Research Fellow at the Institute for Market Economics, suggests that the primary benefit will be a boost in confidence regarding the currency’s purchasing power, attracting foreign investors and improving Bulgaria’s credit rating. Historically, credit agencies have deducted from Bulgaria’s rating due to its currency board arrangement. European Commission President Ursula von der Leyen also highlighted the practical advantages, stating that the euro would simplify travel, enhance market transparency and competitiveness, and facilitate trade for Bulgarian citizens.
Despite the prevailing anxieties, some citizens express cautious optimism. Retiree Vlad remarked, “The whole of Europe has managed with the euro, we’ll manage too,” reflecting a belief in the eventual normalization of the new currency. The design of Bulgaria’s euro coins also weaves in national heritage, featuring the Madara Rider, a UNESCO World Heritage site, on the one, two, five, 10, 20, and 50-cent pieces. The one-euro coin depicts Saint Ivan of Rila, a revered 9th-century hermit, while the two-euro coin honors Paisiy Hilendarski, an 18th-century monk credited with a pivotal work in Bulgaria’s national revival, with the inscription “God protect Bulgaria” etched on its edge. These cultural touchstones may serve as a reminder of national identity amidst this significant economic shift.
