Hurried Eurozone Entry Would Have Negative Impact on Bulgaria’s Economy – Deputy PM

Business » FINANCE | July 7, 2015, Tuesday // 10:11
Bulgaria: Hurried Eurozone Entry Would Have Negative Impact on Bulgaria’s Economy – Deputy PM Bulgaria's Minister of Labor and Social Policy Ivaylo Kalfin, photo by BGNES

Bulgaria’s economy is way behind the European average, meaning that if it were to join the eurozone, it would not be good for its economy, according to Deputy Prime Minister and Minister of Labor and Social Policy Ivaylo Kalfin.

In a Tuesday interview for the morning broadcast of the Bulgarian National Television, Kalfin argued that what was happening in Greece was a clear indication of how things would turn out under this scenario.

Kalfin underscored that the single currency required similar economic development levels.

He claimed that Bulgaria’s performance in the sphere of energy efficiency, technological preparedness and staff training was unsatisfactory.

As regards the impact of the developments in Greece on Bulgarian business, he noted that it was an issue for the eurozone to handle, not the EU, adding that Bulgaria was not a eurozone member.

“Greece is a major partner of Bulgaria and it has a more developed economy. In that sense, we have to analyze all of the risks. We are keeping close track of the risks for the Bulgarian economy and we analyze them,” he declared, as cited by the BGNES news agency.

Kalfin argued that the eurozone could go on without Greece, adding that the process would be very difficult because there was no exit mechanism for a single country.

“This will happen if Greece goes back to its national currency. There have been many attempts of this king and they usually lead to bankruptcy,” he stated.

Kalfin commented that the implementation of the pension reform in Bulgaria was a cumbersome and long-term process and no miracles could be expected to happen overnight.

He underscored that the authorities were striving to achieve an increase in pension rates, adding that there was no way that the economy could afford an increase in social insurance contributions.

Bulgaria’s Minister of Labor and Social Policy said that the minimum wage had turned out to be a matter of huge importance to some employers, despite the fact that very few people were paid that amount of money.

“I hope that the Bulgarian economy is not that dependent on cheap labor,” he emphasized.

Kalfin also informed that that the criminalization of the non-payment of social security contributions had resulted in an increase in receipts by over BGN 800 M.

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Tags: Ivaylo Kalfin, Labor and Social Policy Minister, Grexit, Eurozone, pension reform, economic growth
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