IMF Director Urges Bulgaria Not to Miss Euro Adoption Chance

Business » FINANCE | April 16, 2024, Tuesday // 17:01
Bulgaria: IMF Director Urges Bulgaria Not to Miss Euro Adoption Chance

In a recent interview with BTA, Kristalina Georgieva, Managing Director of the IMF, emphasized the importance for Bulgaria to seize the opportunity to adopt the euro, stressing that it is achievable with the right political will.

Georgieva expressed optimism about Bulgaria's prospects, highlighting the need to meet the eurozone entry criteria, particularly regarding inflation levels. She underscored the detrimental impact of inflation on citizens, especially the economically vulnerable segments of society.

Despite the upcoming elections, Georgieva noted bipartisan support for euro adoption among Bulgarian politicians. She urged Bulgaria not to squander this chance, emphasizing the unity surrounding the issue.

Addressing concerns about Bulgaria's participation in the euro without influence over its monetary policy, Georgieva emphasized the benefits of alignment with the European Central Bank's policies. She questioned the rationale for consuming policies in which Bulgaria does not participate actively.

Georgieva echoed the IMF mission's recommendation to replace Bulgaria's flat tax with a progressive one, citing the potential for increased contributions to workforce quality and infrastructure development.

Reflecting on global tax trends, Georgieva suggested that the initial decision to implement a flat tax in Bulgaria served its purpose at the time. However, she emphasized the need for tax rate differentiation in line with evolving institutional frameworks.

Regarding central bank policies, Georgieva anticipated varying approaches among leading central banks, with potential rate cuts by the Bank of England and the European Central Bank ahead of the US Federal Reserve. She attributed this divergence to differing economic conditions across regions.

Georgieva's remarks underscored the urgency and opportunity for Bulgaria to pursue euro adoption, emphasizing the need for strategic economic policies aligned with global trends.

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Tags: Georgieva, Bulgaria, euro, inflation

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