Bulgarian Economist: Window for Eurozone Membership is Closing Amid Shifting European Politics

Business » FINANCE | January 31, 2025, Friday // 13:25
Bulgaria: Bulgarian Economist: Window for Eurozone Membership is Closing Amid Shifting European Politics Nikola Yankov

Economist Nikola Yankov, a former deputy minister of economy in Bulgaria and currently leading the economic team of the "Blue Bulgaria" party, expressed in an interview with the National Radio, concerns about the current political and economic direction in the country. He believes that the real reason for postponing the request for an extraordinary assessment from the European Commission regarding Bulgaria's eurozone membership is the ruling coalition’s intention to submit a budget with a deficit exceeding 3%. According to Yankov, this short-sighted policy sacrifices the country's strategic goals for political stability in the short term.

Yankov warned that Bulgaria's chance to join the eurozone might close within this year, as the political landscape in Europe is rapidly shifting. He pointed to the rise of populist parties with anti-European ideologies, which could pose a significant threat to Bulgaria’s integration with the European Union. He emphasized that this delay in pursuing eurozone membership might be the last opportunity for Bulgaria, warning that the country’s European perspective has been under attack in recent years.

The economist reaffirmed that Bulgaria meets the criteria for joining the eurozone, noting that even Croatia was accepted despite not fully complying with all the requirements. He criticized the lack of active efforts from Bulgaria's National Assembly to push for eurozone membership, claiming that anti-eurozone sentiment is being fueled by a lack of information campaigns, despite significant funds being allocated for such initiatives. Yankov argued that Bulgaria’s future is intertwined with its commitment to the West, asserting that joining the eurozone would secure the country’s position geopolitically within the orbit of Western democracies, thus preventing a regression into Soviet-style influence.

On the economic benefits of eurozone membership, Yankov claimed that it would lead to immediate prosperity, with the valuation of Bulgarian assets such as properties and companies surging. He explained that while these benefits might sound abstract, they would result in real financial gains for Bulgarians, yet warned that many citizens are misinformed and influenced by misleading narratives.

Regarding the country’s fiscal policies, Yankov expressed disappointment over the government's failure to implement cost-cutting measures. Instead, he criticized the administration for proposing new subsidies for businesses, raising pensions beyond the Swiss rule, and continuing populist policies like the continuation of COVID-era support for restaurateurs. He warned that Bulgaria no longer has the reserves to maintain such spending, questioning the long-term viability of these policies.

Yankov also addressed the ongoing debate over the potential sale of Lukoil's Bulgarian refinery, dismissing the idea of nationalizing the refinery. He argued that the Bulgarian state does not need to assume operational control of the refinery, as it operates as a private enterprise. He reassured that the state already has control over the approval process for any potential buyers, especially those from outside the EU, as the purchase of assets in strategic sectors requires government approval. According to Yankov, the government can effectively regulate the ownership of such assets, and any concerns regarding foreign buyers are exaggerated.

Yankov questioned the direction of Bulgaria’s politics, suggesting that the country faces an important crossroads: continue down a populist path or embrace deeper integration with Europe. He warned that the window for the eurozone membership might be closing, and further delays could put Bulgaria's future European integration in jeopardy.

Source: BNR

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Tags: euro, Bulgaria, Yankov

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