Bulgaria is preparing to adopt the euro, but not everyone in the country is on board. While the government considers eurozone membership a priority, many citizens remain skeptical about the move, citing fears of rising prices and a loss of monetary sovereignty. CNBC explored the growing divide in public opinion, highlighting both the promises and the concerns surrounding the country’s planned transition to the single currency.

Prime Minister Rosen Zhelyazkov views joining the eurozone as an important step toward greater economic stability and development. However, opposition is growing, fueled by nationalist forces that warn of negative consequences. According to a recent EU-wide survey, around half of Bulgarians oppose the adoption of the euro. Protests have already erupted, driven by fears that the currency changeover could lead to a jump in prices and weaken national control.

Valentin Tataru, an economist at ING, explains that people are mainly worried about the cost of living going up during the transition, as some businesses may use the change to round up prices. This is particularly concerning for residents of poorer and more rural regions. However, Tataru points out that Bulgaria’s fixed exchange rate should soften the inflationary impact, preventing dramatic price shifts.

Another frequently mentioned concern is the perceived loss of sovereignty. The lev has become more than just a currency - it’s seen as a symbol of independence. Abandoning it, warns Andrius Tursa, a Central and Eastern Europe advisor at Teneo, could be politically and emotionally sensitive for many. He also notes that joining the eurozone would mean Bulgaria giving up a degree of control over monetary policy, as decisions would shift to the European Central Bank (ECB).

At the same time, both Tursa and Allianz senior economist Jasmine Gröschel emphasize the advantages of membership. Tursa explains that eurozone countries benefit from lower interest rates due to the ECB’s credibility, which makes borrowing cheaper for individuals and businesses. Gröschel agrees, adding that ECB supervision could increase economic resilience and growth potential.

Foreign investment is also expected to rise as Bulgaria integrates more deeply with the euro area. According to Gröschel, deeper financial integration and oversight from the ECB would strengthen the financial system and provide greater monetary stability. In her view, adopting the euro would not only reinforce Bulgaria’s position within the EU, but also enhance the country’s credibility on the international stage.

Tursa further notes that the euro would help reduce costs and barriers related to currency exchange, a development that could particularly benefit trade and tourism. Since the EU is already Bulgaria’s main trading partner, joining the eurozone could streamline transactions and improve efficiency across sectors. This is especially relevant given Bulgaria’s close integration in European supply chains.

Still, political risks remain. Tursa warns that public dissatisfaction over the euro could drive more support toward populist and Eurosceptic parties. Protests have already shown that the issue carries emotional weight and could become a divisive force in the country’s political landscape.

Even so, economists like Gröschel believe that the long-term benefits of joining the euro outweigh the downsides. While Bulgaria will lose some economic autonomy and face strict fiscal rules, she argues that the gains - such as greater financial stability, lower transaction costs, and closer ties with EU markets - make the transition worthwhile. ING’s Tataru echoes this sentiment, noting that the lev’s long-standing link to the euro suggests the shift should be relatively smooth.

Source: CNBC