Sofia (Bulgaria) (AFP) – Bulgaria will become the 21st country to switch to the euro when it enters the New Year on Thursday, amid concerns the move could usher in higher prices and add to political instability rattling the Balkan country. When midnight strikes on Wednesday, Bulgaria will give up the lev currency, which has been in use since the late 19th century. Successive governments in the country of 6.4 million people have advocated joining the euro, hoping that it will boost the economy of the European Union’s poorest member, reinforce ties to the West and protect against Russia’s influence.
But Bulgarians have been divided over the switch, with many worrying the introduction could exacerbate inflation, which hovers around 3.6 percent. “People are afraid that prices will rise. Today it’s four leva and it will become four euros, while salaries will remain the same,” a woman in her forties who declined to give her name told AFP in Sofia. At one of the largest and oldest markets in the capital, market stalls displayed prices of everything from groceries to New Year’s Eve essentials like sparklers in both levs and euros. “Just like the whole of Europe has managed with the euro, we’ll manage too,” retiree Vlad told AFP as he did some last-minute shopping. “The important thing is that Bulgaria remains in Europe and distances itself from Moscow,” he added.
European Commission president Ursula von der Leyen said Wednesday that Bulgaria’s move into the eurozone marked “an important milestone” that would bring “practical benefits” to Bulgarians. “It will make travelling and living abroad easier, boost the transparency and competitiveness of markets, and facilitate trade,” she said. But Bulgaria, which joined the EU in 2007, faces unique challenges, including anti-corruption protests that recently swept a conservative-led government from office, leaving the country on the verge of its eighth election in five years.
Outgoing Prime Minister Rossen Jeliazkov sought to reassure the public ahead of the switch, saying he was “counting on the tolerance and understanding of both citizens and businesses.” He added that inflation in the Black Sea country was “linked to increased purchasing power” and a less corrupt economy, and not to the looming euro switch.
– Cheers, fears and queues – The concerns of Bulgarians about inflation are not idle. Food prices rose by five percent year-on-year in November, more than double the eurozone average, according to the National Statistical Institute. “Unfortunately, prices no longer correspond to those in levs (…) 40 levs is not 20 but 30 euros for certain products,” pastry shop owner Turgut Ismail, 33, told AFP, saying that prices have already begun surging. A euro protest campaign earlier this year that tapped into a generally negative view of the single currency among much of the population also fanned fears of price increases. According to the latest Eurobarometer survey, 49 percent of Bulgarians are against switching to the euro.
Amid Bulgaria’s political instability, any problems with euro adoption would be seized on by anti-EU politicians, warned Boryana Dimitrova of the Alpha Research polling institute. Some people, including business owners, have complained that it has been difficult to get their hands on euros, with shopkeepers saying they haven’t received the euro starter packages they ordered. Banks said there could be some disruption at cash machines in the hours before the switch. Earlier this week, people queued outside the Bulgarian National Bank and several currency exchange offices in the capital Sofia to obtain euros.
But Lucy, who sells canned vegetables at Sofia market, told AFP that she was already accepting payments in euros and believed that people would quickly get used to the new currency. The euro was first rolled out in 12 countries on January 1, 2002. Croatia was the last to join in January 2023. Bulgaria’s accession will bring the number of Europeans using the euro to more than 350 million.
© 2024 AFP
