Sofia, Bulgaria – The Bulgarian government has effectively abandoned its plan to enter the eurozone on January 1, 2026, as Finance Minister Temenuzhka Petkova confirmed that she will not request an extraordinary convergence report from the European Commission and the European Central Bank.
The decision comes as the country narrowly misses the inflation criterion, with its current annual average inflation at 2.6%—just 0.1 percentage points above the required 2.5%.
The move marks a significant policy shift after months of official optimism regarding Bulgaria’s euro adoption prospects.
Despite prior statements highlighting the country’s eurozone “window of opportunity,” resistance from coalition partners—particularly the Bulgarian Socialist Party (BSP) and “There is Such a People”—has hindered a fast-track approach.
GERB leader and former Prime Minister Boyko Borissov, who had previously championed eurozone accession, appears to have relented in the face of political realities.
Finance Minister Petkova painted a grim picture of Bulgaria’s fiscal health, revealing a budget deficit exceeding 3.6 billion leva for the first quarter of 2025.
To mitigate the crisis, she announced plans to withdraw current budget-related laws and resubmit revised drafts by February 14, aiming to curb the deficit to 3% of GDP.
In the interim, the government intends to utilize reserve funds to cover state expenses for January, ensuring the continued functionality of public services.
“The financial situation is more severe than expected,” Petkova stated, attributing the challenges to what she described as “unreasonable policies” implemented over the past three years.
Despite the fiscal turbulence, she assured that social payments remain safeguarded, emphasizing that the government is fully mobilized to stabilize the economy.
Bulgaria’s failure to secure eurozone entry in 2026 effectively delays the country’s adoption of the euro indefinitely. With inflation projected to rise in early 2025, analysts suggest that meeting the euro convergence criteria will become even more challenging.
Speculation had swirled about the possibility of using “creative calculations” to qualify—an approach reminiscent of Croatia’s strategy before its eurozone accession. However, with no extraordinary convergence report request, such measures are now off the table.
The government’s decision is likely to have political and economic repercussions. Business leaders and financial institutions that had prepared for euro adoption may need to adjust long-term plans.
Meanwhile, eurosceptic factions within Bulgaria’s parliament, which have long voiced concerns over rapid currency transition, will view the government’s reversal as a vindication of their stance.
With Bulgaria’s eurozone aspirations now in limbo, attention will turn to how the government addresses its mounting fiscal challenges.
As the administration scrambles to rein in the deficit, questions remain about whether new economic policies will steer the country back toward a sustainable path for euro adoption in the future.
This article was created using automation technology and was thoroughly edited and fact-checked by one of our editorial staff members