site.btaBNB Deputy Governor: Eurozone Membership Gives Bulgaria Strategic Economic Advantage, Voice in Europe's Future

Bulgaria’s accession to the eurozone opens the door for the country to seek strategic economic partnerships such as the one with German industrial giant Rheinmetall, and to participate in building new supply and production chains within the monetary union and the European Union as a whole, Petar Chobanov, Deputy Governor and member of the Bulgarian National Bank’s (BNB) Governing Council, said here on Thursday. He was speaking at an information event within the National Information Campaign on the Introduction of the Euro in Bulgaria.

“The eurozone provides opportunities for both businesses and the State to pursue strategic partnerships. We now have predictability, a shared currency, and reduced transaction costs,” Chobanov said.

He underscored that Bulgaria must rethink its model of foreign direct investment (FDI) from the 2001–2007 pre-EU accession period and instead focus on strategic partnerships in key economic sectors. “The old model must evolve. We must now seek partnerships like the one with Rheinmetall. There are other sectors of the economy where Bulgaria has value to offer and can integrate into the new strategic production and supply chains within the eurozone and the EU,” he explained.

Chobanov pointed out that Bulgaria’s 28 years under a currency board arrangement have resulted in increasing incomes and savings, measured in euro, due to the fixed exchange rate. “Now we have the certainty that this exchange rate level will be permanently preserved. We have safeguarded the wealth that has been growing in the world’s second most important currency,” he noted.

Among the major advantages of joining the eurozone, Chobanov listed greater price and income transparency and comparability, higher financial security, direct involvement in decision-making processes at the EU level. He confirmed that the BNB will continue playing a crucial role in shaping the framework for financial and monetary stability within the euro area.

Chobanov also extended greetings from BNB Governor Dimitar Radev, who was attending his first meeting of the European Central Bank (ECB) Governing Council.

“This is one of the key benefits - our participation in the highest decision-making forums. From a country that used to implement decisions, we are now becoming a country that helps shape those decisions. We will now be working with other eurozone members to define the way forward,” he said.

Addressing public concerns over inflation, Chobanov acknowledged that this is one of the most common fears surrounding euro adoption. He reassured the public that Bulgaria has met the key inflation criterion for eurozone entry in the first seven months of the year. However, he admitted that administered price hikes and food price increases may create a misleading perception of higher inflation.

“Institutions must explain clearly and transparently when and why inflation rises. We need to dispel the myth that inflation automatically results from adopting the euro. That is not true - there are many other contributing factors,” he said. He added that institutions are prepared to take action when they observe unhealthy business or pricing practices. 

Chobanov concluded that the road ahead for Bulgaria is to work with other eurozone countries to solidify the euro’s role as a global currency. “We are entering a new phase where Bulgaria becomes not only a beneficiary but also a contributor to the future of the European economy,” he said.