„About 85-90% of the leva are already out of circulation. There were isolated technical problems in the first weeks, but they were quickly overcome“. This was stated on bTV by Petar Ganev, senior researcher at the Institute of Market Economics, almost two months after Bulgaria entered the eurozone.
The expectations are that between 2 and 3 billion leva will remain outside the banking system - saved “in mattresses“, lost or simply retained by citizens. A similar process is observed in other countries that have adopted the euro.
The data show monthly inflation of about 0.6-0.7% in January, with the growth in services - restaurants, hair salons and others - being more noticeable (about 1.6%).
„Rounding is easier there. In large chains and in mass consumption goods, a similar effect is almost not visible“, explained the economist.
Annual inflation is slowing to about 3.5%, the reason being the high base from the beginning of last year, when there was a serious price shock due to increases in VAT and utilities.
Despite official data, some people claim that the consumer basket has become noticeably more expensive.
“Everyone has their own personal consumer basket. What we buy every day – food and lunch out – is most noticeable. If electricity does not increase in price, but lunch with colleagues increases, that is what will impress us“, commented Ganev.
According to him, the public tension in recent months has not been provoked mainly by prices, but by other accumulated problems.
After the pandemic, salaries in our country have been rising at double-digit rates - 15-17% per year, and this year the growth is expected to slow to about 10%.
“With the exception of the end of 2022 and the beginning of 2023, during the rest of the period, salaries have been ahead of inflation“, the expert pointed out.
However, the increases are not uniform. There were more serious growths in the public sector, especially in the security sector, which creates a feeling of imbalance compared to the private sector.
The difference between Sofia and the rest of the country continues to be significant. However, outside the capital, the differences between the individual regions are not so dramatic.
„Larger regional centers such as Plovdiv, Varna, Burgas and Veliko Tarnovo are attracting population and this is felt. The demographic picture in these cities shows an upswing“, Ganev noted.
Bulgaria is gradually losing its image as a destination for cheap labor. Some of the investors, attracted mainly by low wages, are already leaving the country, Ganev also believes.
„This means that we need to look for new competitive advantages – better education, higher added value, energy security“, the economist commented.
According to Petar Ganev, the caretaker government has responsibilities not only for holding elections, but also for financial stability.