The eurozone offers us better protection against crises and populism, said BNB Governor Dimitar Radev in an interview with Kapital, after the positive reports of the European Central Bank and the European Commission were published.
Bulgaria received a positive assessment of its readiness for the eurozone from the ECB and the EC - something you have been actively working on for a long time. Is there anything from now on that could prevent the transition from the lev to the euro from happening on January 1, 2026?
Behind this result are significant efforts on many fronts, most of which remain out of the public eye. I see no real obstacles to the successful finalization of the process. However, nothing is final until the official decision of the Council of the European Union is made, which is expected at the ECOFIN meeting scheduled for July 8.
President Rumen Radev tried to initiate a referendum on whether the entry should be from next year, arguing that the institutions have not done their job well and that “there is no consensus in Bulgarian society regarding our readiness to introduce the single European currency, nor the date on which this will happen“. In this situation, we cannot help but ask you, are we ready?
There is hardly another topic where readiness can be measured so objectively and specifically. The competent institutions in Bulgaria, including the BNB, assessed that the country is fully prepared. We have already received the same assessment from the ECB and the European Commission. No less important is that business, unions, academia and the non-governmental sector have also clearly expressed their support and readiness.
However, we know that the technological and logistical complexities are not negligible, so is there anything that worries you in the preparation?
From a technological and logistical point of view, this is indeed an extremely complex process that we have been working on for years. As for the BNB - our technical and logistical infrastructure is already fully built. This includes information, payment, accounting and statistical systems; a modernized system of cash centers; exchange infrastructure; a new fleet of armored and security vehicles; all necessary machinery, equipment, licenses and certificates - including for minting Bulgarian euro coins. Immediately after the Council's decision, we are starting the final preparations at full capacity.
Do public attitudes and political calls for mass protests and battles to save the leva worry you?
This depends to a crucial extent on the political parties and their leaders. Such historical moments are a test for statesmen. The political legacy of many of today's politicians will be assessed precisely through the prism of their positions and actions at this key moment.
In your opinion, why exactly did the topic of the euro turn out to be such fertile ground for myths, disinformation, overexposure of risks and incitement of fears?
After 2020, in the conditions of political crisis, the fragmented pro-European majority ceded the initiative on the topic of the euro to an aggressive and noisy anti-European minority. The creation of a stable pro-European government with a constitutional majority in parliament, which supports joining the eurozone, has changed the dynamics in a positive direction in recent months.
Analysts and politicians often rely on the so-called “unpublished BNB analysis of the euro”. Could you explain what is the case with this document, which everyone seems to read as they please?
The document in question was sent to all parliamentary groups back in 2022. It is also publicly available on the BNB website, along with a number of other materials on the topic.
Are there still valid risks from changing the monetary regime from a board to the euro and what are they?
Yes, there are risks - if the process is not managed well. But this applies to any serious reform.
One of the meaningful criticisms is that the currency board has a disciplinary function for public finances and without it they could be taken over by populism. What is your answer?
The currency board is one of the most successful reforms in the economic history of Bulgaria. But it should not be attributed supernatural qualities. I say this as someone who participated in its introduction. The board, for example, did not prevent the loosening of fiscal discipline in recent years. We should not forget that it can be abolished with just one decision in the National Assembly. The Eurozone offers more reliable mechanisms for protection against crises and populism.
Another topic that arouses a lot of passion is what will happen to the foreign exchange reserves and how will their management change?
The BNB will continue to manage its foreign exchange reserves, as it has done so far. Of course, their composition will change, since the euro will become the national currency. It is little known that after joining the eurozone, the BNB will have the opportunity to manage - in a certain order and in certain volumes - also part of the reserves of the ECB itself.