Bulgaria's capital Sofia hosted on December 8 the Bulgaria Economic Forum 2016. The main topic of discussion was related to the country's accession bid to the Eurozone. The participants at the forum commented why the European leaders did not allow Bulgaria to enter the ERM-2 mechanism. According to Bulgaria's economic expert Georgi Ganev, the Eurozone must solve its internal problems, before accepting new members. Formally, Bulgaria meets all economic criteria. However, it has to stay at the Eurozone's waiting room (the Exchange Rate Mechanism, known as ERM-2) for at least two years. In Georgi Ganev's view, the prices in Bulgaria will not increase drastically after the adoption of the Euro currency. The participants at the Bulgaria Economic Forum commented that Bulgaria has not been treated equally with other applicant countries. More from Georgi Ganev:

“There are some standard benefits stemming from Bulgaria's possible accession to the Eurozone. The local business and households will receive cheaper financial resource, the trade volumes with other members of the Eurozone (which is one of the most-developed markets worldwide) will increase as well. The companies will spend less money upon making deals with business partners from the single currency union. Moreover, they will not have to change the local currency into Euros.One of the standard minuses related to Eurozone membership-the loss of independent monetary policy, does not concern Bulgaria. Even now we are connected with the Eurozone and the country feels some of the consequences of possible turbulence in the Eurozone and worldwide. Another minus stemming from possible Eurozone membership regards the country's obligation to finance other Eurozone members, if some of them enter financial crisis. Moreover, the indebtedness of the cabinet, the companies and the households may rise significantly, because Bulgaria will have access to cheap financial resource as it already happened in Greece, Portugal and Spain. It is not necessarily bad for the companies and households to receive more credits, if they manage their debts adequately. We noticed, however, that the country's Ministry of Finance and the Bulgarian National Bank are unwilling to discuss the topic related to Bulgaria's accession to the Eurozone in public.”

According to the Chairman of Bulgaria Economic Forum Georgi Tabakov, the possible accession to the Eurozone would bring more benefits than minuses and that now is the perfect moment for Bulgaria to make a resolute step towards that goal. Mr Tabakov pointed out that the citizens of the Eurozone member countries pay three or four times less for their loans than the Bulgarian citizens in times when Bulgaria is still in a Currency Board. Georgi Tabakov contends that the main risks to Europe's economy and to the Eurozone are related to instability and populism.

The participants at the discussion commented the influence of the Eurozone accession process over various sectors-public finance, financial sector, Bulgarian households' budget, labor market, direct investments, tourism, power engineering, imports and exports. They discussed the experience of three Eurozone countries-Lithuania, Latvia and Slovakia. All three experts-Andris Vilks (former Minister of Finance of Latvia), Gediminas Simkus (Executive Director of the Economic and Financial Stability Service, Central Bank of the Republic of Lithuania) and Igor Barat (head of the European Regional Office, International Investment Bank, Slovakia) were unanimous that Bulgaria cannot overcome the challenges related to possible Eurozone accession, if the society does not reach a consensus on whether it wants to adopt the Euro as its national currency. In their view, the adoption of Euro must be preceded by political stability. Moreover, the country must hold a good information campaign first and the local business and banking sector must prepare well for the forthcoming membership.The representatives of Latvia, Lithuania and Estonia encouraged Bulgaria's efforts to join the Eurozone.

The second part of the Bulgaria Economic Forum accentuated on the business environment for the country's small and medium-sized enterprises. The participants discussed possibilities related to economic development, financing, exports, imports, etc.

English version: Kostadin Atanasov