The Bulgarian currency has been pegged to the Deutsche Mark for more than twenty years now. This means that we’ve pretty much been using the euro since its inception, and any opposition is just a populist manoeuvring
While it's true that a pegged currency is like using the euro with respect to current purchasing power, that definitely isn't all that matters and it isn't the most important consideration either.
Here is something more important - having your own currency and its associated banking infrastructure serves as an insurance against applying financial pressure to the country, such as stuffing non-repayable loans down the country's throat and then gorging on indefinite loan extensions with high interest rates and amounts - a strategy used so many times but mentioned so very rarely.
Case in point - Greece, that happened to them right after they went all in on the euro and killed their drachma.
It might be that Bulgaria has been tied up to the conveyor belt already and there is no way out of the slaughter house, I don't know the case enough to judge, but in principle, the EU would work much better as a customs union, politicizing it has proven to be a dirty affair.
Putin Putin aside for now, he's irrelevant anyway.
The loans weren't given for investments. Besides, if the Greeks had the drachma they wouldn't be given these loans in the first place.
But you started a very interesting topic - who is more at fault in the case of under-performing loans - the lender, the borrower, or is it 50-50?
Greek's borrowing binge was a drug shot in the arm, when they woke up, they found their shipbuilding industry gone... to the new EU members like Poland who sold cheaper and without tariffs within the EU. The Euro made Greek's recovery impossible.
Unintended consequences or something else? Another interesting topic that applies to many cases besides Greece.
It’s not, it’s a couple hundred people and it’s mostly old folks that are 60+, as they’re easy to be riled up due to them longing for russian occupation.
Also a referendum on the topic was ruled illegal, because it’ll violate the EU accession, where EU adoption is mandatory when criteria are met.
Also it’s too late now, it all depends on two votes on the 8th of July by the ministers of finance and the EU parliament. Bulgaria has no way of pulling out now, without doing massive damage to their EU integration, credit score and investors’ interest.
Adoption of the Euro currency is mandatory for European Union member states. Only a few states have negotiated an exception (Denmark, previously UK?) and others like Sweden apparently keep delaying somehow. Bulgaria doesn't have much leverage I don't think...
Problem is, that terms for adopt Euro as currency was differnet when becoming a memeber state back then.
Now we have strong push of digital euro with centralised regulations which is something that I would never agree with (privacy and economic concerns) and so I'm agianst adopting Euro in my country.
[Eventually] joining the Euro is part of the rules to join the EU. One could say they've already voted for this.
As a victim of Brexit, I'd love to undo that particular referendum, but I also understand the instability retrying big decisions would cause. Hungary joining the Euro has been on their cards since 2007.
Somehow it was possible to do referendum about entering EU membership, but there was none referendum about leaving EU except GB. There would be probably few states where majority would like to leave EU.
I don't know if it's their intention but as soon as the article mentions that the protest leader is pro-Russian, I immediately assume anything he stands for is wrong and therefore euro adoption must be good. Of course someone pro-Russian is trying to push countries away from integrating with the West, and I have to assume any arguments he's making are probably disingenuous and misleading.
There were even Russians at some of the anti Euro protests. Probably proped up by the Kremlin through Tiktok and Telegram.
Bulgaria has a pegged currency to the Euro since forever, they got quite depopulated after 1991 and their only chance is to become a tourist destination and to attract some investments from Türkye and maybe Greece, because nobody else would invest. The fact that Romania isn't interested in builing more bridges over the Danube and that Serbia isn't part of the EU also puts the northern part of Bulgaria in a tight spot. If you want to see what a depopulated country looks like, travel through northern Bulgaria. It looks like the descriptions from the book The World Without Us.
Croatia had kuna pegged to Euro, replaced it with euro in 2023 and prices of almost everything went up. Why Bulgaria's government is working against it's people?
It is clearly not in the benefit of Bulgaria to join a shared currency with advanced, manufacturing, positive export surplus countries like Germany.
Losing control of the currency will result in all domestic manufacturing to become more expensive (therefore incapable to compete with higher quality German goods), and all manufacturing capabilities will disappear in favour of the most cancerous form of industry, tourism. Like what happened to Greece and Portugal.
They are not losing any control because they never had any. The Bulgarian currency was tied to the DM and later to the Euro. The only thing that changes now is that instead of 2 Leva = 1 Euro, everything will just be Euro.
It’s also funny to see how anti everything related to EU/Europe most of the tech people are. You can see this here, like most of the comments that now proclaim the death of Bulgaria or Germany bailing them out, from people that have no clue on the background and history of this move.
Bulgaria has already pegged its currency (the lev) to the euro through a currency board since 1997. This means it already lacks independent monetary policy, and joining the euro wouldn’t significantly change that. The exchange rate is fixed, and inflation differentials are already impacting competitiveness.
Moreover, Bulgaria does not directly compete with Germany in the same product categories. Bulgaria is integrated into supply chains, often providing components or assembly work for German companies.
You are only 7M. I’ve got the feeling that it is just not large enough to significantly be distorted by eurozone monetary policy, at least in the way that might affect much larger economies.
I'm not so familiar with Greece's and Portugal's issues when switching to the euro, but I have followed along the news with Croatia's switch to the euro. Where it was a prime excuse for the large chains (mainly supermarket chains) to round up prices during the conversion.
> Bulgaria is unusual in that it pegged its currency, the lev, to the euro right from the beginning of monetary union in 1999, even before it joined the European Union in 2007.
Apparently, they did not use that control in the last 26 years.
Same perception here, none of what is said by GP should be downvoted. Almost 25 years after its implementation, it's high time the overall impact of the Euro was assessed objectively.
You simply do not know if he is objectively wrong. On the basis of 25 years of Euro, what we have observed is that in the eurozone, capital follows productivity, and countries tend to specialise in line with what their factor endowment and national inclination will let them.
The Euro is usually "sold" as a miracle solution when it has only really been successful for countries that had a very export oriented string industrial sector, and even then, with mixed results (see Italy).
Bulgaria can hope for capital inflows and increase in productivity but should also bear in mind that these factors are highly independent on economies of scale and overall sheer size of of the existing industrial base. Capital outflows and alignment with standard european prices may well be in order. This taking the average population age may be a killer.
We'll see.
I think you may be forgetting the big picture, which is to never have Europe spawning a World War again. In that regard, the fears (rational and irrational) of those with tendencies for isolationism are simply not relevant.
what are those odds looking like in the mid future? How many european governments are currently considered on the "extreme" spectrum?
And what makes you think the Euro implemented in 2002 is the reason for the non-reoccurence of a war ended in 1945?
Studying the root causes of the two world war would certainly enlighten
I happened to be in downtown Sofia last night by chance and saw the massive protest.
https://apnews.com/article/bulgaria-euro-protest-nationalist...
If opposition to the Euro is so massive, can't they simply hold a referendum over it?
The Bulgarian currency has been pegged to the Deutsche Mark for more than twenty years now. This means that we’ve pretty much been using the euro since its inception, and any opposition is just a populist manoeuvring
While it's true that a pegged currency is like using the euro with respect to current purchasing power, that definitely isn't all that matters and it isn't the most important consideration either.
Here is something more important - having your own currency and its associated banking infrastructure serves as an insurance against applying financial pressure to the country, such as stuffing non-repayable loans down the country's throat and then gorging on indefinite loan extensions with high interest rates and amounts - a strategy used so many times but mentioned so very rarely.
Case in point - Greece, that happened to them right after they went all in on the euro and killed their drachma.
It might be that Bulgaria has been tied up to the conveyor belt already and there is no way out of the slaughter house, I don't know the case enough to judge, but in principle, the EU would work much better as a customs union, politicizing it has proven to be a dirty affair.
Putin Putin aside for now, he's irrelevant anyway.
Did Greece spend the down-the-throat-loans down the drain or invested into infrastructure projects as intended?
The loans weren't given for investments. Besides, if the Greeks had the drachma they wouldn't be given these loans in the first place.
But you started a very interesting topic - who is more at fault in the case of under-performing loans - the lender, the borrower, or is it 50-50?
Greek's borrowing binge was a drug shot in the arm, when they woke up, they found their shipbuilding industry gone... to the new EU members like Poland who sold cheaper and without tariffs within the EU. The Euro made Greek's recovery impossible.
Unintended consequences or something else? Another interesting topic that applies to many cases besides Greece.
It’s not, it’s a couple hundred people and it’s mostly old folks that are 60+, as they’re easy to be riled up due to them longing for russian occupation.
Also a referendum on the topic was ruled illegal, because it’ll violate the EU accession, where EU adoption is mandatory when criteria are met.
Also it’s too late now, it all depends on two votes on the 8th of July by the ministers of finance and the EU parliament. Bulgaria has no way of pulling out now, without doing massive damage to their EU integration, credit score and investors’ interest.
It is legal to do referendum about entering EU, but illegal to do referendum about leaving EU? It sounds quite totalitarian.
Adoption of the Euro currency is mandatory for European Union member states. Only a few states have negotiated an exception (Denmark, previously UK?) and others like Sweden apparently keep delaying somehow. Bulgaria doesn't have much leverage I don't think...
Problem is, that terms for adopt Euro as currency was differnet when becoming a memeber state back then.
Now we have strong push of digital euro with centralised regulations which is something that I would never agree with (privacy and economic concerns) and so I'm agianst adopting Euro in my country.
[Eventually] joining the Euro is part of the rules to join the EU. One could say they've already voted for this.
As a victim of Brexit, I'd love to undo that particular referendum, but I also understand the instability retrying big decisions would cause. Hungary joining the Euro has been on their cards since 2007.
The Bulgarian parliament refused to organize a referendum despite the civil petition for such.
Somehow it was possible to do referendum about entering EU membership, but there was none referendum about leaving EU except GB. There would be probably few states where majority would like to leave EU.
I don't know if it's their intention but as soon as the article mentions that the protest leader is pro-Russian, I immediately assume anything he stands for is wrong and therefore euro adoption must be good. Of course someone pro-Russian is trying to push countries away from integrating with the West, and I have to assume any arguments he's making are probably disingenuous and misleading.
And you’re right in this case!
There were even Russians at some of the anti Euro protests. Probably proped up by the Kremlin through Tiktok and Telegram.
Bulgaria has a pegged currency to the Euro since forever, they got quite depopulated after 1991 and their only chance is to become a tourist destination and to attract some investments from Türkye and maybe Greece, because nobody else would invest. The fact that Romania isn't interested in builing more bridges over the Danube and that Serbia isn't part of the EU also puts the northern part of Bulgaria in a tight spot. If you want to see what a depopulated country looks like, travel through northern Bulgaria. It looks like the descriptions from the book The World Without Us.
Croatia had kuna pegged to Euro, replaced it with euro in 2023 and prices of almost everything went up. Why Bulgaria's government is working against it's people?
Prices also went up in Bulgaria without us adopting the euro…
Prices went up almost everywhere, but with euro adoption prices went up even higher.
Bulgaria with no euro had a higher inflation rate than Croatia with euro, soooo… no
With euro it would have even higher. So yes.
May I suggest you to show some data supporting your claims?
Why don't you bring back the kuna to reduce the inflation? Hold a referendum? Why no one believes this will bring down the inflation?
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Yes, but this is a step in the richer direction
Great, another chronically bankrupt country that Germany has to stand bail for.
another country to keep euro artificially low for german exports to thrive (though they don't so much lately)
It is clearly not in the benefit of Bulgaria to join a shared currency with advanced, manufacturing, positive export surplus countries like Germany.
Losing control of the currency will result in all domestic manufacturing to become more expensive (therefore incapable to compete with higher quality German goods), and all manufacturing capabilities will disappear in favour of the most cancerous form of industry, tourism. Like what happened to Greece and Portugal.
They are not losing any control because they never had any. The Bulgarian currency was tied to the DM and later to the Euro. The only thing that changes now is that instead of 2 Leva = 1 Euro, everything will just be Euro.
It’s also funny to see how anti everything related to EU/Europe most of the tech people are. You can see this here, like most of the comments that now proclaim the death of Bulgaria or Germany bailing them out, from people that have no clue on the background and history of this move.
Bulgaria has already pegged its currency (the lev) to the euro through a currency board since 1997. This means it already lacks independent monetary policy, and joining the euro wouldn’t significantly change that. The exchange rate is fixed, and inflation differentials are already impacting competitiveness.
Moreover, Bulgaria does not directly compete with Germany in the same product categories. Bulgaria is integrated into supply chains, often providing components or assembly work for German companies.
You are only 7M. I’ve got the feeling that it is just not large enough to significantly be distorted by eurozone monetary policy, at least in the way that might affect much larger economies.
I'm not so familiar with Greece's and Portugal's issues when switching to the euro, but I have followed along the news with Croatia's switch to the euro. Where it was a prime excuse for the large chains (mainly supermarket chains) to round up prices during the conversion.
Is there any trustworthy reporting on this?
All it takes is for one chain to round prices down (1-2¢ isn't going to be an issue for them), advertise this, and gain many new customers.
That is of course assuming that widespread corruption does not allow cartels.
The markets are only efficient on paper ;)
> Bulgaria is unusual in that it pegged its currency, the lev, to the euro right from the beginning of monetary union in 1999, even before it joined the European Union in 2007.
Apparently, they did not use that control in the last 26 years.
Exactly, thank you for pointing this out. The Euro has hardly been the boon promised in many of the countries that have adopted it.
It also happened to Spain.
I don't know why this comment got downvoted, what it says is true. Having experienced it as a greek first hand.
Because it is wrong. Lev is pegged since 1999.
And if you (or the first comment author) had read the article, then you would immediately have identified the problem with the comment.
Same perception here, none of what is said by GP should be downvoted. Almost 25 years after its implementation, it's high time the overall impact of the Euro was assessed objectively.
But GP didn’t say that, he said it’ll be bad for Bulgaria and he’s objectively wrong, due to all the reasons outlined by others.
You simply do not know if he is objectively wrong. On the basis of 25 years of Euro, what we have observed is that in the eurozone, capital follows productivity, and countries tend to specialise in line with what their factor endowment and national inclination will let them. The Euro is usually "sold" as a miracle solution when it has only really been successful for countries that had a very export oriented string industrial sector, and even then, with mixed results (see Italy). Bulgaria can hope for capital inflows and increase in productivity but should also bear in mind that these factors are highly independent on economies of scale and overall sheer size of of the existing industrial base. Capital outflows and alignment with standard european prices may well be in order. This taking the average population age may be a killer. We'll see.
Again, he’s arguing that Euro will be bad for Bulgaria, not that the Euro is bad.
This is objectively wrong, since Bulgaria currently had 0 control over its currency, where joining the eurozone, they’ll have a vote at the table
I think you may be forgetting the big picture, which is to never have Europe spawning a World War again. In that regard, the fears (rational and irrational) of those with tendencies for isolationism are simply not relevant.
what are those odds looking like in the mid future? How many european governments are currently considered on the "extreme" spectrum? And what makes you think the Euro implemented in 2002 is the reason for the non-reoccurence of a war ended in 1945?
Studying the root causes of the two world war would certainly enlighten
It is just something we, the children of those who fought, promised to our grand parents on their deathbed. Such things matters.