Inflation, Current Account Deficit, Corruption Said to Hamper Bulgaria en Route to EuroFinance | September 17, 2009, Thursday // 10:23| views
The Czech daily newspaper LidovГ© noviny cites diplomats, according to whom rampant corruption and organized crime were also among the reasons for keeping the EU's poorest nation away from the euro. Photo by EPA/BGNES
Bulgaria has set 2013, when the term of the new center-right government expires, as the target date for adopting the euro, the Czech daily newspaper Lidové noviny reported, citing the country's Finance Minister Simeon Djankov.
Bulgaria's new center-right government plans to apply in November to join the ERM 2 exchange-rate mechanism, the European Union's two-year currency stability test before the country can drop the lev and adopt the euro, the article points out.
"The Bulgarians did not make it earlier to the ERM 2 due to high inflation and current account deficit, which has exceeded 20% of GDP over the last few years," Lidové noviny said.
The newspaper also cites diplomats, according to whom rampant corruption and organized crime, which the previous Socialist-led government failed to tackle, were also among the reasons for keeping the EU's poorest nation away from the euro.
Joining the exchange-rate mechanism would bring Bulgaria closer to the umbrella of the euro region and the protection of the European Central Bank and is conditional on whether the new government will succeed to restore Brussels trust.
The lev is already linked to the euro in a currency board that keeps the Bulgarian currency at 1.9558 to the euro. Joining the exchange-rate mechanism may allow the lev to fluctuate by as much as 15 % around a central band, though the central bank has said it will leave the lev tightly pegged to the euro through the duration of the two years.
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