Bulgaria shelves plans to join the common currency

The Wall Street Journal reports that “in response to deteriorating economic conditions and rising uncertainty over the prospects” of the Eurozone, Bulgaria “has indefinitely frozen long-held plans to adopt the common currency.” Interviewed by the WSJ, Prime Minister Boyko Borisov and Finance Minister Simeon Djankov, said that the risks posed by euro-membership for the country, which is entering the third year of an austerity programme, are too great.

"The momentum has shifted in our thinking and among the public.…Right now, I don't see any benefits of entering the Eurozone, only costs," pointed out Mr. Djankov, who added, “it's also not certain what the rules are and what are they likely to be in one year or two." Arguing that disagreement over the scope of austerity will continue to be a problem for the single currency, Prime Minister Borisov predicted that "we will definitely see a deepening divide in Europe now because many governments are not prepared to stomach the difficult decisions they have to take. It's like a spoilt child who doesn't want to go to the dentist to fix his bad teeth, even though the operation is needed."

EUObserver points out that “Bulgaria already fulfills the economic criteria to join the euro, having reduced its budget deficit to 2.1 percent in 2011, comfortably below the 3 percent limit laid out in the Stability and Growth Pact.” The news website also notes that the country’s change of heart does not comply with existing agreements: “All EU member states with the exception of Britain and Denmark are required to join the single currency under the terms of their EU membership.”