New Bulgarian Government Abandons January 1, 2026 Eurozone Entry Bid

The Bulgarian government has effectively abandoned its plan to enter the eurozone on January 1, 2026, after Finance Minister Temenuzhka Petkova announced she will not request an extraordinary convergence report from the European Commission and European Central Bank. The country falls short of the inflation criterion by just 0.1 percentage points, with the current average annual inflation at 2.6% against the required 2.5%.

Despite previous optimism and statements about seizing the opportunity to join the eurozone, the government's coalition partners - Bulgarian Socialist Party and "There is Such a People" - have long been reluctant about rapid euro adoption. GERB leader Boyko Borissov, while previously emphasizing the country's eurozone window, appears to have compromised with coalition partners.

Petkova revealed significant financial challenges, announcing a deficit of over 3.6 billion leva for the first quarter of 2025. She plans to withdraw current budget-related laws and resubmit new drafts by February 14, hoping to limit the deficit to 3% of GDP. The government will temporarily use reserve funds to cover January expenses and ensure state functionality.

The minister expressed concern about the country's financial state, attributing current challenges to "unreasonable policy" over the past three years. She warned that Bulgarian citizens would need to "pay the bill" and assured that social payment funds remain secured. The cabinet is fully mobilized to implement measures addressing the financial situation.