BRUSSELS, May 15 (Reuters) - Bulgaria will need at least three more years to join the euro zone, the vice president of the European Commission said on Tuesday.
The Bulgarian government plans to join the ERM-2 mechanism, a preliminary stage for the adoption of the euro currency, in the first half of this year. Rules stipulate that after two years in the ERM-2 a country can join the euro.
But for the Balkan country, which has been a member of the 28-country European Union since 2007, it could take a bit longer.
“The timeline is clear. It takes broadly speaking at least three years between joining the ERM-2 and joining the euro” provided all fiscal criteria are met, Valdis Dombrovskis told a conference organised by Politico in Brussels.
Bulgaria already meets the formal criteria for adopting the euro: It has a budget surplus, very low debt and long-term interest rates and moderate inflation.
But it is the EU’s poorest member and with a gross domestic product per capita, calculated as power purchasing parity, at 49 percent of the EU average. Many blame this on corruption.
Dombrovskis made it clear that “joining the euro area now means also joining the banking union”, the bloc’s flagship project to strengthen EU monitoring of large national banks.
Dombrovskis’ remarks are in line with the requests made by the European Central Bank to Bulgaria. The ECB, which assesses whether a country qualifies for membership of the 19-country euro zone bloc, wants Bulgaria to join the banking union before adopting the euro. This would give the ECB direct powers to oversee big Bulgarian banks.
Bulgarian Finance Minister Vladislav Goranov said the two processes were parallel. “One cannot be a precondition for the other,” he said last month at a meeting of EU finance ministers in Sofia, the Bulgarian capital. (Reporting by Francesco Guarascio Editing by Raissa Kasolowsky)