The European Central Bank and the Commission announced on Wednesday that Bulgaria and Romania do not meet the necessary criteria to join the Eurozone. Inflation in both Black Sea coastal states has remained too high in comparison to the rest of the euro area, and they have not made sufficient progress in preventing corruption and money laundering, as required by the ECB and the Commission.
The ECB’s latest report, which is published every two years, examined the conditions of six EU countries that are not part of the common currency but are seeking to join the euro area. These countries include Bulgaria, Romania, the Czech Republic, Hungary, Poland, and Sweden. Bulgaria and Romania have been actively pursuing euro membership, but have faced challenges such as high inflation rates and violations of EU debt rules.
Bulgaria has been the closest to euro membership, with a goal to join the euro zone as early as next year. However, the country’s annual inflation rate of 5.1 percent in May exceeded the 3.3 percent reference value required by the ECB. Romania has had even higher inflation rates, averaging 7.6 percent last year, and also violated EU debt rules.
The ECB noted that countries in Eastern and Central Europe, including Bulgaria and Romania, have been affected by Russia’s aggression against Ukraine, resulting in decreased economic activity and increased energy prices. Out of the 27 EU member states, 20 belong to the euro area. Denmark, which has opted out of the euro, was not included in the ECB’s report.
Other EU countries outside the euro area, such as Croatia, have joined the common currency in recent years. The report did not examine Denmark’s conditions for adopting the euro. Additionally, the ECB highlighted the impact of Russia’s aggression on Eastern and Central European countries, leading to economic challenges and higher energy prices.
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