Bulgaria Set To Join The European Exchange Rate Mechanism Phase 2 By April 2020

Bulgaria’s finance minister Vladislav Goranov has said the country will possibly conclude all processes needed for its accession to the Exchange Rate Mechanism II and the Banking Union of the EU by the end of April 2020, local media reported. 

After the European Insurance and Occupational Pensions Authority (EIOPA) expressed its support of Bulgaria’s prospective entry in ERM II – the mandatory preparatory stage for the adoption of the euro – and the Banking Union, the country is now awaiting approval from the European Central Bank (ECB),  news outlet Dnevnik.bg quoted Goranov as saying on Wednesday.

In August 2018, Bulgaria’s government adopted an action plan detailing measures in relation to the country’s bid to join the ERM II by July 2019. The measures in the plan are aimed at strengthening the regulatory framework on banking supervision, improving the macroprudential framework on credit borrowers, strengthening supervision of the non-banking financial sector (pension funds and insurers) and improving the insolvency framework, the government said at the time.

The European Bank for Reconstruction and Development (EBRD) said last year that the government should focus in 2019 on further reforms aiming to prepare Bulgaria for joining ERM II and the Banking Union, as well as addressing issues raised by the EU’s Cooperation and Verification Mechanism (CVM).

“In particular, the government needs to implement the new anti-corruption law, further improve the independence and efficiency of the judiciary, and step up the fight against organised crime by improving the legislative framework and increasing transparency,” the EBRD said at the time.

Earlier this month, the European Commission said that it mulls concluding the monitoring of Bulgaria under the CVM due to the country’s ‘sufficient progress’ in meeting its commitments regarding the mechanism.