Bulletin: Bulgaria?s Eurozone Entry's Still Likely Despite Government Collapse

FRANKFURT (S&P Global Ratings) April 3, 2024--The power-sharing arrangement between the parties that have formed Bulgaria's government since June 2023 has fallen apart, triggering snap elections later this year. S&P Global Ratings believes Bulgaria (BBB/Positive/A-2) is still likely to join the eurozone, although meeting the official target of January 2025 may be more challenging. We believe the formation of a new government after the upcoming elections might be complex and lengthy, possibly echoing the political deadlock during 2021-2023. The lack of a regular government over the next few months could become a stumbling block. Nevertheless, we think the majority of Bulgaria's political parties are aligned on key policy priorities, including conservative fiscal management, reforms needed for disbursement of EU funds,

...FRANKFURT (S&P Global Ratings) April 3, 2024--The power-sharing arrangement between the parties that have formed Bulgaria's government since June 2023 has fallen apart, triggering snap elections later this year. S&P Global Ratings believes Bulgaria (###/Positive/A-2) is still likely to join the eurozone, although meeting the official target of January 2025 may be more challenging. We believe the formation of a new government after the upcoming elections might be complex and lengthy, possibly echoing the political deadlock during 2021-2023. The lack of a regular government over the next few months could become a stumbling block. Nevertheless, we think the majority of Bulgaria's political parties are aligned on key policy priorities, including conservative fiscal management, reforms needed for disbursement of EU funds, and eurozone accession. This means the next government will likely resume euro adoption efforts, in our view. We also believe European institutions, primarily the Eurogroup,...

Bulletin