Dnevnik online newspaper carries an analysis by the Institute for Market Economics, according to which the exchange rate mechanism is, above all a political act, and is, therefore, thoroughly unpredictable at this time.

Over public fears of a change in the current Lev-Euro exchange rate, the idea has crept into debates on the matter of postponing Bulgaria’s entry into the exchange rate mechanism ERM II by several months until a “consensus” on the matter is achieved. It has been clear at an expert level for more than 20 years that spending time under ERM II is unnecessary for Bulgaria, as the country’s currency board excludes any fluctuations in the Lev-Euro exchange rate.

But this does not mean a stay in ERM II can be avoided. There is one more reason why fears are unfounded – Estonia and Lithuania kept their currency boards unilaterally within ERM II, and later entered the Eurozone without any change to their exchange rates. The fact that over the past 3-4 weeks the debate turned to controversy goes to show that there can never be complete consensus regarding he currency board or the euro. But if Bulgaria were to not only postpone entry to ERM II but abandon plans of introducing the euro altogether, all kinds of “plan B” would sprout as an alternative to the currency board. However, a discussion of this kind could be pose a very grave danger to the Lev, Institute for Market Economics experts say.

Meanwhile the international credit rating agency Fitch Ratings affirmed Bulgaria's sovereign long-term foreign and local currency Issuer Default Ratings at “BBB” with a positive outlook, the Ministry of Finance announced, adding that Bulgaria’s formal entry into ERM II is pointed to as the sole most important factor that could lead to a rise in the country’s sovereign credit rating. And that a halting of the process of accession to the euro would lower the country’s credit rating.

Bulgaria’s entry into the Eurozone is a good thing and I have lots of arguments to support this, says Assoc. Prof. Grigorii Vazov, rector of the University of Finance, Insurance, Business and Entrepreneurship, and member of the Fiscal Council of Bulgaria. Commenting on fears of a speculative rise in prices, he explained, in an interview for the BNR’s Horizont channel that “the market will quickly regulate the processes”. In his words the advantages for entrepreneurs after entry into ERM II and the Eurozone will be the low-interest loans.

According to Iliyana Tsanova, Deputy Managing Director of the European Fund for Strategic Investments, entry into the Eurozone is the best decision possible – political and economic. Entering ERM II would be the biggest legacy of Boyko Borissov’s administration, she says in an interview for the Bulgarian National Radio.

It is important that the debate on entry into the Eurozone be based on facts, says Iliyana Tsanova with regard to public fears of a decline in purchasing power, a rise in inflation rates and a devaluation of savings in the process of the Lev to Euro transition. In her words the fixed rate of the euro to the Bulgarian Lev already provides an entrance to the eurozone:

Being an informal member of the Eurozone we have no way of influencing the decisions made there but once we enter the “waiting room”, ERM II, that is going to change.

The country is in a favourbale position – we have sound financial discipline, a very low debt and deficit level, a very low unemployment rate and the Bulgarian Lev is very stable as a currency, Tsanova explains. It can even be said that the Lev is undervalued, she adds. The introduction of the euro in Bulgaria has other advantages as well – such as interest on loans which are 40 percent lower in Eurozone countries, she says.

If we take a look at the facts we shall see that inflation in the countries of the Eurozone is lower than before their accession to it, says Iliyana Tsanova and adds that Bulgarian banks will be supervised by the European Central Bank according to European rules.

People’s money will be better protected - in the banking and in the insurance sector, as well as in pensioning, Iliyana Tsanovasays.