December 6 (SeeNews) - Bulgaria signed a memorandum of understanding (MoU) with the European Commission and the Eurogroup president, which paves the way for the country to start minting its own euro coins once it receives approval for euro zone membership, Bulgaria's central bank said on Tuesday.
The MoU regulates the practical steps for Bulgaria to take in order to strike certain quantities of test coins with the common face designs of the euro coins and the selected Bulgarian national designs, the central bank said in a statement.
Bulgaria is targeting January 1, 2024 as the date of accession to the eurozone.
In October, the Bulgarian parliament passed a resolution mandating the caretaker government and the Bulgarian National Bank to speed up negotiations with European institutions and technical preparations for the introduction of the euro.
The final decision on Bulgaria's accession to the euro zone must be made by the European Council.
Bulgaria fulfils certain criteria for becoming part of the euro zone, namely the requirements relating to public finances, exchange rate and long-term interest rates convergence, the European Commission and the European Central Bank said in the latest convergence report issued in June.
However, the report found that Bulgaria is not yet fully ready for euro adoption, as the levels of consumer price inflation and general government budget deficit exceed reference values. The country also needs to adopt legislative changes, including relevant to the central bank.
Bulgaria has had a currency board pegging the lev to the euro since July 1, 1997. The country joined the exchange rate mechanism (ERM II), the training ground for euro adoption, and the EU's banking union, in July 2020.
At a time of high economic uncertainty, a political impasse resulting from the October 2 elections is expected by analysts to pose a risk to the absorption of new EU funds necessary to promote economic growth and investments, further jeopardising the prospects of Bulgaria's euro adoption, S&P Global Ratings said last week.