Bulgaria’s euro adoption coordination centre: 36% of leva out of circulation

More than 36 per cent of leva are out of circulation, the head of Bulgaria’s coordination centre for euro adoption said on January 6, describing the country’s process of adopting the European currency as going smoothly.

The coordination centre, established by a Cabinet decision on December 30, held its first news conference six days after Bulgaria adopted the euro as its currency.

Coordination centre head Vladimir Ivanov told the briefing: “Currently, the consumer basket is 101.70 leva or 52 euro. It is literally the same as it was on December 30 – almost unchanged. As for basic food products, we have a good situation on the food market.”

He said that Bulgarian National Bank (BNB) has been notified of reports of banks refusing to exchange currency to people who are not their clients, and of limits placed by the banks themselves on the amount that can be exchanged.

The central bank has taken up the cases, Ivanov said.

He said that on the first working day of January, about eight million leva were exchanged in Bulgarian Post branches.

In some places, a shortage of 10 and 20 euro banknotes was identified.

“The process is going quite well. Conditions have been provided in the country for people to be supplied with euro,” he said.

Ivanov advised people not to look for alternative “street” ways to exchange currency, so as not to damage their interests and not become the target of crimes.

The authorities expect the bulk of the leva in circulation to be withdrawn by the end of March , with most of this happening in January, the month of the dual circulation period.

Hristo Markov, who was appointed director of the National Revenue Agency at the end of November, said that the currency changeover process was moving well and there were no mass violations.

Ivanov said that about 4000 inspections had been carried out by the Consumer Protection Commission and the National Revenue Agency from January 1 to 5, with violations found at about seven per cent. Minimum fines had been imposed because these were first offences.

He said that sanctions are not an end in themselves, but are a tool for protecting conscientious traders.

The authorities plan to conduct about 300 inspections per day between January 5 and 9, related to groceries, hairdressing services, parking lots, language courses, translation services, among others.

From January 8, inspections will be stepped up in winter resorts.

Ivanov reported a technical problem with a specific type of taxi meter. According to him, about 80 per cent of the technical errors with this specific model have already been resolved.

On January 5, Albena Georgieva, executive director of one of the largest retail chains in Bulgaria, told Nova Televizia that the start of payments with the euro currency has been successful.

“Everything is going smoothly, customers understand the need for patience when processing the two currencies used in parallel,” Georgieva said.

There are emotional situations at the cash desks, for example, citizens split bills, they think that retail chains are like banking institutions – they pay smaller bills with cents in order to get euro back. But with a conversation, these things are clarified and it gets better day by day ,” she said.

About 30-35 per cent of the chain’s customers were paying in euro, Georgieva said.

“It’s mainly payments with bank cards. In general, Bulgarians continue to shop with the current currency (leva) and I think this will continue until the end of January,” she said.

“On January 2, we had a shortage of coins at the expense of euro banknotes, but this was corrected the next day.

“The reason was that many bank branches were closed and people might have used the shops to exchange currency. We are more careful with 200 and 500 euro banknotes ,” she said.

Georgieva described concerns about rising food prices as unfounded.

In the hotel, restaurant and catering sector, price speculation is also not expected, Atanas Dimitrov of the Bulgarian Hotel and Restaurant Organisation, told Nova TV.

Dimitrov appealed for patience from customers due to the more complicated work with two currencies.

Milena Dragiyska, executive director of one of the largest food chains in Bulgaria, gave an assurance on January 5 that shops were well prepared with euro banknotes and coins and there were no disruptions.

“The market mechanism has proven to work, and no chain has an interest in losing trust by speculatively raising prices,” she added.

The deputy chairperson of the Bulgarian Industrial Association, Stanislav Popdonchev, said on January 5 that the widespread fears surrounding the introduction of the euro had not been justified and the process was proceeding much more calmly than expected.

(Archive photo: Europol)