Bulgaria’s accession to the euro area on January 1, 2026 marks the culmination of a long convergence journey and the beginning of a new phase of economic integration and opportunity, reads the report Beyond Real Estate: Bulgaria Joins the Eurozone by macroeconomist Grzegorz Sielewicz, Head of Economic Market Insights at Colliers. The country enters the eurozone as a steadily growing economy that has narrowed the income gap with the EU, strengthened its macroeconomic fundamentals and improved its sovereign risk profile, the document reads.
He begins his analysis on Bulgaria with a look back at its path to the euro, recalling the role of the currency board for its public finances’ stabilization in the 1990s, the entry in ERM II and the Banking Union in 2020. Over the reference period from May 2023 to May 2025, the Bulgarian lev showed no deviation from the central rate, inflation averaged 2.7% compared to a 2.8% reference, the 2024 deficit was 3.0% of GDP, and debt stood at 24.1% of GDP, far below the 60% threshold and among the lowest in the EU. As a result, the country met all the required Maastricht criteria on price stability, public finances, exchange-rate stability and long-term interest rates for entry in the eurozone. In mid-2025, convergence reports by the European Commission and European Central Bank (ECB) confirmed that, the macroeconomist notes.
Even if it remains the poorest EU Member State on headline metrics, Bulgaria has made tangible progress in real convergence over nearly two decades of EU membership, the report reads. GDP per capita in purchasing power standards has risen to around two thirds of the EU average, compared with below 40% in the mid-2000s, marking eleven consecutive years of gradual catch up. In absolute terms, GDP per capita in PPP terms now exceeds USD 34,000, illustrating how the economy has transitioned from a low-income periphery towards an emerging middle income EU Member State with deep integration into European value chains. Colliers estimates that real GDP rose by 3.1% in 2025 (after 3.4% in 2024), while it is expected to reach 3.0% in 2026. The economy is driven by robust domestic demand thanks to higher household consumption benefiting from rising wages and pensions while private investment is supported by confidence around euro entry and EU fund absorption. Unemployment was at record lows in 2025.
“The euro decision has crystallised in sovereign rating upgrades that reflect Bulgaria’s improved creditworthiness and institutional anchoring,” the author notes, recalling that last year, S&P Global Ratings and Fitch both raised Bulgaria’s long-term rating to BBB+ with a stable outlook, and Scope Ratings moved Bulgaria into the A range. Sielewicz lists the expected benefits and opportunities for Bulgaria, namely: lower transaction costs and trade friction; enhanced investment flows; reduced borrowing costs for both corporate and sovereign borrowers; trade and tourism boost; financial stability and integration.
According to Colliers, the finalisation of Bulgaria’s full integration in the eurozone comes at a time when Bulgaria’s role in regional value chains and services exports is gradually expanding. Lower sovereign and banking sector risk, euro denominated financing and improved liquidity conditions should compress yields over time, help narrow the risk premium versus Central and Eastern European peers already in the eurozone, and broaden the investor base for office, logistics and retail assets.
The report’s author also looks at the public attitudes and support for the euro in Bulgaria, as well as the regular cabinet’s resignation after anti-government protests in the autumn of 2025. “In terms of euro adoption process, the political context has not impacted the euro accession calendar,” the macroeconomist notes.
Despite official optimism, surveys show mixed public sentiment. The June 2025 Eurobarometer poll found 53% of Bulgarians opposed to the euro and 45% in favour, the report recalls. “Similar to other countries which adopted the euro, Bulgarians’ concerns focus on price effects with fears of prices rounded up after euro conversion,” the document reads.
“Joining the eurozone is more than a technical currency change. It represents Bulgaria’s full integration into the core of EU economic and monetary governance. The move should reinforce policy discipline, anchor inflation expectations and make the economy more attractive for long term foreign direct investment, while also increasing the responsibility to address remaining structural challenges, including demographics, productivity and governance,” Sielewicz notes. He concludes that euro adoption can become a catalyst that accelerates real convergence and helps Bulgaria close more of the remaining gap in living standards versus the EU average over the coming decade, as long as the single currency’s adoption is accompanied by continued reforms and effective use of EU funds.