Bulgaria’s planned adoption of the euro in January 2026 is a major step in its European integration but will not automatically lead to higher living standards, International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on November 4.

Bulgaria received final approval to join the euro area from the Council of the European Union and the European Parliament on July 8, 2025, and will become the 21st member of the bloc as of January 1, 2026.

Speaking at a high-level conference in Sofia, Georgieva praised the country’s readiness for euro area membership but urged policymakers to stay focused on reforms to boost productivity, competitiveness and income growth.

“Adopting the euro is an important step, but it does not in itself guarantee a higher standard of living,” she said, according to an IMF transcript. “The task now is to pair euro adoption with good policies and catapult convergence to the next level.”

Georgieva said Bulgaria’s economy had made significant progress since joining the European Union in 2007, but warned that growth and income convergence with Western Europe had lagged behind that of peers such as the Baltic states and Romania. She called for disciplined fiscal policy, vigilance against financial risks and accelerated structural and governance reforms to sustain long-term growth.

She outlined three key domestic priorities: tightening fiscal policy to curb inflationary pressures, strengthening macro-prudential measures to prevent overheating in credit and housing markets and pursuing reforms to improve productivity and attract investment.

“Fiscal discipline has served Bulgaria well over the decades,” Georgieva said, noting that the country’s public debt is among the lowest in the EU. “But now the focus should be on tempering wage growth, investing in productivity, and maintaining financial stability.”

European Central Bank (ECB) President Christine Lagarde, also speaking at the event, congratulated Bulgaria on reaching the final stage of eurozone entry but said the transition marked “the beginning of a journey, not a destination,” BTA reported.

“Bulgaria has come a long way and done a lot of hard work,” she said. “It is a huge step you are reaching, but it is the beginning of a journey of continued reforms.”