Economist and former MP Georgi Ganev has sharply criticized the recent amendments to Bulgaria’s Euro Law, warning that the changes are likely to trigger a widespread price shock rather than curb inflation. In an interview with the Bulgarian National Radio, Ganev said the amendments will push prices higher than they would have risen under normal market conditions, blaming the state’s misguided intervention for the anticipated surge.
According to Ganev, the price increase will not be gradual inflation, but a sharp, one-off jump affecting all goods and services. He argued that traders are likely to raise prices quickly and significantly ahead of the law’s implementation in October, fearing potential penalties for future price hikes once the new rules are in force. This anticipatory behavior, he said, will lead to steeper increases in the coming months than would have occurred without the legislative changes.
“The new law creates a situation in which everyone in the market will try to cover themselves,” Ganev explained. “Instead of letting prices evolve naturally, businesses will act out of fear – raising prices now to avoid being punished later. And because the law is set to remain in effect for a year, we can expect another price spike a year from now.”
He emphasized that the very design of the law defies economic logic. Prices, he insisted, reflect the point at which a product or service can be sold – not something that can be dictated or capped by legislation. “There’s no market rationale behind these changes. If prices rise, it will be because of this law – nothing else,” Ganev said bluntly.
Ganev also took aim at the government’s plans to launch “People Shops,” a state-run retail network meant to provide affordable goods. He was skeptical of the initiative, highlighting the limited capital behind the project. “Ten million leva isn’t enough to open even a small store,” he said, adding that the funding will most likely be spent on salaries for staff appointed to oversee the project until the whole effort is eventually abandoned. “It looks like this whole ‘People Shops’ idea is just a front – another place to give jobs to some people for a few years,” Ganev concluded.