6809 | 8 June 2025 | 17:55
Germany benefits from the Euro because it is a strong and attractive currency. We have benefited from the Euro and I believe that Bulgaria will also benefit. This was stated by former German Finance Minister in Olaf Scholz's government Christian Lindner in an interview with "120 Minutes" host Svetoslav Ivanov during the "Money Talks" business forum held during the week.
Lindner explained that on one hand, he understands the concerns and "romantic feelings" of Bulgarians who want to keep the lev, comparing it to the Deutsche Mark.
Germans were also proud of the Mark, and you have a currency named after the lion. So I understand the concerns and romantic feelings, but the long-term effects for the Bulgarian economy are much more important. In addition, it will be much easier for Bulgarian companies to enter the European market, explained the former finance minister of the most powerful European economy.
Regarding fears of price increases, Lindner pointed out that his compatriots have simply chosen to buy cheaper products on the market.
According to him, even if the government in Sofia falls, Bulgaria's path to the euro is already fixed.
See the full interview:
He is one of the most popular politicians in Germany. Until a few months ago, he was the finance minister of the largest and strongest economy not only in the eurozone, but in the whole European Union. Christian Lindner played a key role in the restart of the fiscal rules in the EU. He has managed to consolidate Germany's budget after COVID-19, and as chairman of the G7 finance ministers in 2022, he coordinated actions in response to Russian aggression in Ukraine. Christian Lindner arrived in Sofia for a few hours during the week to participate in the "Noise of Money" forum. Svetoslav Ivanov speaks with him directly on stage in front of the audience in the hall.
- Our topic today is "The Changing World: What's Next for Europe." We will talk about current global processes - the administration in the US, customs policy, the drama with Europe, the feeling of global instability. Against this background, is the eurozone a good prospect for Bulgaria?
Christian Lindner: Yes, of course it is. I have worked with the Bulgarian government - more precisely with governments - over the past few years and I have witnessed Bulgaria's efforts to meet the convergence criteria, inflation, growth, fiscal stability, debt to GDP and so on. That is why I want to congratulate the Bulgarian people for this great success. It was hard work, you achieved it and today is the moment to be proud of what has been accomplished in recent years.
- What is your personal opinion about the euro as a citizen - how do you see it?
Christian Lindner: Germany benefits from the euro. Before, we had concerns about the instability of currencies - the German mark was very strong. Some people were afraid that the euro would become something like the Italian lira, but the opposite happened. The euro is stable, a strong and attractive currency. "Currently, we are seeing how capital flows in the world are changing direction - more and more are directed towards the Eurozone. We have benefited from the euro and I believe Bulgaria will also benefit.
- What would you say to many Bulgarians who are afraid of adopting the euro? This is a normal process. As a German, you have also gone through such debates, right?
Christian Lindner: It's interesting because the situation is quite similar. Germans were proud of the Deutsche Mark. The mark was a symbol of the rise of the German economy after World War II - the so-called economic miracle. Isn't it the same in Bulgaria? You have a currency named after the lion - a national symbol of pride and identity. So I understand the concerns and even the romantic feelings associated with one's own traditional currency." But the positive effects for the Bulgarian economy, in my opinion, are much more important. Deals will become cheaper. This will lead to increased economic dynamics. It will also be easier for Bulgarian small and medium-sized enterprises to enter the single European market. Therefore, adopting the euro is in the long-term interest of Bulgarian citizens. Of course, I know that there are also short-term problems and concerns. Of course, there will be businesses that will take advantage of the introduction of the euro to raise prices. And we saw a similar situation in Germany. And what happened then? Customers have a choice - and they made it. They chose cheaper products. So in the long run, we did not see an increase in price levels. And I believe it is a very good step by the Bulgarian government to require double labeling of prices for a certain period - this way customers will be able to make informed decisions.
- One of the most common public concerns, in short, is related to a wave of price increases caused by speculation. How realistic is it for this to happen only in the short term? And can we rely solely on market self-regulation?
Christian Lindner: This is not just self-regulation, as far as I am aware. Double labeling of prices will be mandatory throughout the next year. So it's not about self-regulation. This is a clearly established market order. There may be short-term difficulties, but these short-term difficulties will be fully compensated by the long-term benefits. And we must make our decisions with a view to the future of our children. For the next generation, it is crucially important for Bulgaria to strive towards the heart of the European Union. You understand me.
- I don't like speculations.
Christian Lindner: Me neither
- But when you say it - you invite me to speculate... Let's speculate just a little bit! If the government falls in the middle of the transitional period - towards January 1, 2026. Imagine, the government in Sofia falls apart - what will happen then?
Christian Lindner: From everything I know, after the decision of the parliament in July and the subsequent decision of the European Council, the path towards the euro is already fixed. So, even though I am just an observer of the Bulgarian political landscape... From what I know - the decision has been made by Parliament, after which the European Council will also approve it, and the euro will be adopted in Bulgaria.
- Everyone is expecting Germany to lead the European transformation - in defense, energy, and the economy. But recently, The Economist wrote: "To fix Europe, Germany must first fix itself." My question is - how "broken" is Germany?
Christian Lindner: Thank you for this very delicate and diplomatic question. Allow me to divide my answer into two parts. First, I am convinced that Germany must lead the economic recovery of the European Union. We have lost competitiveness - both compared to other member states and domestically, within Germany itself. In 2014, Germany was ranked sixth in the Global Competitiveness Index. Currently, we are at 15th place. Last year we were already on 24th place. Therefore, the main goal of German policy in the coming years must be to restore the competitiveness of the economy. The second part of my response - and I believe this is exactly what The Economist means by "broken Germany" - is that we had a serious lack of public investments - in infrastructure and defense capabilities. Therefore, we must strengthen the capacity of the federal budget to invest - in infrastructure, in energy networks, and in new capabilities for the Bundeswehr - our army. While I was finance minister, my approach was to reprioritize within the budget - even under the old constitutional "debt brake," there were opportunities for more investments through redistribution. The new coalition has decided to change the "debt brake" itself in the Constitution, in order to open up a larger fiscal resource for public investments. And perhaps this move will prove successful - due to Donald Trump's unpredictable fiscal policy. So this "bet" may turn out to be a winner.
- You have 560 billion euros for the next 12 years. How will these funds be spent? How much will go to the army? Because Chancellor Merkel announced that Germany intends to create the largest conventional army in Europe. And how much will be invested in infrastructure?
Christian Lindner: We are delving deep into German domestic politics. Okay, I understand. There is a new additional budget - around half a trillion euros for infrastructure. The details are still being discussed, but the project bill proposed by the Ministry of Finance is focused on energy networks, transportation, schools, and hospitals. There is a very broad understanding of what constitutes "infrastructure," which is interesting. For example, investing in hospitals may be a political priority, but it may not necessarily lead to increased productivity or economic growth. In my opinion, this is a threat to fiscal sustainability. However, it is still being discussed within the government. And we must make a clear distinction between defense expenditures and those for infrastructure.
Svetoslav Ivanov: Let's talk about our friends across the ocean and the Trump effect on Europe. What is it like to be the biggest trading partner of a country or administration that is currently seeking "liberation" through tariffs?
Christian Lindner: Fragmentation of the international economy is a threat to all of us. I am a firm supporter of globalization. The global division of labor has brought prosperity. Hundreds of millions of people - perhaps even billions - have managed to overcome deep poverty thanks to the global division of labor. So, the fragmentation of the world economy is a serious threat to our well-being. And trade wars? They only have losers. No one can win a trade war. And Donald Trump knows that. He is aware of it. I will remind you of his comment about dolls. He said, "American children can play with two more expensive dolls instead of the 30 cheap Chinese ones they are used to." In other words, he is ready to accept a decline in the standard of living for Americans due to his protectionist policies. And I think this leads to some rationality in the Trump administration. I am convinced that there is no economic logic behind his customs policy. It's more about identity and perhaps national pride. His goal is to restore the industrial base of the American economy in order to bring back a sense of dignity for the working class in the USA.
- Okay, but how will this affect Europe? Because, you know, another quote from Trump - "Europe is worse than China." "They don't buy our cars." "They don't eat our beef."
Christian Lindner: So what's the price? Trump wants to punish consumers who, in his opinion, make the wrong choice. He punishes American children who want to play with 30 cheap Chinese dolls. And maybe he wants to punish European consumers who don't choose American cars. In other words - punishment for people. And that's why I'm convinced that there are no winners in trade wars. Having said that - perhaps we should ask ourselves the question: are we good as free traders?
Are we good?
Christian Lindner: No. We aren't.
No?
Christian Lindner: No. I'm not talking about tariffs. I'm giving an example with one of the most famous models of our car brands. This is an SUV - a car from a German manufacturer, but it's produced in the USA. When it's exported to the EU, tariffs are not a problem. But try to register this car in France! You'll have to pay a fee of thousands of euros - because of carbon emissions and the weight of the car. And now again - are we good free traders? No. Maybe Donald Trump is like a teacher for us - to urge us to think about our own values. Do we truly support free trade? Are we working hard enough to make progress in productivity? Are we making efforts to reduce bureaucracy and regulations in order to be more prosperous and innovative? So, in my opinion, Trump is an opportunity for us. An opportunity.
- And what do you think about Europe's strategy in the negotiations? You know it is claimed that the EU has prepared reciprocal tariffs worth 100 billion euros. But on the other hand - we will lose around half a trillion.
Christian Lindner: That is speculation.
Until this moment...
Christian Lindner: I know. I promise it will not turn out like that. That is just speculation. From time to time... We all love to speculate. But when it comes to tactics: First - we must make efforts to restore our competitiveness. Trump and his administration only respect strong partners. We have already talked about defense. We need to share and redistribute the burden with the Americans. And to show that we are ready to restore our competitiveness, in order to become an attractive economic partner again. Second - and this may surprise you, coming from a former politician - I think we are entering an era of corporate diplomacy.
Corporate diplomacy?
Christian Lindner: Corporate diplomacy.
What does that mean? The CEOs of the largest German automotive companies were in the US and met with Trump for 90 minutes. And individually negotiated with him on the issue of tariffs. And they achieved an exception for certain parts for automotive manufacturers. I think we need a comprehensive approach - the European Union, bilateral talks - by the way, the German Chancellor is currently visiting Donald Trump - and corporate diplomacy through global companies that Trump respects, because, for example, they produce cars in the US and have employees there. And this comprehensive strategy could influence the Trump administration.
- But if technologies and innovations are the main driver of wealth today, how do you perceive Mario Draghi's gloomy assessment that Europe is falling behind, aging and in stagnation? Do you agree with this assessment?
Christian Lindner: I agree with his assessment. But what are the consequences? Recently, I met with the CEO of an American technology company - a woman - and she told me, "Christian, the difference between you and us is that we want to innovate technologies, while you want to regulate them." In Brussels, there are two parallel attitudes. One is - in order to be competitive, we must unite our debts and pay subsidies and so on. The other is - we have regulated ourselves in such a way that innovations simply cannot happen in the European Union. Think about the Artificial Intelligence Act, for example. At the same historical moment, when the US announced $500 billion in private investments in artificial intelligence, an office for artificial intelligence with 140 employees, whose task is to regulate artificial intelligence, was opened in Brussels. And this is the difference, as the executive director said. I don't think we need more common funds or debt consolidation to pay even more subsidies to our industries.
By the way, when talking about innovation - does Trump's approach and his complex relationship with universities create an opportunity for Germany or Europe to attract talent - innovators, scientists, researchers?
Christian Lindner: Yes, obviously. But there is no automaticity in this. Capital, market share, intellectual property, scientists, the academic community as a whole - they are currently reassessing the European Union or Germany, for example. They are rethinking. But our strength right now is in the weakness of others. It is not in our own strength. But this is a window of opportunity, as I mentioned earlier in our conversation. Важното е да се постараем да станем членка на еврозоната, когато сме подготвени за това. And specifically - the freedom of science and research is guaranteed in Germany. But what if the equipment is outdated? We have the freedom of scientific activity, but in reality there is no progress because universities are underfunded, for example. So in order to use this window of opportunity - we must combine the supremacy of the law, which is now the strength of the European Union, with more investments in science and less regulations. Then the result can be very positive - for the EU, Germany or Bulgaria.
And finally - can you predict what Bulgaria will be like one year after adopting the euro? Can we expect something to generally change in our lives? Or in the economy? Or in the public atmosphere?
Christian Lindner: One year is a very short period. The important thing is to strive to become a member of the eurozone when we are ready for it. Let's say - three or four years. I expect the Bulgarian economy to grow and continue to grow. And the initial difficulties - the increased price level - will remain in the past. And then, after three to five years, public opinion will support the euro much more widely. I will end with this: there was skepticism towards the euro before Germany accepted it, as I already mentioned. Today, over 80% of Germans are convinced that their country has benefited from the euro. This is even higher than the average level in the EU. And perhaps the same will happen in Bulgaria after three to five years.
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