Inflation seems to be the main obstacle that could make Bulgaria fail to meet its schedule for joining the eurozone in 2009 or 2010, according to the latest report of Bank Austria Creditanstalt (BA-CA), local newspaper PARI reported on Wednesday.

Bulgaria performs excellently in meeting the Maastricht criteria, except for its rate of inflation, which stood at five percent in 2005, the report said. Harmonized inflation is a prerequisite for joining the euro.

Bulgaria has been under substantial inflationary pressures as a result of its agriculture sector being heavily hit by last summer's floods, the report said.

Transport, healthcare, liquor and cigarettes in Bulgaria have witnessed the highest annual price increases. These are also diversions from the EU average, BA-CA analysts said after comparing official data issued by the EU statistical agency, Eurostat.

Pre-accession harmonization among all sectors is the key inflation driver.

In industry, both EU-aspirants Bulgaria and Romania began to pick up speed again in recent months.

The major influencing factors during 2006 remain the strength of the national currency (the lev), the price of oil and adjustments to regulated prices and taxes, according to the forecast by the BA-CA.

Source: Xinhua