The Bulgarian currency: the leva
The Bulgarian currency is the LEV, or LEVA in plurial.
The exchange rate of the LEV to the 'EURO has been fixed and unchanged since 1999.
It takes 1,95583 BGN to have 1 EUR.
Recent history of the LEVA
On the 15th February 1997, the Bulgarian government decided to introduce the Monetary Board.
The Monetary Board started to function on the 10 juin 1997 when the Bulgarian parliament voted a law that restructured the National bank of Bulgaria.
This law fixed the rate of exchange at 1.000 old leva for 1 new Lev (1 BGN) for 1 German mark (1 DEM) and obliged at the same time the National Bank of Bulgaria to buy and sell marks against Leva. The law also recalculated the exchange rate of the lev to the euro (this took place in 1999). Since 1999, 1 EUR is equivalent to 1,95583 BGN.
The introduction of the Monetary board came after a very big economic crisis which reached its peak in 1996. This crisis brought many devaluations ( the reserves of the National Bank were literally melted because the national Bank was trying to maintain an exchange rate of the lev to the dollar by buying leva and selling dollars while it printed leva to refinance the banks and finance the budgetary deficit….), bank failures, hyperinflation, fall of governmements, murders of politicians….
Asked for help, the FMI required the introduction of the monetary board.
The main advantages of the Monetary Board on the economy have been:
- The economic growth
- The increase of the foreign investments
- The budgetary balance
Since its introduction and the positive effects, the monetary board has become one of the most respected Bulgarian institutions.