Latvia signs formal request to join euro area
Baku, March 5 (AZERTAC). Latvia has formally applied to adopt the euro currency 2014, a move that could see the Baltic state become the bloc`s 18th member.
The move had been expected and comes after Latvia met the required financial criteria, including levels of state debt, budget deficit and inflation.
Polls, however, indicate that nearly two-thirds of Latvia`s population is against swapping the lat for the euro, which only last year some investors were betting would collapse.
A government spokesman said Monday that the formal request would be given to the European Union`s Monetary Affairs Commissioner, Olli Rehn, on March 5 in Brussels.
The commission, along with the European Central Bank, will likely decide on Latvia`s request in June.
Baltic countries with a population of 2 million people have the ambition of January 1, 2014 to become the 18th member of the European Union, using the euro single currency.
"In March, Latvia will ask the European Commission to report on convergence, concluding that fulfill the Maastricht criteria," said Dombrovskis told parliament.
He said he expects the European Commission to submit an application to Latvia`s finance ministers and government leaders in June, then in July after the European Central Bank (ECB) gives the final green light.
He said euro membership would increase the flow of investment, lower interest rates and transaction costs.
In late January, Latvia`s parliament approved on second reading the final developed by the Treasury for the introduction of the single European currency on 1 January 2014. According to Latvia`s Dombrovskis entry into the eurozone will allow the country to put a symbolic end to the period of reform and will ensure further sustainable development.
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