Analytics, Economics, EU – Baltic States, Financial Services, Latvia, Legislation

International Internet Magazine. Baltic States news & analytics Friday, 26.04.2024, 20:11

PM: Latvia must stick to euro plan despite vote calls

Nina Kolyako, BC, Riga, 13.12.2012.Print version
Latvia must not lose steam in its drive to adopt the euro, Prime Minister Valdis Dombrovskis said on Wednesday, amid calls for a referendum on the planned 2014 move, the AFP news agency reports.

Dombrovskis told public television that Latvia must not "fall behind schedule" in its bid to become the 18th member of the eurozone on January 1, 2014.

 

Polls show the Latvian public is skeptical about switching from the national currency, the lat, but the Dombrovskis government has brushed off calls from the left-leaning opposition for a plebiscite, writes LETA/AFP.

 

He is now facing dissent within his own three-party coalition government, however, as a number of members of All for Latvia!-For Fatherland and Freedom/LNNK speak out in favor of a public vote.

 

"We are working on it, so that we don't stumble at the first step," Dombrovskis said, when pressed on the divisions.

 

Dombrovskis and other pro-euro ministers underline that the public backed the eventual adoption of the euro as part of a wider 2003 plebiscite that enabled Latvia to join the European Union the following year.

 

Despite raising the prospect of a vote, no eurosceptics have launched formal moves to collect signatures to force a referendum, as required under Latvian law, AFP writes. Unfazed by the eurozone crisis the government argues that it makes sense for a small economy to join the troubled monetary bloc given that its main trade partners are already inside.

 

Latvia's business sector also backs the move, with a Chamber of Trade and Commerce survey released Wednesday showing that 65 percent of members favor the euro switch. Latvia aims to follow Estonia, which entered the eurozone in 2011. The third member of the Baltic trio, Lithuania, is eyeing 2015.

 

All three Baltic States have emerged from what have been among the deepest recessions in the world, and have imposed austerity measures far beyond those applied by West European countries.

 

AFP points out that Latvia has been hailed by organizations such as the International Monetary Fund as an example of austerity bearing fruit thanks to its early completion of a three-year, EUR 7.5-billion (USD 10 billion) international bailout program, writes LETA.

 

While its economy is yet to recover to pre-crisis levels, Latvia's rebound has pushed it to the top of the EU growth table, with output expanding by 5.2 percent in the third quarter compared with the same period of 2011.

 

Dombrovskis told reporters that the euro adoption issue is so important that the bill is also being discussed with opposition parties, as the government is obligated to do so.

 

"Here we have a lot of government vs. opposition tug-of-war, but this issue is much too important for such game playing," the prime minister commented, reminding that "at least one opposition party", the Greens/Farmers Union, has supported adoption since the decision was made, including the date – 2014.

 

Dombrovskis underlined that at this time the plan is for the euro bill to be passed at next Thursday's session of Saeima.

 

He also expressed hope that he has been able to convince the dissenters in the national VL-TB/LNNK alliance, and that it – tonight – will announce its decision, one that is "responsible, well-weighed, balanced and justified."






Search site