Wednesday

21st Feb 2018

Latvia aiming to join eurozone in 2014

After being one of the first EU countries in need of a bail-out in 2008, Latvia is slowly recovering and aiming to join the eurozone on 1 January 2014, despite current problems in the single currency area, the country's newly elected president told this website.

"Personally I'm very optimistic we'll join the euro on 1 January 2014. It's our goal and we are working hard to implement this process", Andris Berzins said while on his first courtesy visit to Brussels earlier this week.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

He added that the accession of his country to the single currency area would be "of course dependent of the eurozone stability, which I hope will come by the end of the year".

The remarkable turn of Latvia's economy, now having a growth rate of five percent after an 18 percent contraction in 2009, is mainly due to a harsh austerity program accompanying a €7.5 billion EU-IMF bail-out agreed in December 2008.

Unemployment, however, was the price to pay, with Latvia having 16.2 percent in the first quarter of 2011, the second-highest rate in the EU after Spain. But EU statistics also show that unemployment is decreasing rapidly compared to last year, when the rate was almost 20 percent.

Berzins, a member of the Union of Greens and Farmers party, says that people living in the countryside are the most affected and that is why his message to the EU is not to cut back on farm subsidies in the next seven-year budget.

"For Latvia the Common Agricultural Policy (CAP) is very important. Particularly the direct payments per hectare, to keep employment in the rural areas", he said.

A country of 2.2 million people, Latvia still relies heavily on agriculture, with almost 50 percent of the population residing in rural areas. "And our countryside regions are the most affected by the budget consolidation process. We still have the situation that people are leaving Latvia to find better place, we have to stop that and bring them back", the president said.

As for the situation in Greece, Berzins, a former privatisation manager, said that "it would be more than useful to get answers how it happened, why they were able to go so deep and not stopped earlier. It means the European Central Bank didn't act in the best way, allowing such a high debt for Greece".

In his view, creating more control mechanisms in the eurozone is necessary to prevent another Greek scenario from happening again.

"Eurozone leaders have announced they will be very strict in this consolidation process, but it's not the easiest and it takes time step by step in reducing this big debt burden. Latvia managed in relatively short time, but the situation is still complicated and we have to find ways for future growth in our country", he noted.

As for neighbouring Estonia, who became a member of the eurozone at the beginning of this year, Berzins said that it is "too early" to say if that move had a positive impact on trade relations with Latvia.

"I hope this is a very positive example for all three Baltic states and that is an explanation why we are ready to follow. We were together, we are together and we remain the closest economic partners", he stressed.

Recently-elected Latvian President Andris Berzins spoke to the EUobserver during his first visit to Brussels.
Latvian turmoil will not affect government, MEPs say

The Latvian government will not be affected by the decision of the country's president to dissolve the parliament for having refused to allow a corruption probe into the dealings of one of its members, two MEPs told this website.

Greece wants EU to use old Latvia fund for bail-out

Greek leader George Papandreou and Socialist parties across Europe have called on the EU to re-deploy for Greece an existing European bail-out fund originally established to rescue Latvia, Hungary and Romania.

Baltic states demand bigger EU budget

The leaders of Estonia, Latvia, and Lithuania say in a joint letter that they are open to talks on creating "new own resources" for a bigger EU budget after the UK leaves the EU.

Analysis

We are not (yet) one people

Talks on the next EU budget will start on Friday. Brussels wants to do much more than before – and needs a lot more money. But arguing about funds won't be enough.

News in Brief

  1. Belgian PM to host 11 EU leaders ahead of summit
  2. Tusk all but rules out pan-EU candidates in 2019 elections
  3. Tusk: EU budget agreed before 2019 elections 'unrealistic'
  4. Commission fines car cartels €546m
  5. Juncker: 'nothing' wrong in Katainen meeting Barroso
  6. Juncker appoints new head of cabinet
  7. MEPs decide not to veto fossil fuel projects list
  8. Factory relocation risks drawing Vestager into Italian election

Stakeholders' Highlights

  1. Aid & Trade LondonJoin Thousands of Stakeholders of the Global Aid Industry at Aid & Trade London
  2. Macedonian Human Rights Movement Int.European Free Alliance Joins MHRMI to End the Anti-Macedonian Name Negotiations
  3. International Climate ShowSupporting Start-Ups & SMEs in the Energy Transition. 21 February in Brussels
  4. Mission of China to the EUChina-EU Tourism Year to Promote Business and Mutual Ties
  5. European Jewish CongressAt “An End to Antisemitism!” Conference, Dr. Kantor Calls for Ambitious Solutions
  6. UNESDAA Year Ago UNESDA Members Pledged to Reduce Added Sugars in Soft Drinks by 10%
  7. International Partnership for Human RightsUzbekistan: Investigate Torture of Journalist
  8. EPSUMovie Premiere: 'Up to The Last Drop' - 22 February, Brussels
  9. CESICESI@Noon on ‘Digitalisation & Future of Work: Social Protection For All?’ - March 7
  10. UNICEFExecutive Director's Committment to Tackling Sexual Exploitation and Abuse of Children
  11. Nordic Council of MinistersState of the Nordic Region 2018: Facts, Figures and Rankings of the 74 Regions
  12. Mission of China to the EUDigital Economy Shaping China's Future, Over 30% of GDP

Latest News

  1. UK seeks flexible transition length after Brexit
  2. Commission defence of Barroso meeting leaves 'discrepancies'
  3. MEPs bar WMD and killer robots from new EU arms fund
  4. Canete gets EU parliament pension while still commissioner
  5. Bank of Latvia sends deputy to ECB amid bribery probe
  6. We are not (yet) one people
  7. Intellectual property protection - the cure for Europe's ills
  8. Eastern states push back at rule of law conditions on funds