News / Europe

Latvia to Get Green Light for Eurozone Membership

Reuters
The European Commission will give Latvia on Wednesday the go-ahead to become the 18th member of the eurozone from the start of next year, European Union officials said on Monday.
 
The EU executive will publish a report on whether the small Baltic state meets all the criteria for membership of the single currency, which include low inflation and long-term interest rates, a stable exchange rate and low public debt and deficit.
 
Latvia, which underwent one of Europe's toughest austerity programs after a 2008-2009 crisis wiped a fifth off its GDP, meets all the requirements, the Commission will say.
 
“The decision on Latvia is positive,” one EU official said.
 
Policymakers hope the accession of Latvia will send a strong signal of confidence to investors that despite three years of a sovereign debt crisis, the eurozone is set to grow, rather than disintegrate.
 
The European Central bank will also publish its view on whether Latvia should be allowed to join, but it is only the Commission that has the right to make a legal recommendation.
 
Latvia's membership will have to get the approval of EU leaders at their summit in late June, and the European Parliament will also have to be consulted, before EU finance ministers make the accession formal in July.
 
Latvia's Baltic neighbor, Lithuania, is likely to become the nexteuro zone member after Latvia from 2015, a senior euro zone policy-maker said earlier in May. The third Baltic country, Estonia, joined the eurozone in 2011.
 
To adopt the single currency, Latvia reduced its budget deficit to below the EU ceiling of 3 percent of gross domestic product last year, cutting it to 1.2 percent.
 
Its public debt is around 41 percent of GDP, well below the EU ceiling of 60 percent and its currency has been pegged to the euro since it joined the European Union in 2004.
 
To keep the fixed peg to the euro throughout its economic crisis, Latvia underwent a painful internal devaluation, slashed public sector wages, cut spending and hiked taxes.
 
Latvia posted the fastest economic growth in the EU with 5.1 percent year-on-year and 1.3 percent quarter-on-quarter in the last three months of 2012 but it is still one of the poorest countries in the EU, along with Bulgaria and Romania.
 
Latvian officials are keen to join the euro because many mortgages are denominated in the single currency which they see as less risky than the lat in the longer term.
 
Latvia also wants to strengthen its links with western Europe and be less dependent on Russia. Trade links with Russia are still strong but relations between the two countries can be complicated.
 
Moscow often accuses Latvia of violating the rights of the large Russian-speaking minority. Riga wants Russia to recognize the 1940 Soviet invasion as occupation.
 
While officials are keen on the euro, polls show much of the population is worried a switch will drive prices higher and the country will lose power to Brussels.

You May Like

Republican Majority in Congress Off to Rough Start

Standoff over Homeland Security funding exposes philosophical, tactical problems within party More

Pakistan Blocks Baloch Activist from US Trip

Human Rights Commission of Pakistan slams Islamabad officials for stopping people from leaving country to attend human rights conference More

Video Muslims Long Thrived in North Carolina Before Students Killed

Idyll shattered February 10, when three Muslim university students living in Chapel Hill were gunned down by a neighbor More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Muslims Long Thrived in N Carolina Before Slaying of 3 Studentsi
X
Jerome Socolovsky
March 05, 2015 9:04 PM
The killings of three Muslim students in North Carolina early last month came as Muslims across the United States have felt under siege, partly as a result of terrorist attacks being committed internationally in the name of their faith. But Muslims have long thrived in university cities in this part of the American South. VOA's Jerome Socolovsky reports.
Video

Video Muslims Long Thrived in N Carolina Before Slaying of 3 Students

The killings of three Muslim students in North Carolina early last month came as Muslims across the United States have felt under siege, partly as a result of terrorist attacks being committed internationally in the name of their faith. But Muslims have long thrived in university cities in this part of the American South. VOA's Jerome Socolovsky reports.
Video

Video Fuel Shortages in Nigeria Threaten Election Campaigns

Nigeria is suffering a gas shortage as the falling oil price has affected the country’s ability to import and distribute refined fuels. Coming just weeks before scheduled March 28 elections, the shortage could have a big impact on the campaign, as Henry Ridgwell reports for VOA.
Video

Video Report: Human Rights in Annexed Crimea Deteriorating

A new report by Freedom House and the Atlantic Council of the United States says the human rights situation in Crimea has deteriorated since the peninsula was annexed by Russia in March of last year. The report says the new authorities in Crimea are discriminating against minorities, suppressing freedom of expression, and forcing residents to assume Russian citizenship or leave. Zlatica Hoke has more.
Video

Video 50 Years Later African-Americans See New Voting Rights Battles Ahead

Thousands of people will gather to mark the 50th anniversary of a historic civil rights march on March 7th in Selma, Alabama. In 1965, dozens of people were seriously injured during the event known as “Bloody Sunday,” after police attacked African-American demonstrators demanding voting rights. VOA’s Chris Simkins introduces us to some civil rights pioneers who are still fighting for voting rights in Alabama more than 50 years later.
Video

Video Craft Brewers Taking Hold in US Beer Market

Since the 1950’s, the U.S. beer industry has been dominated by a handful of huge breweries. But in recent years, the rapid rise of small craft breweries has changed the American market and, arguably, the way people drink beer. VOA’s Jeff Custer reports.
Video

Video Video Claims to Show Shia Forces in Iraq Executing Sunni Boy

A graphic mobile phone video is spreading on the Internet, claiming to show Iraqi forces or Shia militia executing a handcuffed Sunni boy. Experts have yet to verify the video, but already Islamic State followers are publicizing it across social media, playing on deep-rooted sectarian fears. VOA’s Jeff Seldin reports.
Video

Video Ukrainian Authorities Struggle to Secure a Divided Mariupol

Since last month's cease-fire went into effect, shelling around the port city of Mariupol has decreased, but it is thought pro-Russian separatists remain poised to attack. For the city’s authorities, a major challenge is gaining the trust of residents, while at the same time rooting out informants who are passing sensitive information to the rebels. Patrick Wells reports for VOA.
Video

Video Volunteer Gauge-Watchers Help Fine-Tune Weather Science

An observation system called CoCoRaHS is working to improve weather science, thanks to thousands of volunteers across the country who measure precipitation in their own backyards, then share their data through the Internet. VOA's Shelley Schlender reports.
Video

Video NASA Spacecraft Approaches a Dwarf Planet

NASA’s Dawn spacecraft will make history on Friday, March 6, when it becomes the first man-made object to orbit a dwarf planet named Ceres. It is located in the asteroid belt between Mars and Jupiter, almost 500 million kilometers from Earth. Among other objectives, Dawn will try to examine two mysterious bright white spots detected on the planet’s surface. VOA’s George Putic has more.
Video

Video Young Muslims Radicalized Online

Young Muslims are being radicalized ‘in their bedrooms’ through direct contact with Islamic State or ISIL fighters via the Internet, according to terror experts. There are growing concerns that authorities and Internet providers are not doing enough to counter online extremism - which analysts say is spread by a prolific network of online supporters around the world. Henry Ridgwell reports from London.
Video

Video Positive Messaging Transforms Ethiopia's Image

Ethiopia was once known for famine and droughts. Now, headlines more often point to its fast-growing economy and its emergence as a regional peacemaker. How has Addis Ababa changed the narrative? VOA's Marthe van der Wolf reports.
Video

Video Answers Elude Families of MH370 Passengers

For the families on board Malaysia Airlines flight MH370, an airline official’s statement nearly one year ago that the plane had lost contact with air traffic control at 2:40 AM is the only thing that remains confirmed. William Ide reports.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More