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Latvia Set to Join Euro Currency Bloc in 2014

Latvia is poised to become the 18th country to join Europe's euro currency bloc next year, at a time when the region is battling an extended recession and record unemployment.

The European Commission, which sets policies for the European Union, and the European Central Bank say the Baltic country has met the economic requirements to join the eurozone on January 1.

Europe's economic chief, Olli Rehn, said Latvia's move to join the eurozone is a signal of support for the region, offering evidence that critics predicting the demise of the currency union were wrong.

"Latvia's prospective euro adoption is a strong signal to the region, to the euro area and to the global community and world markets at large. This underlines the integrity of the euro and shows that sustained and stability-oriented policy actions generate concrete results and that economic reforms pay off.''

The eurozone is mired in a recession that has lasted 18 months, the longest since use of the euro was initiated in 1999, and more than 19-million workers are unemployed. The bloc has sent billions of dollars in bailouts to five countries to keep them from going bankrupt.

But Latvia is viewed as a European economic success, recovering from a 2008 banking crisis by adopting austerity measures and cutting government spending.

Latvia has an annual economic output of about $26 billion, and is forecast to have the European Union's fastest growing economy this year.

However, the move to join the eurozone is not popular inside the nation of 2.2-million people, with surveys showing widespread opposition to abandoning the lat, Latvia's currency, in favor of the euro.

But Prime Minister Valdis Dombrovskis said he thinks adoption of the euro will increase investment in the country and improve its credit rating.