Lithuania adopts the euro

By bne IntelliNews January 5, 2015

Lithuania became the last of the Baltic States to adopt the euro on January 1, making another step to strengthen ties with Europe as geopolitical tensions rise in the region.

The euro is coming to a country that is expected to post economic growth of 3.1% in 2015, according to an estimate from the Bank of Lithuania, which revised its outlook from 3.3% in September. Long term, the euro is forecast to add 1.3% to GDP.

For now, however, Lithuania has a number of immediate issues to attend to. With the adoption of the common currency, Lithuania hopes to attract investment, as well as improve borrowing conditions. Underinvestment in particular is seen as a factor to deal with, suggests Swedbank. Another problem is the shrinking labour force. 

The agricultural sector continues to be influenced by Russia’s embargo on food produce, which has also hit the transport sector. Russia is also seen a bigger threat of late after it invaded Ukraine, having prompted Lithuania and its two other Baltic neighbours to increase defence spending, while trying to speed up severing whatever dependencies on Moscow may still exist. 

The reception of the euro amongst the population has been lukewarm at best, with polls showing approximately half of the country opposed to the switch over.

Related Articles

Latvia heads off Russian gas mischief with legislation on strategic companies

The Latvian parliament passed amendments to national security and commercial laws on March 23, handing the state the power to block the sale of companies considered strategic. The legislation will ... more

EU asks CEE to comment on Russian gas promises

The European Commission has invited comments from Central & Eastern European states on proposals put forward by Russian gas giant Gazprom to meet competition concerns. Visegrad and the Baltic ... more

EBRD says 2016 net profit was around €1bn

The European Bank for Reconstruction and Development (EBRD) said it made a net profit of around €1bn in 2016, up by a quarter from the €802mn it made in ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss