Welcome the newest Eurozone member: Latvia

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Latvia will become the 18th country to use the euro after being approved for membership by the European Commission.

In a report, the Commission confirmed that the Baltic state had met the criteria for joining the single currency.

Latvia is keen to strengthen ties with western Europe and reduce its dependency on Russia.

Officials said the eurozone had defied those who predicted it would collapse under the sovereign debt crisis.
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'Widespread enthusiasm'

The country will start using the currency at the beginning of 2014 after meeting the criteria for membership, including low inflation and long-term interest rates, as well as low public debt.

EU Economic and Monetary Affairs Commissioner Olli Rehn said Latvia's desire to adopt the euro was a sign of confidence in the single currency.

"Those who predicted a disintegration of the euro...were simply wrong," Rehn told a news conference.

The BBC Brussels correspondent, Matthew Price, said that unlike some established members of the zone, Latvia was well within the economic limits set by Brussels for joining.

"In much of Eastern Europe there's widespread enthusiasm - certainly among policy makers - for joining the single currency," he noted.

"However, polls suggest that many in the country are worried the switch could drive prices higher."

Anti-euro parties won more than half of the vote in elections in the capital, Riga, last weekend.
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Financial risk

Latvia underwent one of Europe's toughest austerity programmes after the 2008-2009 financial crisis knocked a fifth off its GDP.

It received a 7.5bn euro bailout in 2008, but it has now repaid the loans.

The membership still has to be approved by EU leaders and the European Parliament, but that is seen as a formality.

EU finance ministers are expected to sign off the accession in July.

The European Central Bank (ECB) also gave its blessing to Latvia on Wednesday ahead of the Commission's announcement, but warned high foreign deposits in its banks were a risk to financial stability.

"The reliance by a significant part of the banking sector on non-resident deposits as a source of funding, while not a recent phenomenon, is again on the rise and represents an important risk to financial stability," the ECB said.
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BBC News:.
 
After seeing the havoc that currency has caused across the continent I can't believe they still want to join
 
Magni said:
Say goodbye to French euros then.
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Well, we have to deal with our frenchy neighbours even being in schengen zone
TwlKCP9.jpg

So not many differences, and we still get english pounds and germany "euros" or russian "rubles" because I'm sure they will want to mantain their possessions, overhere f.e. the ones they have in Catalonia, Andalucia or Baleraric Islands.
 
Sylver said:
Well, we have to deal with our frenchy neighbours even being in schengen zone
TwlKCP9.jpg

So not many differences, and we still get english pounds and germany "euros" or russian "rubles" because I'm sure they will want to mantain their possessions, overhere f.e. the ones they have in Catalonia, Andalucia or Baleraric Islands.
Click to expand...

I was talking about all my friends down south who cross the border all the time because of the weather and cheap stuff, and how they would go a lot less if they had to worry about another currency.

They'd just go to Andorra instead for the cheap smokes and drinks and stay in France for the beach.
 
I met some Latvians at the Glastonbury festival once. They seemed alright, though i probably shouldn't judge the entire country on three of them.
 
Alucrid said:
Well let's hope they don't ignore the maastricht treaty like everyone else
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Ideally they would ignore it simply by not joining the Euro zone, which is a failed (and doomed) experiment intended to destroy Europe's social welfare state. It's basically an attempt to revive something like the gold standard in order to generate budget crises that require austerity. It's worked brilliantly so far from that perspective.

A country that does not join the Euro zone need not worry much about budget outcomes, because it retains the power to use its own currency to meet any obligations it assumes denominated in that currency.
 
Magni said:
I was talking about all my friends down south who cross the border all the time because of the weather and cheap stuff, and how they would go a lot less if they had to worry about another currency.

They'd just go to Andorra instead for the cheap smokes and drinks and stay in France for the beach.
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I remember when we have peseta and France had french franc. South french people came in mass without problems to our discoteches (sadly our politics killed Catalan discos and moved them to Ibiza). But I doubt this thing really change if this happens because we are the whorehouse of europe. "La Jonquera" is a great "circus" plus, as republican hard to say but true, thanks to our King oil costs us a little bit less than our northern mates, and alcohol is insanely cheap.
PS: You should try our beaches.
But if french people do not came here we should try to attract new markets. Maybe in few months UK is not a member of EU, they're our tourists first market (19,7%), from France is second (17,4%) and from Germany (15,2%).
 
Sylver said:
I remember when we have peseta and France had french franc. South french people came in mass without problems to our discoteches (sadly our politics killed Catalan discos and moved them to Ibiza). But I doubt this thing really change if this happens because we are the whorehouse of europe. "La Jonquera" is a great "circus" plus, as republican hard to say but true, thanks to our King oil costs us a little bit less than our northern mates, and alcohol is insanely cheap.
PS: You should try our beaches.
But if french people do not came here we should try to attract new markets. Maybe in few months UK is not a member of EU, they're our tourists first market (19,7%), from France is second (17,4%) and from Germany (15,2%).
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Me encanta España y sus playas.

I don't see what leaving the Euro and going back to the peseta would do for Spain honestly. What Europe (the Eurozone anyways) needs is one common budgetary strategy. Right now we have over a dozen different finance/economy ministers/secretaries for just one currency. Of course it doesn't work well.
 
Sylver said:
I remember when we have peseta and France had french franc. South french people came in mass without problems to our discoteches (sadly our politics killed Catalan discos and moved them to Ibiza). But I doubt this thing really change if this happens because we are the whorehouse of europe. "La Jonquera" is a great "circus" plus, as republican hard to say but true, thanks to our King oil costs us a little bit less than our northern mates, and alcohol is insanely cheap.
PS: You should try our beaches.
But if french people do not came here we should try to attract new markets. Maybe in few months UK is not a member of EU, they're our tourists first market (19,7%), from France is second (17,4%) and from Germany (15,2%).
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It'll be a few years before we even get a referendum nevermind leaving the eu :P
 
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