Lithuanian lawmakers urged to support laws for euro adoption

Lithuania's Prime Minister Algirdas Butkevicius on Tuesday urged lawmakers to approve draft laws necessary for euro adoption, which the Baltic country aims to realize next year. Butkevicius made the remarks at a meeting, expecting the draft Law of the Euro Adoption and its secondary legal acts to be passed in the parliament this month or next. "I believe that the members of Parliament will solidly support this and other leading acts that are designed to guarantee the financial stability (of Lithuania)," he said. The draft law was presented to the parliament at the end of January 2014. The document defines the procedure for preparations to adopt the euro, the changeover from lita to euro and the withdrawal of the national currency from circulation. It serves as a prerequisite to adopt the euro on Jan. 1, 2015, as anticipated. Earlier in January, Butkevicius said he would resign if Lithuania did not join the eurozone in 2015. A previous attempt of Lithuania to join the eurozone in 2007 failed after inflation marginally exceeded the EU's allowable limit. Lithuania's Baltic neighbors Estonia and Latvia adopted the euro in 2011 and 2014, respectively. If Lithuania joins the euro in 2015, it would become a symbolic move towards deeper EU integration. It is believed that adoption of the euro would affirm Lithuania's stance as a member of the core of the EU, achieving the aims set when the country regained its independence. The previous conservative Lithuanian government implemented painful fiscal reforms to pave the way towards the euro area membership. The current coalition continues to comply with the fiscal rules set by the EU. Experts at the Bank of Lithuania believe adopting the euro will lead to a significant increase in the country's export. "Even by conservative estimates, with the introduction of the euro, our exports will gradually increase by 5 percent. In addition, the disappeared currency risk will improve the conditions for business financing," said Vitas Vasiliauskas, Chairman of the Board of the Bank of Lithuania at a meeting last month. According to the economists, the adoption of the euro would have positive effect on the confidence of the people. It is expected that investing in Lithuania would become easier and safer for foreign investors, which helps to advance the economy and create new jobs in the long-run. According to figures from the European Commission, the Lithuanian economy grew by 3.2 percent in 2013 and is expected to reach 3.5 percent this year. The Commission saw inflation in Lithuania to slow to 1.2 percent last year and forecasts this trend to continue in early 2014. According to the Bank of Lithuania's calculation, Lithuania meets all criteria set by the EU to join the single currency union. The final decision on Lithuania's eurozone membership bid will be taken by the EU in July.