06. january 2014

Latvia becomes the 18th Euro-Zone country

In 2014, Latvia becomes the 18th Euro-Zone country. LVL to EUR exchange is ensured at the official rate: EUR1 to LVL0.702804 that is 70.3 santims. Latvians’ deposits and credits in LVL are converted into EUR at this rate. Lats will cease to be a statutory means of payment in Latvia from 15th January.

As Mario Draghi, the President of the European Central Bank (ECB), stated during his visit to Riga this autumn, by entering the Euro-Zone, Latvia would secure its place in the “heart” of Europe, as it would participate in monetary policy-related decision-making concerning the entire Euro-Zone.

The editor of British Economist, Edward Lucas, also believes that there will be more positive sides of entering the Euro-Zone for Latvia than negative ones: transaction charges will be eliminated in foreign trade, lending expenses will be reduced, investments will grow. Moreover, entering into the Euro-Zone secures an inadequately great influence in the core EU for a small country.

Governmental authorities have also promised that entering into the Euro-Zone will be beneficial for the entire country, its inhabitants and businessmen: there will be no conversion charges, no concerns relating to the devaluation of the lats, the state will be more stable from the investors and rating agencies’ perspective. At the same time, in the economist’s opinion, the Euro is not a magic wand to ensure immediate growth.

Source: delfi.lv

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