Transition of Latvia to euro from 1 January 2014 allows us today to remember how this transition proceeded in the neighbouring Estonia three years ago and the outcomes by the end of the first year of living in eurozone.
There seems to be pessimism in the air regarding the economic prospects of the West and by extension the world. In its recent report, the Organization for Economic Co-operation and Development (OECD) revised downward its estimates of growth for many countries. It lowered the overall growth rate forecast of the Euro Zone for 2013 and 2014 each by 0.5 per cent. For the entire OECD, the forecast has been lowered by 0.6 per cent for 2013 and 0.2 per cent for 2014.
As far as Germany is concerned, the drama of the euro crisis is over. The subject was barely discussed in the country’s recent election campaign. Chancellor Angela Merkel did what was necessary to ensure the euro’s survival, and she did so at the least possible cost to Germany – a feat that earned her the support of pro-European Germans as well as those who trust her to protect German interests. Not surprisingly, she won re-election resoundingly.
Latvia will join the eurozone on January 1, 2014. In 2009, Latvia almost went bankrupt, but recovered surprisingly quickly. Can its path to recovery serve as a blueprint for other European countries?
In case you haven’t noticed, the great European crisis is the biggest political game changer in postwar history.
The Government has decided that Lithuania must have the euro by 2015, whatever the cost. Finance Minister Rimantas Šadžius, though, admits that ordinary people are a little suspicious of a currency switch – remember as they do the last monetary reforms in the country that went less than smoothly.
The European Commission has warned of deepening economic problems in France, Italy and Spain, and said Slovenia must take urgent steps to offset the risk of a wider destabilisation across the eurozone.
Who has invented the tax on Cyprus bank accounts, which the Parliament of the island country doesn’t want to approve? The European Central Bank is trying to lay the blame on the President of Cyprus, and he, in his turn, blames the governments of the Eurozone countries. Meanwhile the issue, as well as the accounts in Cyprus banks have hung up for indefinite period, as they have not yet been able to “break” the MPs. Moscow also tries to take part in the resolution of this problem, which was appointed beyond its will as a “title sponsor” of Cyprus stabilization.
Estonia's President Toomas Hendrik Ilves says he would like Lithuania and Latvia to join the euro zone as soon as possible, adding the accession would enhance the Baltic influence "in the so-called European core."
Like many other regions around the world, Central Europe (CE) was profoundly affected by the global economic crisis. This article discusses the way CE countries have been handling the effects of the global crisis in the region by looking into changes in the macroeconomic indicators over the past 2 years.