EU executive says Lithuania ready to join eurozone

The European Union announced Wednesday that it has made a preliminary decision to accept Lithuania’s application to adopt the euro.

Olli Rehn, the EU's top monetary affairs official, said Lithuania is ready to become the eurozone's 19th member, out of the European Union's membership of 28. The eurozone's current members are due to make a decision on Lithuania's application at some stage next month. Following the EU's recommendation, which is considered a foregone conclusion, Lithuania will be able to formally adopt the joint currency at the start of next year.

Lithuania's move to join is another vote of confidence in the euro, which launched in 1999 but has suffered a half-decade of financial stress following debt problems in a number of countries, such as Greece and Spain.

After a series of debt-reduction measures and a raft of structural changes, however, the euro's future is rarely questioned now even though the eurozone economy continues to underperform its counterparts around the world.

Lithuanian Prime Minister Algirdas Butkevicius said adopting the euro was an "economically and politically measured strategic step" that could boost growth and living standards in the country of 3 million.

The country's president, Dalia Grybauskaite, who was one of the firmest advocates for joining, said Lithuania "deserves to be in the club of the strongest."

"We will be able to borrow at lower costs," she said. "This will allow us to spend more money on pensions and other needs."

Lithuania's Baltic neighbors, Estonia and Latvia, are already members of the euro. All three countries achieved independence from the Soviet Union in 1991.

A vociferous anti-EU lobby in Lithuania had requested a referendum, but it was turned down by electoral officials.

Describing the expected membership as "only the beginning of the road," Lithuanian Finance Minister Rimantas Sadzius said it was important "to ensure that the euro is welcomed by the residents, and its arrival is smooth."

The Associated Press