Latvia prepares for eurozone accession on 2014

Latvia prepares for eurozone accession on 2014

While Poland, Bulgaria and the Czech Republic have shelved plans to join the common European currency anytime soon, Latvia announced that it wants to become the 18th eurozone member on January 2014.

Recently, Poland, the Czech Republic and Bulgaria indicated that they would hold off on joining the single currency until the eurozone resolves its debt crisis. According to their accession treaties, all 12 members of the EU enlargement of 2004-2007, most of them from Central and Eastern Europe, have the obligation to join the euro as soon as they are ready.

Estonia joined the euro in January 2011 and has seen its economy grow.

In Lithuania, a non-eurozone member that is due to assume the rotating EU presidency in the second half of 2013, the economy had a good year in 2011 and economic activity is expected to increase by 2.4% in 2012.

During the economic crisis, Latvia's economy plummeted 18%, the worst in the European Union, and it became the first EU country to seek a bailout - €7.5 billion - from a group led by the International Monetary Fund. Since then, the situation greatly improved, but the country still has to correct its excessive deficit, fight unemployment and tackle the high rates of poverty.

The Bank of Latvia forecasts that switching to the euro would boost the county’s real GDP by 7.4%, investment by 15.9%, exports by 5% and would lower long-term interest rates by half a percentage point by 2020.

An August survey of more than 1,000 Latvians by the Latvijas Fakti pollster showed that just 35% supported euro adoption with 59% declaring themselves against and 6% undecided.

So it is time to think about company formation and company registration in Latvia.