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Why little Lithuania wants the euro

Monday, December 22, 2014 - 01:45

Lithuania is about to become the last of the Baltic states to join the euro zone currency bloc. As Jacob Greaves reports it's hoping for more investment and lower borrowing costs to spur one of Europe's poorest economies.

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Buying into the euro. 2015 could be a another gloomy year for the currency but one country is staking its future on a more positive outlook. On January the 1st Lithuania will join the euro zone. In doing so the Baltic state will take another step west, away from its Russian neighbour. Algirdas Butkevicius is the country's Prime Minister. (SOUNDBITE) (Lithuanian): LITHUANIAN PRIME MINISTER, ALGIRDAS BUTKEVICIUS, SAYING: "I think that first of all we have to understand that some businesses have to change their view and their thinking about risky markets like Russia. They must understand that a business can't always have a 15-20 percent profitability, like they used to have in Russia." But if stability is the buzz word, the euro may not be the first currency that comes to mind. December saw it hit a 2 year low against the dollar as the region's economies once again flirt with recession. Meanwhile, political turmoil in Athens could see the government fall, and revive the spectre of a Greek euro exit. But despite the concerns, the thoswe in Lithuania hope it will be business as usual. Visvaldas Matijosaitis is CEO of the Viciunai Group (SOUNDBITE) (Ltihuanian) CEO OF THE "VICIUNAI GROUP," VISVALDAS MATIJOSAITIS, SAYING: "It changes nothing. Because even today Lithuania's litas is strongly pegged to the euro. In our business nothing changes, it's just we'll be handling different paper slips. And the numbers will be smaller on our transactions." On the country's new year wish list will be a rise in productivity- similar to the likes seen in neighbouring Baltic states after they joined the euro. Also on the cards is cementing a pivot away from Russia. Moscow's intervention in Ukraine has Vilnius worried it could be next in the firing line. Just last month Lithuania's president lambasted Russia as a 'terrorist country'. If nothing else, entry into the euro should move the country further out of Moscow's shadow.

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Why little Lithuania wants the euro

Monday, December 22, 2014 - 01:45