G. Skaistė: "Membership in the euro area strengthened the resilience of the Lithuanian economy to external shocks"
At the conference held in Riga, dedicated to the decade of the introduction of the euro in Latvia, Minister of Finance Gintarė Skaistė emphasized that the introduction of the euro strengthened the ability of Lithuania and all the Baltic countries to withstand economic shocks. In the face of recent shocks, being part of a single monetary union helped maintain investor confidence and favourable financing conditions. This created the conditions for the Government to undertake the necessary stimulating fiscal policy in time, which mitigated the impact of the shocks on the real economy and the country's population.
"The experience of recent years – from the COVID-19 pandemic to russia's war against Ukraine – has shown that Lithuania made the right decision by joining the euro area. This step not only deepened Lithuania's political integration in the direction of Europe, but also significantly strengthened the resilience of our economy to shocks. Being part of the euro area family, we were in a better position to stimulate the economy at the right time with sufficient volume, which helped to avoid economic recession and unemployment. From a longer perspective, membership in the euro area laid a solid foundation for further economic convergence with Western European countries," said G. Skaistė.
The discussions were also held on what actions are needed so that the membership in the euro area will bring even greater benefits to the member countries. In this regard, the Minister emphasized that there is still a lot of room for reforms at the European Union level, which could strengthen the efficiency of the common economic space and increase the benefits of the euro. Among the most important directions of reforms, the deepening of the single market for services was emphasized, which must also include the digital space. Also, in the new political cycle, it is necessary to make significant progress in developing the EU Capital Markets Union, ensuring more and more diverse financing opportunities for businesses, and more effective savings instruments for residents.
The Minister also emphasized that historical examples show that the benefits of the euro usually come together with a prudent macroeconomic policy. Therefore, in order to continue to enjoy the positive impact of the euro on international trade and economic growth, it is necessary to maintain sustainable public finances. It is also necessary to implement structural reforms and growth-promoting investments, which, as economic convergence continues, would ensure the competitiveness of the economy in the international context.
Last updated: 07-02-2024
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