The Order and Justice party believes that Lithuania should hold a referendum before deciding on the euro switchover.
“All those discussions, whether it is worthwhile or not worthwhile to join the euro zone, are useless. I am always in favor of us joining the euro zone. When the time is ripe,” Prime Minister Andrius Kubilius, leader of the ruling Homeland Union – Lithuanian Christina Democrats (conservatives) said during the live debate organized by BNS news agency and Lietuvos Rytas Television on Sunday evening. He added that Lithuania had to comply with the Maastricht criteria irrespective of timing of euro adoption.
Finance Minister Ingrida Šimonytė, who also took part in the debate, noted that Lithuania had no alternatives to the euro.
“Several things have been mentioned – first of all, the currency board, a peg between the Lithuanian currency and the euro. Just as we saw before the crisis, we believed that everybody trusts this peg. However, the risk premiums started to grow at the end of 2008 and in particular in 2009, which showed that it was only us who trusted it while everybody else expected devaluation. It means that membership in the euro zone would eliminate that risk once and for all,” Šimonytė said.
“Contrary to 2005, when it [the membership] appeared to have only benefits..., now it [the membership] bears certain costs related with contributions to special stability mechanisms. However, those costs do not outweigh the benefits, which the state may use as an actual member of the euro zone – through better ratings, through smaller risk premiums, through cheaper borrowing for households and the state, and finally through access to the European Central Bank’s liquidity for the banking system. All these things are very important. If we do not intend to switch to a traditional central bank, and I think this idea would be quite Utopian, Lithuania will simply have no other choice,” the minister said.
Meanwhile, Valentinas Mazuronis, vice-chairman of Order and Justice party, said that Lithuania should not race to adopt the single currency.
“The adoption or non-adoption of the euro shall be useful or not as much as possible. We should not rush. We need a referendum – it shall be said by the citizens,” Mazuronis said.
Neringa Venckienė, chairwoman of the Path of Courage party, said that Lithuania now had no possibilities to adopt the euro.
“In general, Lithuania does not have an independent financial policy since the currency board is put in place in those countries where the central banks are not able to manage things. Lithuania has had the currency board for fifteen years now, which means that there is no independent financial policy. The Conservatives did not have any policy even during the crisis, the only policy was to borrow money incessantly... I think that we actually do not have that possibility [to adopt the euro] now,” she said.
Social Democratic leader Algirdas Butkevičius and Eligijus Masiulis, leader of the Liberal Movement, spoke in favor of euro switchover but pointed out that Lithuania should only join the euro zone after the crisis in Southern European countries was over.
“We are in favor of the euro, but it should be done at the time when it is useful for Lithuania,” Masiulis said.
Butkevičius pointed out that the adoption of the single currency was a question of time. At the same time, he noted that membership in the euro bloc was advantageous in terms of attracting investments and borrowing abroad.
