Latvia needs to carefully follow what is going on in the European Financial System, but despite the immediate difficulties, when joining the Eurozone, benefits outweigh loses, President of the Bank of Latvia Ilmars Rimsevics is convinced.

Ilmars Rimsevics

By joining the Eurozone, Latvia would be spared such shocks as the end of 2008, the beginning of 2009, when it was unknown whether Lat was to be devalued or not, and the fear of unknowing this paralyzed the national economy. Also, euro would allow Latvian commercial banks to receive loans from the European Central Bank during times of crisis, which would protect us from the re-occurrence of the Parex Bank collapse type of situation, President of the Bank of Latvia said in an interview to Neatkariga Rita Avize newspaper.

In the eyes of investors Latvia would be a safer country than it is today – the difference in ratings between Latvia and Estonia right now are six levels – this is why foreign investors are more open to investing money in Estona, Rimsevics adds.

At the same time he notes that euro is not a miracle tool, and does not give any short term grandiose results; however, in a long term perspective a united currency guarantees cheaper financing, and, when used appropriately, directed towards developing production, instead of real-estate, it helps investments and overall development.

Ref: 102.109.109.1170