What's good for Estonia is bad for Latvia?
09.02.2010, 09:56Latvian officials say that Estonia's adoption of the euro will worsen the economic situation in Latvia and affect Latvia in the early stage.
"Every investor and every manufacturer who is planning an investment would choose the country that has adopted the euro and where he does not have to hear rumours about possible change of exchange rate," said Ilmārs Rimšēvičs, governor of the Latvian central bank, said recently in an interview to AFP.
Latvian finance minister Artis Kampars agrees. "I think that when Estonia joins the eurozone, as it undoubtedly will, it will be one step ahead of Latvia," said Kampars. Latvia plans to adopt the euro only in 2014.
Estonia's own officials see the euro as a way to increase confidence in the Estonian economy, attract more investments and create new jobs.
This view is shared also by Swedbank that says the euro would reduce risks in the Estonian economy and could direct some investments away from Estonia's neighbours into Estonia. "We expect Estonia to become more attractive as an investment destination and contribute to economic growth in 2011."