Vilnius, 04/07/2013 (Agence Europe) - Lithuania is hoping to push forward banking union during its six-month presidency of the Council of the EU, despite the fact that it cannot take part in it until it joins the eurozone in 2015.
Rimantas Sadzius, Lithuanian Minister for Finance, indicated on Thursday 4 July that his country did not currently wish to participate in the banking union mechanisms. Lithuania will do so automatically once it has adopted the euro in 2015. The minister admitted that Eurosceptics did exist in Lithuania and also pointed out that the eurozone had experienced a number of problems over the past few years. Nonetheless, he believes that the eurozone is capable of overcoming the crisis: “I think that the successive crises have brought new ideas on how to introduce supplementary instruments”. He also said that eurozone instruments are very good for helping resolve current problems that are related more to the banking system than the euro.
On the subject of banking union, the Lithuanian Presidency of the EU Council hopes to promote an inter-institutional agreement on directives framing national bank restructuring and deposit guarantee schemes (see EUROPE 10876).
It hopes to successfully complete the work of the Council on the single mechanism for bank restructuring that the European Commission is to propose next Wednesday. In the field of taxation, Lithuania hopes to gain unanimous agreement for revision of the savings tax directive. “We shall do our best, even if I cannot guarantee a positive result” (our translation throughout), Sadzius said in this respect. Other issues to be taken forward are: harmonisation of the common consolidated corporate tax base (CCCTB) and the financial transactions tax. The minister also said that, among other key issues, there was that of the 2014 budget and reform of cohesion policy 2014-2020.
“Introducing the euro is not the main goal. We want to build our economy on the necessary pre-requisites based on sound public finance”, Sadzius said. GDP growth in Lithuania was 3.7% in 2012 and should reach 3% in 2013. In 2014, 3.4% is forecast, and 4.3% in 2015. Growth, considered “sound and stable” is mainly due to exports, the minister explained, underlining the need for the country to restore domestic demand.
The country's unemployment rate is quite high (13.2% in 2012, 11.5% in 2013). The excessive public deficit procedure launched against the country was closed end June (deficit of 3.2% of GDP in 2012, expected to be 2.5% in 2013). The debt is expected to fall below 40% of GDP in 2013 (EU average 85.3%). (LC/transl.jl)