BRUSSELS (Reuters) - Lithuania is set to become the 19th European Union country to adopt the euro currency from the start of 2015. Below are the main criteria that Lithuania had to meet to be accepted into the euro zone.
INFLATION
Cannot be higher than 1.5 percentage points above the rate of the three best performing EU countries.
"Lithuania's average inflation rate during the 12 months to April 2014 was 0.6%, well below the reference value of 1.7% for the same month, and is likely to remain below the reference value in the period ahead," the Commission said.
GOVERNMENT DEFICIT
Cannot be higher than 3 percent of gross domestic product (GDP).
"In Lithuania the general government deficit-to-GDP ratio declined from 5.5 percent in 2011 to 2.1 percent in 2013 and is projected to remain at 2.1 percent in 2014 according to the Commission's Spring 2014 Economic Forecast," the Commission said.
PUBLIC DEBT
Cannot be higher than 60 percent of GDP.
"The general government debt stood at 39.4 percent of GDP at end-2013," the Commission said.
LONG-TERM INTEREST RATES
Cannot be higher than two percentage points above the rate of the three best-performing EU countries in terms of price stability.
"Lithuania's average long-term interest rate over the year to April 2014 was 3.6 percent, well below the reference value of 6.2 percent," the Commission said.
EXCHANGE RATE
The currency of the candidate country has to be in the European Exchange Rate Mechanism for two years without severe tensions, which means that it has to trade within a corridor of +/- 15 percent from a parity rate. While it can appreciate, it should not be devalued during that time.
Lithuania had its litas currency in the ERM since 2004.
(Reporting By Jan Strupczewski; editing by John O'Donnell)