VILNIUS — If Lithuania wants adopt the euro as its currency by 2014 then the government will have to continue the fiscal consolidation it undertook 2009, the International Monetary Fund said.

Lithuania made across the broad cuts and tax hikes last year in a desperate attempt to bring down its budget deficit. They were praised by the IMF and the European Commission for their swift austerity measures, which kept the country afloat without needing to take out loans from international lenders, unlike Latvia and Greece.

The budget deficit is still too [private_supervisor]high though, the IMF’s head of mission in Lithuania Catriona Purfield told Reuters at a conference in Vilnius on Wednesday.

“Lithuania needs further fiscal adjustment of 5.5 percent of GDP to the end-2012 if it wants to cut the deficit to 3 percent of GDP,” Purfield said referring to the 3 percent limit for the government deficit defined in the Maastricht criteria.

She was pessimistic enough to say that if Lithuania didn’t keep cutting expenditures, then it could go down the same road as Greece.

The budget deficit for Lithuania this year is forecast by the finance ministy at about 8.1 percent of gross domestic product, but Purfield said that this figure would need to be about 5.5 percent if they would make realistic progress towards the euro in 2014.

Recently the IMF revised its growth forecast for this year for Lithuania to a 1.6 percent decline after first quarter results were more positive than expected. [/private_supervisor] [private_subscription 1 month]high though, the IMF’s head of mission in Lithuania Catriona Purfield told Reuters at a conference in Vilnius on Wednesday.

“Lithuania needs further fiscal adjustment of 5.5 percent of GDP to the end-2012 if it wants to cut the deficit to 3 percent of GDP,” Purfield said referring to the 3 percent limit for the government deficit defined in the Maastricht criteria.

She was pessimistic enough to say that if Lithuania didn’t keep cutting expenditures, then it could go down the same road as Greece.

The budget deficit for Lithuania this year is forecast by the finance ministy at about 8.1 percent of gross domestic product, but Purfield said that this figure would need to be about 5.5 percent if they would make realistic progress towards the euro in 2014.

Recently the IMF revised its growth forecast for this year for Lithuania to a 1.6 percent decline after first quarter results were more positive than expected. [/private_subscription 1 month] [private_subscription 4 months]high though, the IMF’s head of mission in Lithuania Catriona Purfield told Reuters at a conference in Vilnius on Wednesday.

“Lithuania needs further fiscal adjustment of 5.5 percent of GDP to the end-2012 if it wants to cut the deficit to 3 percent of GDP,” Purfield said referring to the 3 percent limit for the government deficit defined in the Maastricht criteria.

She was pessimistic enough to say that if Lithuania didn’t keep cutting expenditures, then it could go down the same road as Greece.

The budget deficit for Lithuania this year is forecast by the finance ministy at about 8.1 percent of gross domestic product, but Purfield said that this figure would need to be about 5.5 percent if they would make realistic progress towards the euro in 2014.

Recently the IMF revised its growth forecast for this year for Lithuania to a 1.6 percent decline after first quarter results were more positive than expected. [/private_subscription 4 months] [private_subscription 1 year]high though, the IMF’s head of mission in Lithuania Catriona Purfield told Reuters at a conference in Vilnius on Wednesday.

“Lithuania needs further fiscal adjustment of 5.5 percent of GDP to the end-2012 if it wants to cut the deficit to 3 percent of GDP,” Purfield said referring to the 3 percent limit for the government deficit defined in the Maastricht criteria.

She was pessimistic enough to say that if Lithuania didn’t keep cutting expenditures, then it could go down the same road as Greece.

The budget deficit for Lithuania this year is forecast by the finance ministy at about 8.1 percent of gross domestic product, but Purfield said that this figure would need to be about 5.5 percent if they would make realistic progress towards the euro in 2014.

Recently the IMF revised its growth forecast for this year for Lithuania to a 1.6 percent decline after first quarter results were more positive than expected. [/private_subscription 1 year]

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