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Latvia tops 2012 EU growth with 5.6% 10.03.2013

Keen to join the eurozone next year, Baltic state Latvia said Monday that revised data confirmed its economy grew by 5.6 percent in 2012, the strongest level in the 27-member European Union for the second year running.

In the last three months of 2012, Latvian gross domestic product (GDP) was 5.1 percent higher than in the same period of 2011, and was unchanged from initial estimates released in February.

Latvia posted 5.5 percent growth in 2011 - the best figure for the entire EU.

Strong results through the year by the farming and IT sectors along with a revival in the building sector helped contribute to the upbeat figures, Statistics Latvia said.

On a quarterly basis, the economy expanded by 1.4 percent in the final quarter of 2012 compared with the previous three-month period.

Latvia wants to adopt the euro next year and while growth is not one of the EU Maastricht Treaty's criteria regarding the single currency, Latvia's strong performance reinforces government claims that its economy has stabilised after years of choppy macroeconomic data.

With its national currency, the lat, already fixed against the euro, Riga says it is unfazed by the eurozone debt crisis and believes the currency switch could further boost exports and improve market efficiency.

The Latvian parliament approved a euro changeover plan on January 31, and on March 5 the country applied to the European Commission for an assessment of its readiness to begin using the euro from January 1, 2014.

The European Commission is expected to give its verdict in June with a final decision on whether Latvia will be allowed to adopt the euro expected in July.

If Latvia wins the Commission's approval as expected, the former Soviet republic will become the eurozone's 18th member.

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