MOSCOW, September 25 (RIA Novosti) - The Euro area has been steadily recovering from the crisis since the second quarter of 2013, however the recovery process has stalled recently, European Central Bank (ECB) President Mario Draghi said during an interview with Lithuanian business daily Versio Zinios.
"The recovery seems to have lost momentum recently: the flat GDP reading in the second quarter of 2014 was disappointing. According to the preliminary information received over the summer, economic conditions have been somewhat weaker than expected," Zinios was quoted as saying.
Zinios stated that the high unemployment levels in the euro zone and continued weak credit growth are likely to further slowdown the recovery.
However, Zinios said that he still expects modest growth in the second half of the year due to ECB's support, including an accommodative monetary policy stance, favorable financing conditions and structural reforms.
When asked about the reasons for Lithuania's concerns over being part of the euro zone, Zinios said that joining the euro might be initially associated with some difficulties and obligations, but they will be compensated for later.
"Joining a stronger euro area will increase the long-term prosperity of its members and their resilience to adverse shocks. But there are also other concrete benefits stemming from trade and foreign direct investment, which will be bolstered, especially given Lithuania's strong trade ties with its two Baltic neighbors in the euro area, Estonia and Latvia," Zinios was quoted as saying.
The euro will be introduced in Lithuania on January 1, 2015. Almost half of Lithuanians oppose the changes, according to a new poll by Eurobarometer. Many argue that adopting the euro will result in a loss of economic control and national identity.
Zinios also said that being part of the euro zone safeguards economies against various geopolitical tensions referring to the recent import ban introduced by Russia in response to Western sanctions over the Ukrainian crisis.
"For instance, the European Commission announced support measures to protect food producers affected by Russia's food embargo. The euro area is a large market that can help Lithuanian producers to make up for losses from the Russian market," Zinios explained.
