Lithuania cements its move towards the West as it prepares to adopt the euro on January 1, 2015. Joel Flynn reports.
Christmas in a Lithuanian deli, and some of the excitement not just for the holidays, but for what comes after. This is the last time these shoppers are buying their cheese with Litas. From January 1 they'll use the euro - when Lithuania officially accedes to the euro zone. Vitas Vasiliauskas is the head of Lithuania's central bank. SOUNDBITE: Bank Of Lithuania Chairman of the Board, Vitas Vasiliauskas, saying (English): "By euro introduction we will be...Baltic is, will be a common, one market with one currency, so that is the issue and of course we should have in mind all geo-political issues." Much of the talk around this, the last Baltic state to join the euro, has focussed on Russia. Lithuania's accession sees the former Soviet state fully turning its back on its old ruler. Few Lithuanians oppose the shift to the West - frosty relations with Russia slowing border crossings here with the enclave of Kaliningrad to a snail's pace. Alastair McCaig is from IG. SOUNDBITE: IG Market Analyst, Alastair McCaig, saying (English): "There is certainly a long-standing history of insecurity being felt by many of these Baltic nations very much lying in the middle between Russia and the West, and I think any further allegiance they can have with the western business environment would further strengthen their sense of security." This is a country held up by Europe as a poster child for austerity. Huge cuts in public spending and an economic crisis saw GDP fall 15 percent in 2009 - large numbers of Lithuanians leaving since then. But now it looks healthier than many other EU economies - growth seen at 2.7 percent in 2014. The central bank says the euro could add five percent to GDP in the next seven years. Problems still though for one of Europe's poorest economies. Education, healthcare and a brain drain just some of the drawbacks businessmen like Visvaldas Matijosaitis are warning about. SOUNDBITE: Viciunai Group CEO, Visvaldas Matijosaitis, saying (Lithuanian): "We're facing a labour shortage because we only started our business 20 years ago, after Lithuanian independence, and productivity is not what it is in the West. Wages have room to grow, but productivity must rise as well. That needs a lot of investment." Lithuania may have won plaudits for its fiscal prudence and for its market reforms, but the euro still brings concerns. Over half of voters don't support it. Accession to the euro zone also coming at the same time as talk of Greece leaving - deflation too a worry. Despite the concerns though, for many in this country of three million, 2015 might just see further prosperity on the horizon.