Weakening euro rules was a mistake, Baltics say (Extra)

Mar 26, 2010, 10:55 GMT

Brussels - France and Germany were wrong to water down the eurozone's strict rules in 2005, the leaders of euro hopefuls Latvia and Lithuania said Friday as they insisted that Greece's budget woes would not derail their own attempts to join the currency.

France and Germany led a European Union push to water down the euro's original strict fiscal discipline in 2005 after it emerged that they had broken the rules themselves.

'The situation in the Greek financial sector and economy will not directly affect the entrance conditions for the eurozone. What is important is that the eurozone is ... capable to ask responsibility from member states,' Lithuanian President Dalia Grybauskaite said.

It was a 'mistake' to weaken the euro rules in 2005, she said.

Latvia and Lithuania both hope to join the euro in 2014, despite the havoc wrought on the currency by Greece's flaunting of the rules.

'The (euro) sanctions should be renewed, because they were there for some time but then it was changed,' Latvian premier Valdis Dombrovskis said on the margins of an EU summit in Brussels.

'It would be totally absurd if due to the problems of one country fulfilling the (euro) criteria, others were punished,' he said.