On Lithuania’s accession to the European Union (EU)
the Bank of Lithuania became a member of the European System of Central Banks (ESCB),
which comprises the European
Central Bank (ECB) and the national central banks of all EU Member States.
It participates in the work of the General Council of the ECB and the committees
of the ESCB in developing and adopting the decisions of the ESCB.
The General Council of the ECB, which comprises the President
and Vice-President of the ECB and the governors of all the national central
banks of the ESCB, bears the main responsibility for the reports on the progress
of the convergence of the EU Members States that have not adopted the euro. The
General Council also advises on the necessary arrangements for establishing the
irrevocable exchange rates of the currencies of these Member States. It
regularly discusses the decisions of the Governing Council of the ECB related to
monetary policy but does not participate in the decision-making process of the
Eurosystem, which consists of the ECB and the national central banks of the euro
area countries. Normally meetings of the General Council are held four times a
year.
The ESCB committees address various issues of the ESCB and
are accountable to the Governing Council via the Executive Board. The Governing
Council and the Executive Board have the right to request the ESCB committees to
address particular issues within their field of competence, thereby facilitating
the decision-making process. The committees act as the advisory bodies to the
Governing Council.
The Bank of Lithuania is a holder of the subscribed capital of the ECB.
Following the increase of the ECB capital from 1 May 2004 to EUR 5,565 million,
the Bank of Lithuania’s share in the subscribed capital of the ECB is 0,442.5
per cent (i.e. EUR 24,623,661). The national central banks outside the euro area
pay up 7 per cent of their subscribed capital of the ECB.
The national central banks of the EU countries may be the sole subscribers to
and holders of the capital of the ECB. The capital of the ECB, which consists of
the shares of the national central banks, is established according to the share
of a respective Member State in the population and the gross domestic product of
the European Union. The shares assigned to the national central banks must be
adjusted every five years as the share of both the population and the GDP may
change over this period.
The Bank of Lithuania participates in the processes of Lithuania’s
integration into the European Union. The functions of the Bank of
Lithuania are directly related with the acquis of the three chapters of
the EU law: Economic and Monetary Union,
Free Movement of Capital, and
Freedom to Provide Services. The Bank of
Lithuania within its competence implements the obligations of the Republic of
Lithuania assumed in the negotiated positions of these chapters of the EU law,
is involved in the activities related with the transposition of the EU law, the
requirements, standards and practices of the ECB in specific fields of the
business of a central bank, and with enhancing its institutional capacities.
Equally important for the Bank of Lithuania are the decisions adopted by EU
institutions pertaining to the economic policies pursued by the EU. The Bank is
involved in developing
Lithuania’s Convergence Programme,
National Report on Structural Reforms and revised
General Economic Policy Guidelines of the EU covering the priorities for
macroeconomic policies.
