The litas is the official currency of the Republic of Lithuania. This decimal currency has a subunit of 100 centas. The current litas was introduced in 1993 after the breakup of the Soviet Union. The name of the currency is a derivative of the name of the country. After its introduction, the litas was pegged to the U.S. dollar at a rate of 4 LTL: 1 USD, but in 2002, the peg was changed to the euro at a rate of 3.4528 LTL: 1 EUR. Lithuania became a full member of the European Union in 2004, and it was expected that conversion to the euro would take place by 2010, but the projected date for conversion has been pushed back to 2014. The Bank of Lithuania is the sole issuing authority of the litas.
The Lithuanian litas was first introduced in 1922 soon after the country gained independence at the end of World War I. The original value of the litas was established as 10 litas: 1 USD. The currency was considered one of the more stable in the world, and it was backed by gold reserves held by the Bank of Lithuania outside the country. Circulation of the litas ended in 1941 when the nation was annexed by the Soviet Union. After the fall of the Soviet Union in 1991, the Soviet ruble was replaced on par by a temporary currency called the talonas.
The Bank of Lithuania was first established in 1922 to issue the litas, and it was reestablished in 1990 in preparation for independence. After independence, Lithuania planned to introduce the litas right away, but the country did not have the necessary reserves until late 1992 when a loan was granted by the International Monetary Fund (IMF). The litas was finally introduced in June 1993 at a rate of 1 litas: 100 talonas.
At the time of the country’s induction into the European Union in 2003, Lithuania had the highest growth rate of any European country. Since joining the European Union, the economy of Lithuania has grown even faster than it had before. Today, Lithuania is classified as having a high average income. As of 2011, unemployment averaged at 13.6 percent and no more than 2 percent of people lived below the poverty level. The major industries of Lithuania include manufacturing, textiles, mining and agriculture, but the economy is slowly shifting to accommodate knowledge-based industries, such as biotechnology.