BRUSSELS, July 8 (Xinhua) -- European Union (EU) finance ministers on Tuesday gave their final approval for Slovakia to join the eurozone as of Jan. 1 next year.

    According to the decision taken by EU finance ministers at their regular monthly meeting here, the Slovak koruna would be converted into the euro at the rate of 30.1260 korunas to the euro.

    Slovakia's Finance Minister Jan Pociatek hailed the EU approval as a "historical success", saying that his country would reap huge economic benefits from adopting the euro.

    "Since we are a very small and open economy, this brings greater stability and allows more investors to come," he said.

    "It is a historical success for the people while the conversion rate does not threaten the commercial sector."

    However, EU's Economic and Monetary Affairs Commissioner Joaquin Almunia sounded a note of caution, pointing out that Slovakia still faces the tough challenge of maintaining sound public finances, "particularly in the fiscal and structural domain."

    The country is expected to promote wage-setting in line with productivity growth, pursue further structural reforms and continue to monitor financial sector and credit dynamics, he said.

    "Slovakia is well placed to benefit from euro-area participation. Still, this is not the end of the road," Almunia added.

    Like previous eurozone entrants, Slovakia would also have to remain vigilant in the months leading up to next January to ensure a smooth changeover.

    The European Commission proposed in May to accept Slovakia into the single currency club from the beginning of 2009. EU leaders endorsed the proposal at their June summit following European Parliament approval.

    Slovakia, with an economic growth rate of 8.8 percent last year, will be the 16th member of the eurozone following Malta and Cyprus, which adopted the euro in January this year.

    The country could be the last of the EU newcomers to join the eurozone by this decade since other eastern European countries remain short of meeting all the convergence criteria for adopting the currency.

    According to a recent EU Commission report, Slovakia has seen "a credible and sustainable reduction" of its annual budget deficit from 8.2 percent of GDP in 2002 to 2.2 percent last year, well under the EU limit of 3 percent of GDP.

    Eurozone inflation is currently at a record high of 4 percent, largely due to soaring oil and food prices.