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Latvia econmin ups 2010 GDP forecast to -3 pct
Tue, 2nd Mar 2010 09:53
RIGA, March 2 (Reuters) - Latvia's gross domestic product (GDP) will fall 3 percent this year, the Economics Ministry forecast on Tuesday, a slightly more optimistic forecast than the 4 percent drop expected by the Finance Ministry.
The country's 7.5 billion euro bailout deal with the International Monetary Fund and European Union, agreed in late 2008, also sees a 4 percent contraction this year.
'The recovery of Latvia's economy in the coming years will largely depend on how fast the global financial system and the main foreign trade partner countries will recover,' the Economics Ministry said in a report.
It said that Latvia's path of avoiding a devaluation via an internal correction of prices and wages was working and saw future growth coming from exports rather than internal demand.
It saw GDP falling in the first half of 2010, with growth resuming in the third quarter and 2011 growth of 2 to 2.5 percent, versus the loan programme's forecast of
2 percent.
Consumer prices this year were seen falling 3.5 percent, versus an earlier forecast of 3.7 percent.
'Social problems related to the low employment level will be prevailing over the next 3-4 years. In the medium-term, the labour demand will not exceed the level of 2008,' the ministry said.
The ministry saw jobless this year at 16 percent, falling to 14 percent in 2011. (Reporting by Aija Braslina; editing by Patrick Graham) Keywords: LATVIA ECONOMY/
(Riga newsroom, patrick.lannin@reuters.com, patrick.lannin.reuters.com@reuters.net, +371 29 269 191)
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Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The country's 7.5 billion euro bailout deal with the International Monetary Fund and European Union, agreed in late 2008, also sees a 4 percent contraction this year.
'The recovery of Latvia's economy in the coming years will largely depend on how fast the global financial system and the main foreign trade partner countries will recover,' the Economics Ministry said in a report.
It said that Latvia's path of avoiding a devaluation via an internal correction of prices and wages was working and saw future growth coming from exports rather than internal demand.
It saw GDP falling in the first half of 2010, with growth resuming in the third quarter and 2011 growth of 2 to 2.5 percent, versus the loan programme's forecast of
Consumer prices this year were seen falling 3.5 percent, versus an earlier forecast of 3.7 percent.
'Social problems related to the low employment level will be prevailing over the next 3-4 years. In the medium-term, the labour demand will not exceed the level of 2008,' the ministry said.
The ministry saw jobless this year at 16 percent, falling to 14 percent in 2011. (Reporting by Aija Braslina; editing by Patrick Graham) Keywords: LATVIA ECONOMY/
(Riga newsroom, patrick.lannin@reuters.com, patrick.lannin.reuters.com@reuters.net, +371 29 269 191)
COPYRIGHT
Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
