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On Thursday, November 3, Prime Minister Valdis Dombrovskis will hold a meeting with representatives of the Review Mission of the International Monetary Fund (IMF) and the European Commission. The main task in negotiations with international lenders is to agree on the budget 2012 and the amount of fiscal consolidation. As already reported, Latvia plans to conclude the international loan program on December 22, 2011.
During the negotiations, the sides will discuss the macroeconomic development scenarios of Latvia for next year, assess the budget revenue forecasts and will discuss the positive impact of the measures for combating the shadow economy on budget revenues.
In view of global economic trends, Latvia’s economic growth forecast for 2012 was signed in the first sitting of the new government held on November 1 by reducing it from 4% to 2.5%. Such a conservative approach will help Latvia secure itself against the possible second wave of crisis and other economic shocks. Similarly, the government also approved the inflation forecast for 2012 in the amount of 2.4 % or by 2% less than this year as well as base expenditures of the principal budget for 2012 in the amount of LVL 3.2 billion and the social budget expenditures in the amount of LVL 1.4 billion – on this basis the consolidation of expenditures will be made.
The international lenders’ mission will stay in Latvia until Monday, November 7, when the final meeting with the Prime Minister will be held.
It has already been reported that the representatives of the International Lenders’ Technical Mission who paid a visit to Latvia in October, 2011, expressed their satisfaction over the economic indicators achieved as a result of fiscal consolidation after the budgetary amendments of 2011 as well as forecasted positive economic development.
Latvia has borrowed EUR 4.36 billion or slightly more than a half of EUR 7.5 billion, which were available to Latvia and it is planned that no other borrowings will be made. In June 2011, Latvia successfully returned to the international financial markets by issuing bonds in the amount of USD 500 million thus demonstrating its ability to independently finance its budgetary needs.
Supplementary information about the meeting with representatives of the Technical Mission of the International Lenders on October, 2011: http://www.mk.gov.lv/lv/aktuali/zinas/2011gads/09/111011-fm-15/
Information for the media:
The negotiations will be held from 10:00-12:00 in the Prime Ministers’ Hall (3rd floor of the Office of the Cabinet of Ministers). Media briefing will be held after the meeting (3rd floor of the Office of the Cabinet of Ministers).
Arrival of the media representatives at 9.45. Access to the building of the Cabinet of Ministers for the media representatives with permanent accreditation cards of the Cabinet of Ministers or by contacting the Communication Department of the State Chancellery prior to the meeting (diana.germane@mk.gov.lv, 67082922).
For supplementary information about the international loan please visit the website of the Ministry of Finance: http://www.fm.gov.lv/?lat/finansu_ministrija/jautajumi_un_atbildes/
Supplementary information:
Mārtiņš Panke
Press Secretary to the Prime Minister
Phone: 67082865 / 26556965
E-mail: martins.panke@mk.gov.lv
Information prepared by:
Diana Germane
Consultant of the Communication Department
State Chancellery
Phone: +371 67082922
E-mail: diana.germane@mk.gov.lv
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