RIGA - If companies in all sectors were permitted to resume operations, they would no longer have to be subsidized, Latvian Chamber of Commerce and Industry President Aigars Rostovskis told LETA when asked to comment Prime Minister Krisjanis Karins' (New Unity) remarks last week about halting state support for businesses affected by the Covid-19 crisis.
Rostovskis explained that he had considered Karins' remarks in the context of the rapidly increasing external debt of Latvia. "All the money that we invest in different support measures has been borrowed from the future," he said.
By the end of the year, Latvia's external debt may increase to EUR 15 billion. "We are borrowing money from the future, and it is clear that all the people of Latvia will have to pay this debt - both the principal amount and the interest," said Rostovskis.
Furthermore, LCCI believes that the Covid-19 crisis management measures in Latvia are poorly thought out and not well targeted.
"Our position is that all businesses should be allowed to open in accordance with the [epidemiological] safety protocols. Most industries could operate and there would be no need to subsidize them, or the subsidies would be very small," said Rostovskis.
As reported, Karins said during the Cabinet of Ministers' meeting on April 20 that the government should start considering how to stop state support in Covid-9 crisis.
Karins said that this funding is 'borrowed money" from international markets.
Finance Minister Janis Reirs (New Unity) said that Latvia is approaching the set "threshold" when the government debt reaches 50 percent of the gross domestic product.
The prime minister noted that as a number of restrictions have been eased, it should be assessed where the state support should be provided.