Exports power growth

  • 2008-07-16
  • From wire reports
RIGA - It is not all bad news in the Latvia economy. Companies reported good results for exports, in particular higher added-value products. The Bank of Latvia welcomed this but added that conditions for Latvia's export growth still remain challenged.
In May annual export growth slipped by 6.2 percent, although imports fell, by 11.5 percent, thus improving Latvia's foreign trade deficit Bank of Latvia spokesman Martins Gravitis announced.

 "It means that the current account deficit will keep narrowing gradually," he said, adding that the relatively fast increase in exports in May 2007 was the reason for the lower growth figure for this year.
Conditions are difficult for export development, as the decline in May, which could continue into the future, was caused by a drop in external demand and surging costs. It is therefore essential to consistently implement the measures that the government has worked out with an aim to ensure Latvia's on-going competitiveness in the world, says Gravitis.

"As has already been said on many occasions, how successfully we manage to re-direct investment from the non-tradable sectors (construction, retail and real estate) to tradable sectors, to further the development of our exports, will determine to a large extent the success of dealing with the consequences of the economic overheating and allow us to return to balanced growth," he added.

Latvian exports in the first five months of 2008 increased by 18.3 percent, year-on-years, to 1.86 billion lats (2.65 billion euros), while imports rose by 2.8 percent to 3.17 billion lats.