Leaders deliver year-end messages

RIGA - Following in the New Year’s Eve tradition, the closing of the book on 2009 was marked by speeches to the Latvian nation from both the president and prime minister. President Valdis Zatlers in his televised address to the people announced that Latvia needs responsible statesmen now, not simply a leader, reports news agency LETA.

“Today we need responsible statesmen, not leaders. We need statesmen to find the right way forward and to inspire the people,” he said. The president urged residents to vote in the 10th Saeima elections in the fall, but to vote wisely. “The state is as strong as its citizens are. Relying on a leader damages the country, sooner or later,” warned the President.

Zatlers criticized those who “say that they love Latvia but do not love the country that they live in. We are the state, and we, each of us, create our state - at our jobs, with the taxes we pay, with our social and political participation and responsibility.”
He went on to say that 2010 will be a year when the maturity of Latvian citizens and politicians will be tested, because a new prosecutor general will have to be approved, and a new Saeima elected. “The way these issues are solved, how effective the election process will be controlled, and the transparency and legitimacy of these processes will determine what country we will live in in the future,” said Zatlers.

He believes that in 2009 the people of Latvia learned “to take responsibility for themselves and their future,” and that the people have become more prudent, helpful to each other and more active. In Zatlers’ opinion, the priorities this year will include political stability, strengthening the rule of law and promoting employment. Although 2010 will be a year of hard work, Zatlers is confident that the people of Latvia are prepared for challenges.
If Zatlers directed his efforts in talking about the future, Prime Minister Valdis Dombrovskis (New Era) in his address took a few stabs at the past.

He criticized the policies of the previous governments of the past several years and urged the people of Latvia to set new goals for themselves. He called for people to “dutifully pay taxes” in 2010, saying that debate about whether people should pay taxes is “a road to nowhere.” Each time the issue of paying taxes is questioned, also questioned is the usefulness of pensions, health care, education, national security - everything that is state funded, said Dombvrovskis.
If taxes are paid dutifully, the country will be able to exit the crisis sooner and then return to the previous, lower, tax rates. However, reductions in tax rates will depend on how much tax revenue will have increased. That is a question of mutual trust between the state and businessmen, said Dombrovskis.

Referring to his government’s work in the past year, he noted that several difficult decisions had to be made, due to the economic crisis.
Last year was one of “unexpected changes and important lessons for Latvia,” said Dombrovskis. The country recorded the steepest economic downturn and the sharpest increase in unemployment in the EU. Already at the end of 2008 Latvia had to borrow money from the IMF and the European Commission. In 2009, painful decisions had to be made to reform the healthcare, education and welfare systems. Since spring, the government has been working to ensure the solvency of Latvia, and this work has been successful, Dombrovskis said.

The prime minister reminded his audience that Latvia had been warned about its overheating economy, and the risks thereof, for several years before the crisis began, both by foreign and local experts, but their advice was not heeded by the then ruling coalitions. During the years of economic growth, the government lived beyond its means and created no savings. Estonia built reserves, which is why tackling the crisis has been much easier for Estonia than for Latvia.

However, 2009 also created new opportunities, said Dombrovskis. “After the unsuccessful tiger leap, we have to start many things anew, and Latvia must become a competitive economy built on stable foundations. This is the key to the future of Latvia.”
The first and the most important resource for reviving the Latvian economy is the European Union funds that can be used to finance many infrastructure development projects, for business development and for supporting exports. A mechanism for export loan guarantees has been approved, and Latvia is one of the first EU member states to adopt an aid program for micro-enterprises, which will prompt residents to become more enterprising, Dombrovskis promised.

Another important precondition for resumption of economic growth will be attracting more investments and restoring investors’ confidence in Latvia, which depends greatly on Latvia’s reputation on international markets. Political stability, fiscal discipline and responsible economic policy will be of paramount importance in restoring investors’ trust in Latvia, said Dombrovskis.
The first signs of stabilization of the Latvian economy can already be seen. For the first time since the restoration of independence, the volume of exports exceed the volume of imports, and the 2010 state budget is one of the most important preconditions for stabilization of the financial situation in Latvia. Although highly unpopular, the budget is the financial foundation for the further economic development of Latvia. “We have to remember that we can only spend as much as we ourselves can earn,” said Dombrovskis.

Pointing to the increasingly frequent populist statements from politicians today, those who were in government during the “years of abundance,” Dombrovskis said that statements such as these had already led Latvia into a dead-end. “Despite the situation that was favorable for political populism, society in Latvia showed that it was pragmatic and would not give in to provocations,” he said.

Dombrovskis stressed that the development of social dialogue in 2009 was highly important, that through dialogue with the social and cooperation partners most measures were approved, ensuring the solvency of Latvia. This dialogue must continue next year, the premier added.

Dombrovskis praised charity fundraising campaigns, where much more money was raised than in the past years, saying this proves that society feels responsible for those who have fallen on hard times.
In concluding, Dombrovskis thanked all residents of Latvia, and stressed that 2010 would be an important year when past achievements would be evaluated and new goals would be set, also for the next Saeima and government.