Latvija in brief - 2011-12-08

Latvia has consolidated its budget by 2.3 billion lats (3.2 billion euros) over the past three years, Finance Minister Andris Vilks (Unity) said on Dec. 5, reports LETA. With the 2012 national budget included, the country’s budget has been consolidated by 17.8 percent of gross domestic product. The consolidation measures were carried out by reducing expenditures by 1.4 billion lats, and revenue by 900 million lats. According to the 2012 national budget bill, which was approved by the government on Dec. 5, the necessary consolidation amount for 2012 will reach 156 million lats. 90 million lats will come from expenditure cuts, whilst 66 million lats from additional revenue. However, these austerity measures are still being harmonized with the international lenders. The bill ensures that the state’s fiscal policy will be implemented and budget expenditures will be adequate to the actual socio-economic situation in Latvia and the world, emphasizes Vilks. The Cabinet of Ministers approved the 2012 national budget bill, which was to be submitted for review in Saeima on Dec. 6. The budget deficit, calculated pursuant to ESA methodology, will not exceed 2.5 percent of gross domestic product next year. Consolidated budget revenue next year is projected at 4.5 billion lats, whereas expenditures are at 4.6 billion lats.

Latvia and the international lenders are close to reaching agreement on completing the loan program for Latvia, the head of the European Commission’s mission in Latvia, Gabriele Giudice, said on Dec. 2, reports LETA. Giudice confirmed that this process was affected by the latest developments in Latvia - the Latvijas Krajbanka crisis and the takeover of national airline airBaltic. The lenders continue observing the situation and are expecting additional information from the Latvian government. Nevertheless, the sides are close to a final agreement that could be signed on Dec. 22. Giudice added that the Latvijas Krajbanka crisis will not have a significant impact on the government’s finances, since the State Treasury will be able to recover its investment by selling the bank’s assets.

The number of passengers using public transport in the third quarter of this year was 0.7 percent lower than in the same period last year, according to the Central Statistical Bureau’s data, reports Nozare.lv. 5.9 million passengers were transported by rail, which is 0.3 percent less than in the third quarter of 2010. Domestic passenger transportation fell 0.4 percent, while over international routes a 3.5 percent increase was recorded. 28.1 million passengers were carried by buses, a 5.4 percent fall from the third quarter of 2010. 20.3 million passengers used electric city transport, an increase of 6.4 percent. The number of passengers using trolley-buses increased 7.5 percent and passengers riding trams rose 5.3 percent.