He explained that consumer prices will decline as numerous companies will be unable to sell their products and will be forced to sell for lower prices.
Kaza also predicted that the purchasing power of the population will decline twofold because of the Russian crisis many companies will have to reduce their number of employees to avoid insolvency.
He believes a decrease in the number of jobs will entail lower tax revenues for the state and thus Latvia will unlikely be able to implement a balanced budget in 1999.
Ilya Gerchikhov, the president of the cosmetics company Dzintars, voiced his opinion that at this point there are many people in the government and the Parliament working to solve their personal problems and not the state's. He stressed the state should help companies to overcome the impact of the Russian crisis.
"Unless today a committee is formed to solve the economic problems effectively, in two years' time Latvia will become a bog," said Gerchikhov.
He said it is important not only to conquer new markets but to retain positions on the existing markets so that in due time work there could be restarted in a position of advantage.
Baltijas Holding owns large blocks of shares in companies like Ogre Knitwear, the electric-device factory Rigas Auto Ektroaparatu Rupnica and the shipyard Rigas Kugu Buvetava.