Presentation by Andris Vilks, Minister of Finance, Republic of Latvia at the Bank of Latvia conference "Economic Adjustment under Sovereign Debt Crisis: Can Experience of the Baltics Be Applied to Others?" Riga, November 2, 2012.

1. Economic crisis management:
Latvian story
Andris Vilks
Minister for Finance
Riga, November 2, 2012
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2. From Crisis to Recovery
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3. The Latvian Economy has
Recovered from Crisis
GDP growth, constant prices, %
Source: Central Statistical Bureau of Latvia. Forecasts Ministry of Finance 3

4. Frontloading Budget
Consolidation 2008–2012
Budget deficit has been reduced by implementing austerity
measures in amount of 2,3 billion lats or 17% of GDP
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5. Fiscal Targets and Results
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6. Key Policy Goals & Objectives
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7. Lessons Learned
Devaluation was Frontloaded fiscal Better to cut public
neither necessary adjustment is expenditures than to
nor inevitable preferable raise taxes
Unstable coalition
International rescue
government is not Populism doesn’t
should be
necessarily an work in a serious
appropriate and
obstacle for crisis crisis
front-loaded
resolution
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8. On the Way to Euro
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9. Challenges in Future
Sustainable Economic Growth Structural Reforms
• Improve business environment • Social sector
• Strenghten competitiveness • Education
• Fiscal discipline that supports • Public administration
growth • Labor market policy
• Developments in the EU
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10. Conclusions & recommendations
for the rest of the EU
Strong and well- Responsible
Fiscal discipline
functioning EMU decision making
Respecting
commitments
Swift implementation
undertaken with the
of the 2-pack
Fiscal Treaty and
"6-pack"
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11. Economic crisis management:
Latvian story
Andris Vilks
Minister for Finance
Riga, November 2, 2012
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