Latvia’s CB head: GDP growth in 2014 likely to be same as 2013.

By bne IntelliNews August 2, 2013

Head of the Bank of Latvia Ilmars Rimsevics told BNS that he believes that the GDP growth in 2014 will be largely similar to the growth rate in 2014. He believes that the growth cycle that started in 2011 is continuing, which is confirmed by the EC seeing Latvia’s economy as EU’s fastest growing for three years to come.

FinMin also believes that 2013 and 2014 will see the same GDP growth pace. This week FinMin revised the GDP growth forecast for 2013 and 2014 from previous 4% to 4.2%. Medium-term economic growth expectation remains unchanged at 4%. Inflation forecast for 2013 was lowered from 1.5% to 0.4%. FinMin believes that domestic consumption is going to determine most of economic growth this year, while in the medium term Eurozone recovery, the economy will become more balanced between exports, consumption, and investment.

At the same time in 2014 record-low inflation of 2013 will be pressured upwards by the liberalisation of the electricity market, higher excise duties on tobacco, as well as growing income increasing core inflation, FinMin believes.

Situation in the Eurozone and the development around the troubled domestic metallurgy major Liepajas Metalurgs are seen as the main risks to stable economic development.

Latvia’s EconMin expected GDP growth in 2013 and 2014 at 4.5%. The 2014 growth might be lower should the external environment not improve. External demand has affected the slowing exports in 2013, while improved domestic demand contributed to maintaining economic growth.

Previously this month the Bank of Latvia announced the revised macroeconomic forecasts. GDP growth in 2013 is expected at 4.1% vs. previous forecast of 3.6%. Inflation is seen averaging to 0.7% y/y this year vs. previous forecast of 1% (already cut once from initial 2% expectation).

According to the latest spring outlook by EC, Latvia’s GDP growth is seen by the European Commission at 3.8% y/y in 2013 and 4.1% y/y in 2014. IMF expects 4% of GDP growth in 2013 in Latvia.

The World Bank in its latest Global Economic Prospects sees Latvia’s GDP growth at 3.6% in 2013, 4.1% in 2014, and 3.7% in 2015. This made an improvement from previous January’s forecast of 3% for 2013. The WB estimates 2012 GDP growth at 5.6%.

Related Articles

Latvia issues permits to new gas infrastructure holding

The Latvian Public Utilities Commission (SPRK) announced on January 5 that it has issued licences to Conexus Baltic Grid for the transmission and storage of gas. Conexus Baltic Grid will control ... more

Latvijas Gaze agrees to set up spin-off company to operate gas grid and storage

A shareholders' meeting at Latvijas Gaze (LG) decided on December 22 to set up a company that will be used to spin off the country's gas pipelines and storage facilities. The creation of Conexus ... more

Latvia fines Swedbank for failings in anti money laundering measures

The Latvian branch of the Swedish banking group Swedbank said on November 23 it will implement measures to curb money laundering. The pledge follows an audit and a fine of €1.36mn from the ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss