bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Friday 24.03.2017 | Name days: Kazimirs, Izidors

Dombrovskis: Latvia’s economic growth is better than expected

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUEurope’s economy begins the fourth year of recovery and continues to grow moderately, which is mostly dues to consumption. The majority of the world’s economies, meanwhile, are experiencing major challenges. This serves to increase growth risks in Europe, as noted in the European Commission’s winter outlook.

Vice-President for the Euro and Social Dialogue Valdis Dombrovskis said: «Europe is continuing its recovery, with growth broadly in line with our previous forecast in autumn. We have to remain attentive. Europe’s moderate growth is facing increasing headwinds, from slower growth in emerging markets such as China, to weak global trade and geopolitical tensions in Europe’s neighbourhood. It is important to continue structural reforms that can help our economies grow, withstand shocks in the future, and improve job opportunities for our population.»

In regards to Latvia’s economic growth, Dombrovskis said: «Latvia’s economy demonstrates stable growth, which is better that what the EC had predicted in autumn last year. Instead of the previously predicted 2.4%, Latvia’s economy grew 2.7% in 2015. This year’s economic growth is expected to be 3.1%. Faster growth rates are related to the fact that Latvia’s economy successfully uses global conjuncture – low energy prices and low interest rates on international finance markets. Banks have begun providing loan services more actively to companies and households, which is important for the stimulation of the national economy. Internal demand and investments are the main economic growth engines. Latvia’s economic growth rate is significantly above that of the average in Eurozone and European Union (1.7% and 1.9% respectively). Latvia continues demonstrating the highest growth rates among Baltic States. For the first time since the end of the last crisis, unemployment in Latvia dropped to a single digit value – 9.9%. It is expected this positive situation will remain in 2016 as well, when unemployment is expected to drop to 9.2%. Latvia should continue using the beneficial state of its economy to realize structural reforms, which are an important factor for attracting investments and enhancing the country’s competitiveness.»

Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici said: «The European economy is successfully weathering new challenges this winter, supported by cheap oil, the euro rate and low interest rates. Nonetheless, the weaker global environment poses a risk and means we must be doubly vigilant. There is more work to do to strengthen investment, enhance our competitiveness in a smart way and complete the job of fixing our public finances.»

Economic results of all member states were either positive or stable in 2015. It is expected that economies of all member states will have expanded by 2017. GDP growth rates will remain varied, which can be explained with structural changes and certain cyclic positions.

It is expected that private consumption will remain the main driving force behind economic growth this year and the next. Investment should also gradually benefit from increasing demand, improved profit margins, favourable financing conditions and gradually lower pressure to deleverage.

Employment should continue to rise modestly. Unemployment rates are set to continue falling, albeit at a slower pace than last year. The decline should be more pronounced in Member States where labour market reforms have been implemented. The unemployment rate in the euro area is expected to fall from 11% in 2015 to 10.5% in 2016 and 10.2% in 2017. In the EU unemployment should fall from 9.5% in 2015 to 9.0% this year and 8.7% next.

Eurozone’s total government budget deficit index will continue to decline, largely thanks to increased economic activity and lower interest expenditure.

In the euro area, the general government deficit is expected to have fallen to 2.2% of GDP in 2015 (EU 2.5%) and should fall further to 1.9% of GDP this year (EU 2.2%) and 1.6% of GDP in 2017 (EU 1.8%). The fiscal stance of the euro area is expected to become slightly more supportive to the economic recovery this year. In the EU, it is set to remain broadly neutral. The debt-to-GDP ratio of the euro area is forecast to decline from its peak of 94.5% in 2014 (EU 88.6%) to 91.3% in 2017 (EU 85.7%).

Annual inflation in the euro area was only slightly above zero towards the end of 2015, mainly due to a further drop in oil prices. Consumer price increases in the euro area are expected to remain very low in the first half of the year and should start picking up in the second half when the impact from the sharp fall in oil prices abates. For 2016 as a whole, euro area annual inflation is now forecast at only 0.5%, partly because wage growth remains subdued. Inflation is expected to pick up gradually and to reach 1.5% in 2017 as higher wages, higher domestic demand and a moderate pick-up in oil prices increase price pressures.

Given the deterioration of the global economic outlook, the recovery of the global economy (excluding the EU) is now forecast to be slower than expected in the autumn. In fact global growth in 2015 is set to have been at its weakest since 2009. Euro area export growth should accelerate over the course of 2016 following a moderation in the second half of 2015. This is due to lagging effects from the euro’s past depreciation, lower unit labour costs, and a gradual increase in foreign demand.

Ref: 102.109.109.9722


Leave a reply

CC: restoration of trust – way out for cartel participants

This year, Competition Council provided positive conclusion in regards to recovery of trust to two companies previously punished for cartel agreement.

Kristovskis: coalition with Lembergs in Ventspils City Council is not possible

«If the party’s list enters the city council, our candidates will definitely not work with Lembergs,» said Girts Valdis Kristovskis in an interview to Latvijas Radio.

Sadales tīkls: energy industry enjoys stable growth in Baltics

Although the company does not experience the lack of quality labour force, when announcing vacancies it becomes clear that population density in regions continues to decline, and this makes it harder to find young specialists for work in regions, said Andis Pinkulis, CEO of Sadales tīkls, in an interview to BNN.

Airline Nordica not to ban tablets and lap-tops from being brought on passenger cabin

Estonia’s national airline Nordica has stated it would not follow the recent U.S. and British ban on such computer devices as tablets and lap-tops from being brought onto passenger cabin on flights.

Rinkevics invites Canadian companies to use Latvia’s transit and logistics infrastructure

«We’re hoping for more intensive economic cooperation and diversification of exports of Latvian goods, as well as attraction of investments from Canada. Canadian investors are awaited in Latvia,» says Latvian Foreign Affairs Minister Edgars Rinkevics.

Rimsevics: tax changes may increase lending volumes in Latvia

Lending volumes in Latvia may increase because of changes to the country’s tax system, says governor of the Bank of Latvia Ilmars Rimsevics.

Latvian authorities deport 19 Vietnamese citizens

19 Vietnamese citizens caught trying to cross the border of the Republic of Latvia last year have been deported from the country.

Latvia’s export and import volume was the lowest in January

Latvia’s export and import volume this January was below what was noted in Lithuania and Estonia. The largest foreign trade balance deficit among Baltic States was noted in Estonia.

Lithuanian population continues to shrink, some glint may be ahead

The shrinkage of Lithuanian population is nowhere close to a halt. In fact, the recent numbers by the Lithuanian Statistics and Eurostat, the European Union‘s statistics agency, purport the opposite: exodus has picked up last year - 50,000 Lithuanian citizens left the country for a better life abroad, up from 44,500 in the previous year.

Over 200 people could have died in Mediterranean

It is assumed that over 200 migrants might have drowned this week in the Mediterranean, off the coast of Libya, a Spanish humanitarian aid organisation feared.

Proportion of HIV-infected tuberculosis patients in Latvia is 17.4% - the highest in EU

The proportion of HIV-infected tuberculosis patients in Latvia is 17.4%, which is the highest not only among Baltic States, but also Europe, as mentioned by Jurijs Perescikovs, director of Disease Prevention and Control Centre’s Infection Risk Analysis Department in a discussion dedicated to the World Tuberculosis Day.

British police names London terrorist

British police has stated that the March 22 terror attack in London was committed by British-born Khalid Masood. Another of his victims has died.

Air temperature in Latvia to remain largely unchanged in coming days

On Friday, 24 March, high atmospheric pressure will remain in the country. Because of that, some clouds will be seen in the sky, wind speed will stay moderate, and air temperature will rise to +3° C…+8° C, as reported by the State Environmental, Geology and Meteorology Centre.

Kucinskis hopes to find a new director for State Chancellery within two weeks

Latvian Prime Minister Maris Kucinskis hopes to find a new manager for the State Chancellery within the next two weeks.

InnoEnergy business opens an office in Latvia

International business accelerator company InnoEnergy has opened an office in Latvia. This objective of this company is preparing new and innovative technologies developers for attraction of investments as part of InnoEnergy accelerator.

Bank of Latvia increases inflation outlook for 2017 to 2.7%

The Bank of Latvia has increased its inflation outlook for 2017 from 1.6% to 2.7%, as reported by the bank’s press-service.

CC permits Lithuanian company to acquire decisive influence over Latvian businesses

Latvia’s Competition Council has permitted two mutually associated deals to be performed by W.P.Carey and Kesko, allowing the two concerns to acquire decisive influence over Lithuanian Baltic Retail Properties and three companies registered in Latvia – K Prof, Polo LS and Daugavkrasts M.

Estonian military transport firm co-operates with leading Norwegian and British companies

Estonian military transport manufacturer Milrem has made a joint product with Norwegian weapon-maker Kongsberg and British remote system producer Qinetiq North America.

Welfare Ministry opposes diverting part of social budget to healthcare

Experts view Finance Ministry’s proposal to divert certain parts of the social budget to pay for certain healthcare services. Welfare Ministry is especially cautious about this proposal.

Saeima agrees to publish names of disciplinary punished judges

Publication of information about disciplinary penalties applied to judges, their names and surnames will no longer be prohibited, as stated by amendments to the Judicial Disciplinary Liability Law supported by the Saeima in the first reading on Thursday, 23 March.

Experts: internet users open up 30% of fraudulent e-mail letters

Cyber criminals are becoming more and more cunning and their fraudulent e-mails – harder and harder to differentiate from real ones. Internet users open up to 30% of fraudulent e-mail letters, explains eScan antivirus developers.

Minister: Latvia supports International Coalition’s fight against Daesh

«The fight of the International Coalition against Daesh has become a very effective instrument to help reduce Daesh military, financial and recruitment capabilities,» said Latvian Foreign Affairs Minister Edgars Rinkevics.

New pulp factory planned in Estonia

Estonian entrepreneurs have envisaged building a high-tech pulp-making plant near the city of Tartu and have submitted the plan for confirmation from Estonian national special planning authorities.

Ventspils Freeport Authority announces procurement

Procurement has been announced for the construction of an access road in Ventspils, Talsu Street 200 and landscaping of nearby territories so that one of the land tenants can commence construction of their building there, as reported by Ventspils Freeport.

Estonian investors consider construction of pulp factory in Latvia

Investors that consider building a pulp factory worth EUR 1 billion in Estonia’s southern region allow for the possibility of getting permission for the same project in Latvia, because this process can take a long time in Estonia.