Europe’s economy has entered a phase of recovery. Nevertheless, the economy lacks dynamic development. In addition, considering the incredibly stimulating monetary policy and enormous available liquidity volumes on financial markets, Europe’s investment volume has yet to return to its pre-crisis level, said European Commission Vice-President Valdis Dombrovskis at the forum organized by Vidzeme University College on Friday, 13 May.
At the beginning of his speech, Dombrovskis said Latvian has demonstrated its right to be considered as a medium income level country. According to classification rules of the World Bank, Latvia can be considered a high-income country. Latvia has also been a member of the European Union and NATO for more than a decade. «Yesterday, we received news that Latvia’s joining of the Organization for Economic Cooperation and Development – a prestigious club of developed countries – has been supported,» – said Dombrovskis.
He said that Latvia’s accomplishments in the 25 year period since the restoration of independence is sometimes overlooked. «In order to understand the true value of our country’s accomplishments, we only have to look at the current situation in countries of the former USSR – Moldova, Ukraine, Central Asian Republics and Russia,» – said Dombrovskis, adding that challenges of the future significantly exceed Latvia’s current accomplishments.
The EC Vice-President also noted that EU has played a major role in Latvia’s development since the restoration of independence. Joining the EU was major stimulus for structural reforms and overall improvements of management in Latvia. Access to the single EU market and EU funds plays a major role for the development of Latvia’s economy. Europe will continue playing a major role in Latvia’s development.
He also admits that the European economy is currently in a state of recovery. Nevertheless, economic development lacks the dynamic. In spite of a stimulating monetary policy and enormous available liquidity volumes on financial markets, the volume of investments in Europe has not returned to its pre-crisis level. The fact that money does not flow in actual economy points to structural problems and obstacles that only delay investments, said the politician.
«Considering this experience, there are certain economic policies in place in the EU to help with growth and creation of new jobs – improvement of investments, structural reforms and responsible fiscal policy. These strategic directions are tied to one another and complement each other. Often reforms serve as conditions for investments. The situation with state finances is a clear signal to international investors in relation to investment safety in certain countries,» – said Dombrovskis.