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Tuesday 21.01.2020 | Name days: Agne, Agnese, Agnija
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EC predicts Latvia to have the slowest economic growth among Baltics

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Baltic States, European Commission, economic growth, GDP, Valdis DombrovskisThe latest economic outlook from the European Commission estimates that Latvia’s GDP will likely grow 2.5% this year, which means the slowest economic growth among Baltic States.

EC’s outlook published on Thursday also shows that Latvia’s economic growth rate will reach 2.6% in 2020 and 2.7% in 2021.

Inflation in Latvia is expected to be 3.1% this year, 2.5% in 2021 and 2.3% in 2022, EC estimates.

Among Baltic States, the most rapid economic growth is expected for Lithuania, where, according to EC’s estimates, GDP will grow 3.8% this year. Next year and 2021 Lithuania’s economic growth will increase to 2.4%. Inflation in Lithuania is expected to be around 2.4% this year, 2.2% in 2020 and 2.1% in 2021, the commission predicts.

For Estonia, the European Commission expects a 3.1% GDP increase this year, 2.1% and 2.4% in the next two years. Inflation in Estonia is expected to be 2.4%, and it is expected to drop to 2.1% next year and increase to 2.2% in 2021.

EC’s autumn economist outlook estimates that this year and the next European Union’s economic growth will reach 1.4%. Eurozone’s economic growth will be 1.1% this year and 1.2% in the next two years.

Inflation in the EU this year and the next is expected around 1.4%, whereas inflation of 2021 is expected around 1.6%. In Eurozone, according to European Commission’s estimates will be 1.2% this year and the next, whereas inflation of 2021 is expected around 1.3%.

The most rapid economic growth among the bloc’s member states is expected for Ireland (5.6% this year and 3.5% next year), Malta (5% this year and 4.2% next year), and Hungary (4.6% this year and 2.8% next year).

The slowest GDP growth is expected for Italy (0.1% this year and 0.4% next year) and Germany (0.4% this year and 1% next year), European Commission estimates.

Commenting on the latest outlooks, EC Vice President for the Euro and Social Dialogue Valdis Dombrovskis says ‘so far Europe’s economy has proven its resilience against negative external factors: economic growth continues, new jobs are created, and strong domestic demand remains’.

«Nevertheless, it is possible there could be some complications in the future associated with trade conflicts, growing geopolitical tension, shortage of growth in the production sector, and there is also Brexit. I invite all EU member states with a high state debt level to implement a cautious fiscal policy and commence debt level reduction. The member states with fiscal space to spare should use it now,» adds Dombrovskis.


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