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. Last Updated: 07/27/2016

Latvia's Growth Slow to Return After Crisis




RIGA, Latvia -- The Latvian statistics office said Monday it expects the economy to expand in the fourth quarter but not enough to prevent it contracting over all of 1999.


"Judging by the employment and production data available the pace of growth in the fourth quarter will not shrink [from third quarter levels] but it won't be fast enough for us to finish the year in a plus," office head Aija Zigure said at a news conference.


"We would need fourth quarter growth of 4 percent to end the year at zero growth level, which is an extremely high figure," she added.


The statistics office said earlier in the day that gross domestic product for the third quarter of 1999 remained flat year-on-year, down from 2.2 percent growth for the same period in 1998.


Nine-month GDP contracted 1.3 percent, year-on-year, compared to growth of 5.4 percent for the first nine months of 1998.


Zigure declined to give a 2000 GDP forecast, but said the Finance Ministry's 3.5 percent and Central Bank's 4 percent growth forecasts were optimistic.


The Latvian economy has struggled since Russia's ruble devaluation and economic collapse in August 1998 cut off its mainstay export market.


The economy shrank 1.9 percent year-on-year in the last quarter of 1998 and by 2 percent in the first half of 1999.


Signs of recovery have since appeared as companies reorient exports westward, with a 6 percent to 7 percent year-on-year rise in the amount of goods going to the European Union.