Latvia committed to stabilizing economy, premier says

Latvia committed to stabilizing economy, premier saysStockholm - Latvia remains committed to stabilizing its currency and bringing down its budget deficit, visiting Latvian Prime Minister Valdis Dombrovskis said Monday after talks with his Swedish counterpart Fredrik Reinfeldt in Stockholm.

"Latvia's economic stabilization programme is based on the stabilization of the lats and meeting Maastricht criteria by 2011," Dombrovskis said.

"During 2011, it means bringing down the budget deficit to 3 per cent of GDP (gross domestic product) in 2011 so that we can join (the) eurozone later," he added.

Dombrovskis said Latvia was still "negotiating with international loan providers" to increase its budget deficit this year from 5 to 7 per cent, citing that due to the "much worse economic outlook this year... we are asking for a somewhat bigger budget deficit this year" compared to when the loan packages were agreed.

The budget deficit goals of 5 per cent in 2010 and 3 per cent in 2011 remained, as previously outlined, he said.

Latvia has negotiated aid packages from the International Monetary Fund (IMF), the European Commission as well as Sweden.

During their meeting, the two premiers discussed Sweden's incoming presidency of the European Union and the economic downturn that has impacted Latvia among other countries as well as future enlargement of the EU, Reinfeldt said. (dpa)