Latvian GDP contracts by 29%

Two weeks ago the IMF forecasted a drop in GDP for the Baltic nations of over 10%. But the Wall Street Journal reported yesterday that Latvia’s GDP contracted a massive 29% in January-March 2009, compared with the same 3 months in 2008. Annual contraction for this year is now predicted to be at least 20%, far more than contractions in past crises like 12% for Argentina and 13% for Indonesia. The social consequences of those earlier crises were dramatic in those two countries. In Latvia, the Prime Minister said his government plans to continue slashing spending and public sector wages.

Source: Wall Street Journal, 12 May 2009