Latvia Needs to Modify IMF Loan Conditions

Latvia is preparing to modify its draft budget for 2009, preparing for a budget deficit of 7% of Gross Domestic Product (GDP). This comes despite a prior agreement with the IMF and other international institutions to access financial aid of 7.5 billion euro, which requires that the deficit will not exceed 5%, informs AFP quoted by Mediafax.

”We are preparing a budget deficit of 7%. IMF will take a decision after we submit budget amendments” said the Latvian Minister of Finance, Einars Repse.

Latvia in December 2008 concluded an agreement with the IMF and other international institutions for a credit loan of 7.5 billion euro conditioned on keeping the budget deficit below 5% of GDP in 2009.