The proposed Latvian state budget for 2021 is sustainable, yet it lacks ambition, said Latvijas Banka’ President Martins Kazaks.
“If I look at this story in general, I’m missing ambition”, evaluated the President of the Latvian central bank.
Kazaks noted that, for example, the role of Riga in the Latvian economy had not been appreciated.
“To my mind, the role of Riga in the Latvian economy is underrated”, he said and expressed the view that the government should think about Riga as the economic center of the whole Baltic region, that is, look at it from a considerably wider perspective.
The Latvijas Banka’ President also noted that the state budget should be planned, thinking about ways to invest money so that in future, a budget without a deficit could be created. This way, in the case of another crisis, it would not be problematic to support the economy. The size of the debt is already too large, Kazaks evaluated.
“None has become rich with debts alone,” the Latvijas Banka’ President added.
Reportedly, the Latvian Cabinet of Ministers has passed the proposal to allocate additional funds to increase the wages of health care staff and teachers, as well as to change taxes with the aim of increasing the social security of the population.
The decision was made on September 22. The decision by the government indicates that in the state budget of 2021, a budget deficit in the amount of EUR 1.18 billion or 3.9% of the gross domestic product is planned. It is also planned to reduce the massive deficit in the state budgets of 2022 and 2023 to EUR 876.9 million and EUR 563.8 million. (BNN/Business World Magazine)
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