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Exports are up, so the trade deficit should decrease, right? In fact, it is increasing as the imports are growing quickly! Latvia's unnaturally strong currency isn't helping local companies as importing is cheaper for Latvians than exporting. This doesn't help job creation at all. Although I hardly ever speak bad about Latvia, I really think this "recovery" is good...look at the high unemployment and 300k+ that hve left the country. Things are doomed, total reform is needed in Latvia - starting with the Lats.
Toggle Commented Jun 9, 2012 on What I learned in Latvia at Dani Rodrik's weblog
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Jun 9, 2012