The Latvian Parliament approved the 2012 state budget, trimming the deficit below the European Union’s limit as the Baltic nation prepares to adopt the euro in 2014.
The legislature voted 56-42 today in Riga to pass the budget with a shortfall of 2.5 percent of economic output, below the EU’s 3 percent ceiling, and down from an expected 4.5 percent this year. The plan, economic growth of 2.5 percent, is the final budget in the country’s 7.5 billion-euro ($9.7 billion) lending program from a group led by the European Commission and the International Monetary Fund.
Latvia turned to the lenders in late 2008 after its second- biggest bank needed a state rescue and a real-estate bubble burst. The government has adopted spending cuts and tax increases of 2.3 billion lati ($4.3 billion), or 17.8 percent of GDP, since seeking aid.
For more: Latvian Parliament Backs 2012 Budget With Narrower Deficit - Bloomberg
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