Latvia Risks Downgrade on Budget Pressure, Fitch Says - by Ott Ummelas<
Latvia risks a rating downgrade as the Baltic state has yet to push through “painful” adjustments needed to reduce its budget deficit and comply with the terms of an international bailout, Fitch Ratings said. “Failure to implement budget cuts and remain on track with the European Union, International Monetary Fund program could lead to a downgrade,” Fitch said in a note published today. Latvia’s government is struggling to meeting the terms of a 7.5 billion euro ($11 billion) EU, IMF bailout, which call for tough austerity measures to achieve budget cuts. Prime Minister Valdis Dombrovskis said yesterday his administration is working hard to avert a repeat of June’s crisis, when delays in passing budget agreements linked to the bailout brought the economy to the brink of bankruptcy.
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