Estonia will reduce its growth forecast for next year due to the euro-area’s sovereign-debt crisis, Finance Minister Juergen Ligi said.
Ligi, speaking at a news conference in Tallinn today, didn’t elaborate. The Finance Ministry is due to publish its updated forecast in the middle of September, Katrin Reimann, a ministry spokeswoman, said in a phone interview today.
The $19 billion economy, which has grown at the fastest pace in the European Union in the past two quarters, may expand 4 percent this year and next, according to the ministry’s latest forecast released in April.
“Our economy will quite clearly suffer because of Europe’s debt crisis, even though it will reach us with a delay,” Ligi said. “We are extremely interested in an end to this crisis so that the financial markets would calm down and that countries could finance their deficits and service debts under normal conditions.”
Swedbank AB, the largest Baltic lender, yesterday raised its forecast for Estonia’s GDP growth this year to 6.7 percent from 4.5 percent. The bank forecast the expansion to slow to 4.2 percent in 2012 as Europe’s debt crisis worsens and the global economy weakens, damping export orders.
Finland’s demands for collateral on loans to Greece may trigger a default on 18 billion euros ($26 billion) of bonds sold by Europe’s most-indebted country due to conditions attached to the notes that stipulate equal treatment for all investors. Finland’s announcement of a collateral deal with Greece on Aug. 16 has prompted calls for similar deals from Austria and the Netherlands, as well as Slovakia and Slovenia. German Chancellor Angela Merkel has rejected collateral demands.
“There are countries where these subjects have penetrated domestic politics very deeply, while sobriety has so far dominated here, which doesn’t mean that we’re very happy about the situation,” Ligi said. “But a bad situation needs fixing, not mocking.”
Source: www.bloomberg.com
Ligi, speaking at a news conference in Tallinn today, didn’t elaborate. The Finance Ministry is due to publish its updated forecast in the middle of September, Katrin Reimann, a ministry spokeswoman, said in a phone interview today.
The $19 billion economy, which has grown at the fastest pace in the European Union in the past two quarters, may expand 4 percent this year and next, according to the ministry’s latest forecast released in April.
“Our economy will quite clearly suffer because of Europe’s debt crisis, even though it will reach us with a delay,” Ligi said. “We are extremely interested in an end to this crisis so that the financial markets would calm down and that countries could finance their deficits and service debts under normal conditions.”
Swedbank AB, the largest Baltic lender, yesterday raised its forecast for Estonia’s GDP growth this year to 6.7 percent from 4.5 percent. The bank forecast the expansion to slow to 4.2 percent in 2012 as Europe’s debt crisis worsens and the global economy weakens, damping export orders.
Finland’s demands for collateral on loans to Greece may trigger a default on 18 billion euros ($26 billion) of bonds sold by Europe’s most-indebted country due to conditions attached to the notes that stipulate equal treatment for all investors. Finland’s announcement of a collateral deal with Greece on Aug. 16 has prompted calls for similar deals from Austria and the Netherlands, as well as Slovakia and Slovenia. German Chancellor Angela Merkel has rejected collateral demands.
“There are countries where these subjects have penetrated domestic politics very deeply, while sobriety has so far dominated here, which doesn’t mean that we’re very happy about the situation,” Ligi said. “But a bad situation needs fixing, not mocking.”
Source: www.bloomberg.com
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