“You see, numbers are one thing, what people feel and how they see is another thing, because here, after all, there is a similarity with the average temperature in a hospital ward,” said publicist Andrejs Pantelejevs in an interview on TV24’s “Ziņu top” program, talking about the economic situation In Latvia, commenting on one Professor Innas of the University of Latvia (LU). Šteinbukas’ public message that “it is a myth that Latvia is a poor country”.
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Panteleyev emphasized that maybe its average temperature in a hospital ward is “relatively good” – 37 degrees, but in reality it means that for part of the population it is 35. “Close to death…And for some it is very high. That’s why I think that statistically, on average, we have grown, but at the same time, the problems of poverty and insufficient quality of life still exist in Latvia. And I think that it is very important to talk about them and not hide behind average numbers, but also to talk about these issues of quality of life and poverty,” urged Pantelejevs in TV24’s “Ziņu top” program.
It has already been reported that Inna Šteinbuka, professor of the University of Latvia (LU), director of the “LV Peak” think tank, while presenting the study “Latvia in the European Union – 20 years” expressed the message that it is a myth that Latvia is a poor country, LETA reported on April 30 .
In Šteinbuka’s view, Latvia’s development over the past twenty years can be divided into stages. She called the first one a “phase of euphoria”, when after joining the European Union (EU) growth rates were high, up to 10% per year. According to Šteinbukas, it seemed that Latvia would immediately succeed in reaching the level of prosperity that it has, for example, in Germany, but it turned out that such a development was unhealthy.
According to her, Latvia’s level of backwardness compared to neighboring countries can be traced directly to the 2008 crisis. At that time, it was necessary to find a solution to save the situation. Steinbuka said that she well remembers the words of the then Prime Minister Valdas Dombrovskis (JV), namely that this will be a “government of suicides”. “The ‘suicide government’ has actually done the impossible. It doesn’t happen often when the case of Latvia is described in textbooks, in which way belt-tightening or a drastic reduction of budget expenditures allowed the country to enter the eurozone after a few years,” said the professor at the University of Warsaw.
She pointed out that, according to the conducted survey, Latvian residents consider joining the eurozone and the introduction of the euro as the fifth main achievement of being in the EU. Steinbuka emphasized that Latvia was more competent when faced with future crises, such as the Covid-19 pandemic or the energy crisis.
“Latvia had macroeconomic stability, fiscal discipline and most importantly – the euro, which increased the trust of potential lenders in the Latvian state and we were able to borrow cheaply, which was not possible at all in 2008. This is one of the important achievements and benefits of the introduction of the euro, which may not be as obvious as, for example, traveling abroad and not changing currency,” said the LU professor.
ES Šteinbuka called the next stage of Latvia’s development a stage of moderate growth. According to her, at that time all of Europe could not recover from the experienced global crisis. Investors were also cautious and for several years there was a gap between the necessary investments and the real investments in all EU member states, but in Latvia this gap was larger, thus the growth was more moderate.
She explained that no growth could be promoted during the pandemic, but when the pandemic was over, the war in Ukraine and the energy crisis began. The LU professor emphasized that Latvia’s development went like waves, but the growth trend was upward.
“We say we are lagging behind our neighbors. Yes, we are behind, but we are not a poor country. This is another myth, along with the fact that Latvia has destroyed its industry. The share of industry, if we look at value added, we have 30%. Yes, there are more in Lithuania, but we cannot say that we have destroyed industry in Latvia,” said Šteinbuka.
She emphasized that the people of Latvia highly value not only the introduction of the euro, but also the security promoted by both NATO and the EU. The second benefit appreciated by society is the opportunity to travel freely, the third achievement is the availability of European funds. The LU professor pointed out that there have been good and not so good projects to learn EU funding, but if there were no European funds, the growth of the gross domestic product would be 8% lower on average per year.
She emphasized that it is necessary to encourage private investments, to try to find funds in the state budget, and to look at private banks that can provide credit for development. The LU professor admitted that there are many obstacles. Both the EC and the OECD have been providing Latvia with various advice for many years. Steinbuk pointed out that they do not always need to be implemented urgently, but they mark the direction.
“The situation is difficult because geopolitical tensions make our efforts uncertain. We live in uncertainty. The economy is stagnating in EU member states, more in one country, less in another. Latvia also has problems with human capital, education and so on. But there are things that do not require large investments from the state budget, such as combating bureaucracy. We could deal with it if we had the political will,” said the professor of the University of Warsaw at the end of her speech.
You can watch the full video of the TV24 program “Žiņu top” here:
Themes
Tags: Pantelejevs problems poverty insufficient quality life Latvia
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