Here's a great chart from Reuters showing just how addicted many countries in emerging Europe have become to borrowing in foreign currency for everything from second homes to TV sets :
As Reuters notes, the European Bank for Reconstruction and Development (EBRD) is concerned that despite FX loans nearly blowing out the region earlier this year, most countries and institutions have failed to learn anything from the episode. In fact FX borrowing is supposedly back on the rise in many emerging European countries as talk of recovery propels many to take a more positive view on things like euro adoption.
Latvia's central bank said Wednesday that its economy will have lost over a third of its value over the past two years due to the recession. The Bank of Latvia wrote in its macroeconomics report that compared with the fourth quarter of 2007, when Latvia's four-year boom peaked, gross domestic product would fall 37 percent. The size of Latvia's economy will return to the level of 2004 -- the year it joined the European Union -- due to the crisis, the bank said. For four years after membership, Latvia boasted the hottest economy in the EU, only to see it enter a freefall in the beginning of 2008 -- as the global financial crisis began.
The Bank of Latvia wrote in its macroeconomics report that compared with the fourth quarter of 2007, when Latvia's four-year boom peaked, gross domestic product would fall 37 percent.
The size of Latvia's economy will return to the level of 2004 -- the year it joined the European Union -- due to the crisis, the bank said.
For four years after membership, Latvia boasted the hottest economy in the EU, only to see it enter a freefall in the beginning of 2008 -- as the global financial crisis began.
Did we really trust the "hottest" economies?
In local Baltic news, kidney donation is on the rise there.
