Republic of Latvia: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Latvia
IMF Staff Country Reports, September 5, 2018
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- Republic of Latvia: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Latvia
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Bibliographic details
- Published: September 5, 2018
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484375242.002
Fiscal outcomes and policy stance
- Government revenues overperformed in 2017, buoyed by strong economic activity and wage growth.
- The 2017 general government structural balance recorded a deficit of 0.8 percent of GDP.
- The deficit resulted in a positive fiscal impulse, rendering fiscal policy procyclical.
Banking system resilience and AML/CFT development
- Despite the suspension of activities of Latvia’s third largest bank on money laundering concerns, the banking system remains well capitalized and liquid.
- Capital-to-risk-weighted assets of 22.4 percent (end-March 2018).
- Liquid assets exceeding 80 percent of short-term liabilities (end-March 2018).
- Subject focus includes Anti-money laundering and combating the financing of terrorism (AML/CFT) and authorities' effort.
Debt dynamics and balance-sheet repair
- Deleveraging of both households and nonfinancial corporations continued.
- Household debt to income now at half of its pre-crisis levels.
Key statistics (as reported)
- 2017 general government structural balance: deficit of 0.8 percent of GDP.
- Capital-to-risk-weighted assets: 22.4 percent.
- Liquid assets: exceeding 80 percent of short-term liabilities at end-March 2018.
- Household debt to income: now at half of its pre-crisis levels.
Republic of Latvia: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Latvia, IMF Staff Country Report No. 2018/266 (September 5, 2018).
Content in this bundle
- Country Report