NATO pilots are not only the ones who have been losing their sleep over the issue of the growing number of military personnel in the Russian subcontinent. The exporters of the three Baltic States based out of north-eastern Europe namely, Latvia, Estonia and Lithuania are also suffering the same situation, not because of the growing personnel in Russia but due to the recent crisis that has recently occurred in the subcontinent.
The above mentioned countries were the newest members of the Euro North East area but due to the recent crisis the countries have seen a downfall in their respective sales in Russia which is also expected to reduce by one fifth of its current ratio.
The statistics show that the Russia accounts or contributes to the 21 per cent of the Lithuania’s export, 12 per cent of Latvia and 9% of Estonia’s. One of the largest banks of Denmark, Danske Bank published a report stating that the current values of the goods and services are likely to shrink and the value will drop between 18 and 25 per cent. In terms of money this is likely to cost their economy Euro 690 million collectively or in case of U.S. dollars this amount is approximately $780 million.
Recent surveys by news agencies suggest that growth forecast of the Baltic economy will fall by 1.8 % as compared to the previous year. Considering the respective GDP numbers from the IMF estimates the potential expansion of $1.58 billion has been erased since the Russian-Ukraine crisis kicked off.
It can also be seen in the survey reports that the GDP in the year 2015 of Lithuania is expected to have fallen to about 4% in the month of February continuing on which It is likely to reach up to the level of 3.74 per cent in the month of May dropping down to 3.2 in the month of August and reaching to the level of 2.5 in the month of Feb 15.
Now taking the consideration of Latvia from the GDP statistics provided it can be seen that in the month of May 2014 the rates have dropped to a low of 3.7 % from the previous 4.5 % followed by a further depreciation to 3.2% which again is expected to drop to2.5 per cent till Feb 2015.
Lastly, considering the case of Estonia the country started with 3.5 % in Feb 2014 which decreased to 3.0 in May 2014 and ended to a level of 2% in the year of Feb 2015.
The economists were very positive in the growth of the Latvia and Lithuania but now the tables have turned and the speed of growth has gradually slowed down. Estonia which was believed to grow more than 2.5% instead dropped down by 1.8 per cent. Latvia was expected to see a growth of 3% but instead it went down by 2%. Finally, Lithuania which was expected to grow up to 2.8 % instead showed a growth of 3.2 %
Now moving on to the positive aspects of the scenario, stats show that the Baltic States are one of the countries with the lowest debt burden in the Euro area. The debt load of Estonia is almost 11 per cent less than that of Finland and the country is still expected to grow with respect to its currency union colleagues leaving Slovakia and Ireland.
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Danske Bank gave the credit of this result to the confident consumers in the Baltic States who rose their spending at a faster rate than that of its overall growth. In fact the crisis would have not fallen upon the nation of Russia if the same steps had been followed by them.