Analytics, Economics, Latvia, Legislation

Ainars Slesers.

Slesers said in an interview on LNT television's broadcast "900 Seconds" this morning that, if the current government does not step down in January, he is ready to take the responsibility for forming a new government and, by the end of March 2010, form a Cabinet of Ministers that would be capable of action. This new government would work for the half year remaining before the next Saeima elections, and it would stay in power also further on.

As Slesers underlined, "personally for me and [the leader of Harmony Center Janis] Urbanovics it would be more advantageous to continue work at the Riga City Council until the fall."

"However, I am ready to take on forming a new government," Slesers said.

In February, official negotiations with the coalition parties represented in Saeima will be launched, in an attempt to come to an agreement regarding the government's program, writes LETA.

"Talks will not be held regarding distribution of seats: I offer forming a government that would be capable of action and would consist of seven ministers. If the president nominates me as a candidate, I will be ready to form a new government," Slesers said.

Slesers believes that the current government is at a dead end as it has promised the International Monetary Fund more than it can actually do. In Slesers' view, ministers should be competent experts. "Prime minister has to set the tone in his work, but nothing is going on at the moment, the ministers are not working," Slesers said.

The deputy mayor of Riga believes that the current government is unable to recognize its mistakes and tell it to the IMF.

Slesers underlined that Latvia's First Party/Latvia's Way had urged Saeima coalition parties not to support the next year's budget plan, because "it is anti-state and will lead Latvia into stagnation by spending cuts and tax hikes."

In Slesers view, Latvia will soon realize that raising taxes in times of an economic downturn is not a normal solution, as this means that revenues are only increased through setting higher taxes. "Imagine that someone wishes to donate 200-300 grams of blood, but instead has two or three liters of blood taken from him," he said.

"We will realize that the neighbors have managed to outplay us," Slesers said, mentioning Lithuania as example: there the income tax has been reduced to 15%. Slesers believes that soon Latvian entrepreneurs will prefer establishing and registering their companies in the frontier area, and the money they pay in taxes will go to Lithuania.

As Slesers explains, change of government is necessary because next year budget revenues will not be as high as planned and altering the budget plan will be needed.