Analytics, Financial Services, Investments, Latvia, Rating

Standard&Poor’s notes that Latvia's rating will be likely increased within the next 24 months if the country's economic growth remains strong, steady and balanced, and if the growth is faster than in other countries with similar income levels, Latvia also should reduce external and government debts.

The positive outlook reflects Latvia's growth potential, improved fiscal situation and eurozone membership, which in the future will reduce external risks and offer banks access to the European Central Bank's liquidity instruments, comments Finance Minister Andris Vilks (Unity).

Standard&Poor’s also said it expected Latvia's gross domestic product to be growing 4% to 5% annually during the next three years. The agency notes that Latvia has improved its fiscal positions greatly over the past several years, reducing budget deficit from almost 10% in 2009 to 1.5% in 2013. If such fiscal policy is pursued in the future, the government's debt will be decreasing faster than anticipated, and the country's credit rating could be increased.