RIGA, May 20 (Xinhua) -- The European Commission, which on Wednesday released its recommendations to European Union (EU) member states, urged Latvia to bolster its health sector and step up financial support to businesses affected by the coronavirus pandemic.
The pandemic has exposed problems in the Latvian health sector, the Commission said. Although Latvia has taken timely steps to contain the spread of the novel coronavirus, the pandemic showed once again the health sector needs more funding and staff.
Noting that Latvia's development finance institution Altum has launched a number of support programs for the enterprises affected, such as loans and guarantees, the Commission concluded that this support can only be accessed on strict conditions, which means that it only reaches the financially strongest companies.
Many small and medium-sized enterprises (SMEs) can therefore be left without the necessary financial support, the Commission warned.
To lessen the pandemic's negative impact on the economy, Latvia should provide greater support to SMEs and finance already prepared projects, the EU executive said.
The Commission projects the coronavirus crisis to reduce the Latvian economy by 7 percent and the Baltic country's unemployment to rise to 8.6 percent by the end of this year, while inflation is expected to be close to zero.
Its forecasts also suggest that Latvia's budget deficit will widen to 7.3 percent this year. The government support measures implemented so far this year have already exceeded 3 percent of Latvia's GDP, according to the Commission's estimates. Enditem
