Latvia
| FORECAST* | ||||||
|---|---|---|---|---|---|---|
| Main Economic Indicators | 2022 | 2023 | 2024 | 2025 | 2026 | 2027 |
| Population, 1000 persons | 1879 | 1877 | . | . | . | . |
| GDP, real change in % | 1.8 | 1.7 | -0.2 | 2.1 | 2.4 | 2.6 |
| GDP per capita (EUR at PPP) | 24960 | 26860 | . | . | . | . |
| Gross industrial production, real change in % | 0.9 | -5.6 | . | . | . | . |
| Unemployment rate - LFS, in %, average | 6.9 | 6.5 | 7.0 | 6.8 | 6.5 | 6.1 |
| Average gross monthly wages, EUR | 1373 | 1537 | . | . | . | . |
| Consumer prices, % p.a. | 17.2 | 9.1 | 1.3 | 2.0 | 2.5 | 2.7 |
| Fiscal balance in % of GDP | -4.9 | -2.4 | -3.0 | -2.9 | -2.5 | -2.2 |
| Public debt in % of GDP | 44.4 | 45.0 | . | . | . | . |
| Current account in % of GDP | -5.5 | -3.9 | -3.3 | -3.6 | -3.2 | -3.5 |
| FDI inflow, EUR m | 1174 | 1557 | . | . | . | . |
| Gross external debt in % of GDP | 109.4 | 102.7 | . | . | . | . |
Basic data are continuously updated.
* Forecasts are changed beginning of January, April, July and November.
See Press Conferences.
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Monthly Report No. 1/2025
Vasily Astrov, Alexandra Bykova, Selena Duraković, Meryem Gökten, Richard Grieveson, Maciej J. Grodzicki, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanović, Niko Korpar, Dzmitry Kruk, Sebastian Leitner, Isilda Mara, Emilia Penkova-Pearson, Olga Pindyuk, Sandor Richter, Marko Sošić, Bernd Christoph Ströhm and Maryna Tverdostup
wiiw Monthly Report No. 1, January 2025
50 pages including 6 Tables and 13 Figures
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Executive summary
Olga Pindyuk
in: The Crisis is Over, but its Scarring Effects are Hindering Recovery
wiiw Forecast Report No. Spring 2024, April 2024 , pp. I-VII
Details
Shrinking external demand and (particularly) a fall in investment resulted in GDP continuing to decline in Q3 2024. Over the whole of 2024, the economy is estimated to have shrunk by 0.2%. For 2025, the ongoing upswing in business and consumer sentiment indicates a recovery; this will, however, be slower than previously thought. A major growth driver will be planned investment, financed from the NextGenerationEU programme. Meanwhile, exports will revive only gradually, as EU (and particularly German) industrial developments remain subdued, while rising prices have resulted in Latvian producers losing some competitiveness on the world markets. Consumer price inflation will increase only slightly, to 2% on average this year; however, a gradual rise is to be expected in the coming years. Real incomes are projected to increase quite strongly this year, too (albeit at a slower pace than before, particularly in the public sector). Thus, we will see household demand revive much more briskly in 2025 than last year. Given the economic stagnation, the public deficit probably reached 3% of GDP in 2024, but it is expected to decline in the coming years. The unemployment rate increased only slightly in 2024, to 7%, and is likely to fall again in the coming years, given the rather tight labour market. In the medium to long term, GDP growth is projected to revive to 2.1% in 2025, 2.4% in 2026 and 2.6% in 2027.