Morten Hansen: Tough times ahead but the country looks fiscally well-prepared
"The Latvian government is reacting swiftly with targeted measures towards health care, businesses in the worst affected parts of the economy (for instance travel but the list gets longer by the day), social assistance etc.," admits Morten Hansen, Head of Economics Department at SSE Riga.
"Ever more draconian measures are taken to contain the virus and the economic fallout is increasing by the day, if not by the hour. The breakdown of supply chains is a negative supply shock to the economy while the lack of access to travel, restaurants, movie theaters etc etc is a massive negative demand shock. Both shocks reduce GDP and increase unemployment and very rapidly so."
Morten Hansen regularly adds to the economic-political debate in Latvia through his columns at the independent Latvian magazine IR.