In the past I spoke of how Latvia,which had previously been a leader in economic growth, was in a bit of slump. In a followup to the situation, I was unfortunately not surprised when I learned that their situation has become worse. According to the BBC, the powers that be that determine the credit ratings of nations have determined that Latvia is now below investment standard. The country’s already had a rough go. They’ve taken out a large bailout and been forced to nationalise banks, and the picture doesn’t look like it is getting better anytime soon. Taken into consideration with the regional situation – such as Russia recentlycutting off oil to Ukraine – a grim picture is painted of Eastern Europe.
Tough times could encourage entrenchment into domestic affairs which would counter hopes for democratization and liberalization in Eastern Europe. The last ten years have done wonders for European integration. Under a structural framework, the European Union has succesfully encouraged a cooperative Europe which has included the former Communist nations. I’m not an economist but I feel that Eastern Europe, which was economically lagging Western Europe and trying to catch up, would be the worst hit by economic issues – and that could be like taking three step backwards down the path the European Union has gone. I feel that Latvia could be an indicating nations on what approach other Eastern European nations will do in dealing with these economic troubles – economic troubles which are a result of this integrated system.
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