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Feb 22, 2009

Latvia follows Iceland. Who’s next?

The Global Financial Crisis* led directly to the collapse of Icelan

The Global Financial Crisis* led directly to the collapse of Iceland’s government last month. Now Lativa is following suit, with their Prime Minister handing in his resignation. As with Iceland, it looks like this will lead a new Coalition government being negoitated, rather than an immediate election. Just a few years ago, Latvia’s economic growth – along with its neighbouring countries – led to it being labelled as one of the ‘Baltic Tigers’. 

This is reminscent of Ireland, which until recently was widely lauded as the ‘Celtic Tiger’, but is now in very very deep financial strife. Along with all the financial difficulties being felt virtually everywere, the very weak state of their banks, helped along by what looks rather like corrupt behaviours by some bank officials, makes the Irish situation leak very bleak indeed.

It’s hard not to think there will be a few more governments topple over the course of this year. But the real issue is not how various governments will fare, but how the public at large – especially those who are already amongst the poor or struggling – will fare as the year unfolds.

* (it seems more like a global economic and social crisis to me, rather than a global financial one- and GFC always makes me think of Global Fried Chicken – but who am I to buck the labelling trend)

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2 thoughts on “Latvia follows Iceland. Who’s next?

  1. Andrew Bartlett

    […] little over a week ago I pondered which country would be next to follow Iceland and Latvia on the list of national governments which have fallen as a result of […]

  2. andrew

    Its unfortunate but most of the Eastern European countries are failing. Hungary is under an IMF loan, Lithuania is in the same boat as Latvia with Estonia not too far behind. Romania and Bulgaria are not far behind at all, with Eastern European workers being sent back to the home land from the likes of Italy, Spain, France, Germany and the UK, the pressure this will place on higher unemployment will cripple these eastern countries.

    One more troubling problem is the immanent collapse of Pakistan. They have already received around USD$5Bill from the IMF in December and have just asked for more.
    The collapse of Pakistan, so close the the tactically important Afghanistan could cause a major hiccup for a western nations foothold in Central Asia so close to Russia.