Designated as Latvia’s next prime minister, Andris Kulbergs warned this Wednesday that the country could end up in a “dead end” if it continues to increase its borrowing and does not adopt firm measures to contain public spending.
“If we continue to borrow and spend without coverage, we will end up in a dead end,” Kulbergs stressed in a message published on social media, amid ongoing talks to close a Government coalition and be reelected to the post.
As he explained, if the current fiscal dynamic is maintained, the country would be forced to apply again harsh cuts and sharp increases in taxes, along lines similar to those of previous economic crises. Kulbergs has even warned that this scenario could force Latvia to hand over “the keys to the management of the State to the International Monetary Fund”.
Given this outlook, he has outlined three priority areas of action, which include “eliminating superfluous spending in the state apparatus, restoring the 2018 fiscal discipline and boosting economic growth by promoting real investment”.
At the same time, he has rejected that his program for the next executive includes cutting support for socially most vulnerable groups, stressing that this is only one of the examples cited by the State Audit when analyzing the situation of public accounts.
Kulbergs won a clear victory at the polls after committing to introduce changes and “put things in order” in the national finances. “The finances have to be put in order. Every expense will have to be reviewed. Income and expenses must add up,” he has been insisting since his electoral victory was confirmed, in elections in which the New Unity center-right force, led by the former prime minister Evika Silina, suffered a major setback by losing 19 seats in the Saeima.