.


IMF approves bail-out for Latvia


There have been protests in Riga against tax rises


The International Monetary Fund (IMF) has approved a 1.68bn euro ($2.35bn; £1.59bn) rescue loan for Latvia.

It is part of a 7.5bn euro package that includes funding from the European Union, World Bank and other countries.

It will allow Latvia to maintain its currency's peg to the euro, but there will be sacrifices such as cuts in public sector wages and state spending.

Value added tax will be raised from 18% to 21%, which has prompted protests in the capital, Riga.
Latvia has also agreed to keep its budget deficit below 5% of gross domestic product next year and reduce it to 3% by 2011. The other countries involved in the bail-out are the Czech Republic, Poland, Estonia and the Nordic countries.


From:

BBC NEWS | Business | IMF approves bail-out for Latvia