047_TTGB CITIES GUIDE 4/11/08 16:13 Page 47
cities guide 47
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cities guide: Baltic region L50776L50776 airline reviews L50776L50776 hotel reviews L50776L50776 diary
P
olitical reform and market liberalisation
have transformed the nations around the
Baltic Sea. Estonia, Latvia and Lithuania
benefited enormously from joining the
European Union in 2004, while Finland, Russia and
Sweden prospered in a strong global economy.
Modern hotels and conference centres sprang up
to meet the demand from business travellers.
The credit crunch, however, has dampened its
potential. Lithuania’s economy grew 7% in 2007
but is expected to shrink this year. Growth in Latvia
dropped from 10% in the first quarter of 2007 to
0.2% in the same period this year. It is already in
recession, and there is a good chance its neigh-
bours could soon join it.
Rampant inflation, although now decreasing,
has delayed the entry of the three Baltic states
into the Euro from next year until at least 2011.
And Russia’s stock market, which grew by almost
70% in 2006, has been suspended several times
since early September because of its extreme
volatility. The best the Baltic region can hope for
this year is modest growth; the reality could be
very much worse.
On the plus side, Nordic banks are less exposed
to toxic loans than those in the UK or the US.
And the Baltic states are enjoying a surge in
workforce as migrants
come home from
western Europe. Some
analysts believe the
region’s economy is
cooling down after
several years of strong
growth, and might not
enter a recession.
Whatever happens,
the years of prosperity
have equipped the
countries that surround
the Baltic Sea with all
Fact: More
the facilities visiting
than 500,000
Baltic business
business travellers could
immigrants to
want. The major cities
the UK from
will be ideally placed
to help businesses
the east have
maximise trade already returned
between east and
J
AAN
Economies in the countries around the Baltic Sea have boomed in
home because
the past few years. While the global downturn is having an effect,
west when there is
the economy is
a recovery in the
they may escape the worst of the crisis. Tim McAtackney reports global economy.
better there
L50480
GE: ALLAN ALA
IMA
ttgbusiness.com a79 november 2008
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