Analytics, Economics, EU – Baltic States

Only Ireland and Estonia could see their GDP's contract more than Latvia – by 1.8% and 1.5%, respectively. IMF declined to evaluate Zimbabwe GDP growth this year. Overall, GDP is predicted to decrease in five countries this year, the other two being Brunei (by 0.5%) and Italy (0.1%).

IMF believes that Qatar will register the biggest GDP growth this year of 16.8%, whereas GDP in Angola and Azerbaijan will increase 16% each.

IMF believes that Latvia's GDP will shrink another 2.2% next year. In 2010 Latvia's GDP could increase 1.1%, IMF said.

IMF also believes that inflation will remain high in Latvia. According to IMF estimates, annual inflation in Latvia could reach 15.3% this year, 10.6% in 2009 and 6.7% in 2007.

On the other hand, the current account deficit in Latvia's balance of payments could decrease to 15.1% of GDP this year and 8.3% in 2009, the report says.

Estonia's GDP will decrease 1.5% this year but increase 0.5% in 2009, whereas GDP of Lithuania could increase by 3.9% this year and 0.7% in 2009, IMF said.

Inflation in Estonia is projected at 10.2% this year and 5.1% in 2009, and in Lithuania at 11.3% and 6.2%, respectively.

The report also says that the current account deficit in Estonia could decrease to 10.8% of GDP this year and 8.7% next year, whereas in Lithuania increase to 14.9% this year and then decrease to 8.7% in 2009.

The IMF report says that world growth will slow amid most dangerous financial shock since 1930s. There will be no growth in many advanced economies until at least mid-2009, and global economy expected to stage modest recovery later in 2009.

On an annual basis, global growth is expected to moderate from 5% in 2007 to 3.9% in 2008 and 3% in 2009.