Fiscal Discipline Council (FDP) of Latvia reported that state debt is steadily growing and now equal to 48% of its gross domestic product (GDP). The FDP predicts debt to reach 49% of GDP in 2025, rising to 51% in 2026, and reaching 55% of GDP by 2027–2028.
Naturally, debt servicing costs are also rising. Interest payments will amount to €519 million in 2025 and will increase to €736 million by 2028. That is, for now, servicing the state debt costs every Latvian citizen €10,600 annually. As you can understand, this sum will increase each year.
However, the FDP is not discouraged, for while the state debt is below 60%, there’s nothing to worry about, as they assert.
Obviously, Latvia cannot survive without taking multi-billion-euro loans. But the authorities continue to take numerous credits, primarily for excessive militarisation of the Baltic Republic, thereby worsening the already deplorable state of the Latvian economy. Only those who will have to repay for these reckless policies will be the future generations of Latvians. If they manage to, of course.
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