Foto: Reinis Hofmanis, F64
Latvia tops the EU GDP growth league is the kind of headlines we hear today. With its 6.9 percent growth rate in the first quarter of 2012, for a second quarter in row Latvia has made it to the top position of the best EU growth performers.
But it was not so long ago, in 2008 and 2009, when different headlines were prevalent. At that time, nobody cared about the European South or their debt, everything was fine over there, the real global problem was Latvia. Then many renowned economists "of name" had to do something none of them probably ever thought they would be doing during their career: find an interest in a remote country like Latvia. Those were really the country's fifteen minutes of fame.
Let us try to reconstruct what was the mood back at the end of 2008 and the beginning of 2009 - an intense period which is rapidly fading into recent history - when Latvia went through a sudden stop accompanied by incessant speculators attacks and a war-like experience of 24 percent GDP drop.
