Latvijas Valsts prezidents Andris Bērziņš zāļu tirgū pie medus burciņām. Foto: Evija Trifanova, LETA
According to BNS on 18 July 2013, Latvia's president, Andris Bērziņš, provided this rather ominous statement:
If we do not achieve the average EU level in ten years, Latvia will cease to exist politically, said Latvian President Andris Bērziņš in an interview with Latvian commercial LNT television on Thursday.
I cannot assess the politics of this statement but I can reflect on the economics of it. By "average EU level" I presume the president refers to GDP per capita. Here Latvia stands at 61% of the average of EU28, see Figure 1.
Figure 1: GDP per capita in EU28 at Purchasing Power Standards (i.e. at comparable prices), 2012. Luxemburg excluded.
Source: Eurostat
Latvia thus needs to close a gap of 39 percentage points or, put in a different way, needs to grow 64% faster (= 100*39/61) than the Union as a whole over the next decade. This amounts to just about 5 percentage points per year; i.e. if the Union grows by 2% per year, Latvia must grow by 7% per year in order to catch up within ten years.
