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Freedom ‘bigger’ than economic hardship, says Straujuma

Prime Minister Laimdota Straujuma warned the public Friday on LTV's morning news program Rīta Panorāma that some sectors of the national economy would suffer more from Russia’s countervailing food imports embargo than others. 

However, she added that the total impact on Latvia’s exports would be negligible, saying “altogether the sum isn’t great, it can be overcome.”

The premier declined to talk yet about specific forms of support for enterprises affected by the embargo, as gatherings of ministerial experts and sector NGO leaders are scheduled for Friday and Monday.

In her view, a 10% decline in GDP is the worst hit Latvia might face in the event Russia were to completely close down all trade, including energy and transit. However Straujuma played down the possibility of such an extreme scenario.

“The EU states cannot stand by and watch as a nation close to us in the center of Europe – Ukraine – is conquered in the middle of the 21st century. That is unacceptable. Freedom is more important than economic difficulties, which we will overcome,” the prime minister said.

Straujuma further urged the people of Latvia to support their own national enterprise sector and buy food grown, produced and processed in Latvia.

“Buy Latvia’s milk products and fish products, that’s how you’ll help Latvia’s companies that export,” urged the government leader, saying the survival of some firms may be in the hands of Latvian consumers.

Chamber of Trade and Industry chief Jānis Endziņš told Rīta Panorāma he supported Straujuma’s call.

“Someone buying goods not made in Latvia possibly is letting a worker go from his job right here,” he suggested, saying that the cheaper price of imported products was less of an argument to an economically patriotic consumer. He told viewers some individual firms would inevitably face bankruptcy due to their overly one-sided reliance on the Russian export market unless solutions are sought, such as tax deferments or compensation funds.

However, economist Raita Karnīte expressed the view that direct figures tell only part of the story of the impact of the food products embargo. She told Rīta Panorāma the government’s official reaction is “overly calm.”

“One shouldn’t fool people and tell them everything’s alright. One needs to mobilize society, like Russia is doing. If it’s not so bad after all, it won’t hurt, such mobilization will not hurt,” said Karnīte.

“One shouldn’t underestimate the gravity of the situation,” she added.

“If we haven’t managed to access other foreign markets after 24 years of trying, there’s little reason to think it’ll happen now overnight,” she commented certain sectors’ reliance on exports to unreliable Russia. “It’s sad that we have to give up that market, which is essentially so well suited to Latvia,” she said.

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