Although Estonia’s economy shrank 18 percent in 2008-2009, the Baltic state pulled itself out of the doldrums and managed to grow by 7.6 percent last year — five times the euro-zone average. The country joined the currency bloc 18 months ago. The country has a national debt of ‘just’ 6 percent of GDP, which compares to Germany’s 81 percent and Greece’s 165 percent of GDP.Do you suppose that we will hear about this success anywhere else?
How did Estonia get to these numbers? Following the 2008 economic contraction, the Estonian government cut its budget by 6.1 billion Estonian kroon (around $500 million) and its expenditure by 3.2 billion Estonian kroon (around $260 million). By 2010 Estonia’s GDP grew by 3.1 percent, according to the country’s finance ministry.
Monday, October 8, 2012
Proof: Cutting Spending is Good
Thanks to Captain Capitalism, we can see that Estonia has cut its government spending, and it has improved as a result.