A team from the International Monetary Fund (IMF), led by Mr. Christoph Rosenberg, visited Tallinn May 12-18 to review jointly with the authorities the economic situation and assess policies. The mission met with President Ilves, Prime Minister Ansip, Finance Minister Padar, Eesti Pank Governor Lipstok, other senior officials and market participants. At the end of the visit, Mr. Rosenberg issued the following statement:
“Like other countries in the region, Estonia has been severely affected by the world financial crisis. We presently project output to contract by 13 percent this year and the recovery to start in late 2010 at the earliest, depending in part on global developments. Imbalances built up in the boom years are correcting quickly, with the external current account deficit expected to largely close and inflation to move below the Maastricht reference level already this year. The drop in nominal wages after the very strong growth over the past years, while painful, will bolster Estonia’s competitiveness and is a testament to the economy’s flexibility and commitment to its currency peg.
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