Latvia’s government will likely have to borrow funding in order to afford support activities for residents to overcome the energy crisis, said Prime Minister Krišjānis Kariņš in his interview to LTV programme Rīta panorāma on Wednesday, 14 September.
The politician stressed that the government has already approved a wide package of support measures. However, this may not be enough, and some form of price cap may be set. Above this cap residents’ payments for energy resources will not increase. Instead additional costs will be covered from the state budget.
According to the PM, the government is waiting for estimates from the Ministry of Economics in order to implement caps appropriately.
According to Kariņš, if funding for support measures is taken from budget surplus, funding for more expansive support will have to be borrowed.
The PM explains the favourable budget situation with strong exports. Finance Ministry, meanwhile, admits budget revenue benefits from the rapidly growing inflation.
Kariņš mentioned that the country’s debt has dropped to 43% of GDP. This offers some room for the government to borrow money.
Although support measures will be expanded, it will not be possible to liquidate all consequences of the Russian war with a single government decision, said Kariņš.
When asked to explain if Latvia has enough gas to last the winter, Kariņš said yes, there is enough gas.
According to him, the total volume of gas Latvia needs to make it through the winter season is estimated at 6.9 TWh. He said the volume of gas currently stored at Inčukalns gas storage facility exceeds 7 TWh. Kariņš also said Latvia continued procuring gas.
The issue is the gas price, not gas availability, claimed Kariņš.
As for Latvijas gāze, which claims there isn’t enough gas to satisfy the needs of residents because part of the gas stores were sold to other users, the PM said Latvijas gāze has a duty to primarily provide gas to residents.
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