EBRD Head: Eastern Europe to Avoid Debt Default

Business » FINANCE | March 11, 2009, Wednesday // 17:27
Bulgaria EBRD Head: Eastern Europe to Avoid Debt Default: EBRD Head: Eastern Europe to Avoid Debt Default "What we are now facing in some countries in eastern Europe is a severe recession but not a collapse," Thomas Mirow, president of the European Bank for Reconstruction and Development, said in a speech at the London School of Economics. Photo by EBRD

Eastern European economies will avoid debt defaults and "bounce back strongly" after the global financial crisis, said Thomas Mirow, president of the European Bank for Reconstruction and Development, as cited by Bloomberg agency.

"What we are now facing in some countries in eastern Europe is a severe recession but not a collapse," Mirow said in a speech at the London School of Economics. "It would however be a grave mistake to paint the future in colors too bleak. The situation today is serious, but it is manageable."

The economies of former communist countries have been shaken by the drying up of credit and investment after years of unprecedented growth as the region integrated with the wealthier West. Some, including Hungary, Latvia, and Ukraine were forced to take international bailouts to stabilize their finances.

Ukraine faces an economic contraction of as much as 10 percent in 2009 after nine years of growth. The Hungarian economy may slump 3.5 percent this year and record its worst performance in 16 years.

"There are strong underlying fundamentals in eastern Europe which remain in place and need to be protected," said Mirow. "We believe that eastern Europe will come out of the present crisis, perhaps bruised and battered, but not beaten."

 

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Tags: EBRD, Global Financial Crisis, Eastern Europe

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