Äike
08-12-2010, 05:46 PM
Ligi: This Is the Growth We Sought (http://news.err.ee/Economy/07fdc1fe-7c3a-4820-b0c9-4db03f95d941)
Minister of Finance Jürgen Ligi dismissed as ridiculous the claims that the growth in GDP hasn't trickled down to the whole population, and declared that the 3.5 percent growth was exactly what the ministry had expected.
"The only way for the benefits to reach the most affected - that is, the unemployed - is that we have growth," Ligi argued at the cabinet press conference today in response to professor Rainer Kattel of the Tallinn University of Technology, who said yesterday that the growth has yet had no effect on very many people.
Minister Ligi also addressed the negative comments on low domestic demand. "In a nutshell, this is the economic growth that we sought. Let's keep our point of reference in mind - we are comparing internal demand with the heyday of the boom when borrowed money was circulated on the domestic market - when we had, figuratively speaking, our hair cut and our shoes mended on credit, and did business in general on credit."
This kind of growth was not sustainable in the long run, Ligi said. "For a considerable length of time, domestic demand was unreasonably high, consumers lived beyond their means, the state lived beyond its means, enterprises also lived beyond their means."
Reorientation to export was what the Ministry of Finance had called for, Ligi argued. "We wanted growth and we wanted it mainly through export, not internal demand." Domestic demand would follow export, he assured.
Minister of Finance Jürgen Ligi dismissed as ridiculous the claims that the growth in GDP hasn't trickled down to the whole population, and declared that the 3.5 percent growth was exactly what the ministry had expected.
"The only way for the benefits to reach the most affected - that is, the unemployed - is that we have growth," Ligi argued at the cabinet press conference today in response to professor Rainer Kattel of the Tallinn University of Technology, who said yesterday that the growth has yet had no effect on very many people.
Minister Ligi also addressed the negative comments on low domestic demand. "In a nutshell, this is the economic growth that we sought. Let's keep our point of reference in mind - we are comparing internal demand with the heyday of the boom when borrowed money was circulated on the domestic market - when we had, figuratively speaking, our hair cut and our shoes mended on credit, and did business in general on credit."
This kind of growth was not sustainable in the long run, Ligi said. "For a considerable length of time, domestic demand was unreasonably high, consumers lived beyond their means, the state lived beyond its means, enterprises also lived beyond their means."
Reorientation to export was what the Ministry of Finance had called for, Ligi argued. "We wanted growth and we wanted it mainly through export, not internal demand." Domestic demand would follow export, he assured.