RTTNews - The executive board of the International Monetary Fund or IMF on Thursday approved a loan amount equivalent to US$278.5 million or EUR195.2 million for immediate disbursement to Latvia. This brings the total disbursements to the country under the Stand-By Arrangement to US$1.14 billion or EUR780.7 million.

The IMF said the economy is suffering from a much deeper contraction than seen at the launch of the program in 2008. According to the latest GDP figures, the Latvian economy contracted 19.6% on a yearly basis in the second quarter, steeper than a 18% fall in the first quarter.

Nevertheless, the lender said it remained committed to an adjustment strategy that centered on strong fiscal consolidation.

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