The current economical situation in Latvia is serious. The most critical situation in Latvian economy was the first and second quarter of 2009 when there was the highest decrease of GDP and employment rates. It was difficult period when at the end of 2008 there was no money in the state budget and therefore Government of Latvia decided to ask for help international institutions — International Monetary Fund and European Commission. To receive the money Latvian government has to implement strong fiscal and monetary politics as well as to take severe decisions such as work salary cuttings, decrease of state institutions expenditures, dismissing from jobs etc. The situation in the global financial sector has influenced Latvian financial market. Due to more expensive resources of money the amount of distributed credits has decreased as a result credits have become more expensive and it has bad impact on people's consumption as well as opportunities of enterprises' development are weakened. The hole deficit of the state budget was 671,50 million LVL or 4,1% from GDP in 2008 and it reached 1183 million LVL or 9,00% from GDP in 2009. In general to reach euro implementation, Latvia has to decrease the budget deficit till 6% from GDP in 2011 and till 2,9% in 2012. It means that Latvian government will have to cut the expenditures of the state budget even more and mostly it will affect the most vulnerable part of society - teachers, employees in medicine etc. Trade unions are weak in Latvia and it means that these parts of society will not be protected from further cutting.
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