ESTONIA / GREECE / EUROZONE: Estonia Roaring Back After Austerity Cuts.

BLOOMBERG

No doubt all the Eurogroup's finance ministers, IMF and ECB officials today are wondering...why can't Greece just be like Estonia?

Estonia sucked it up in 2009 to join the Eurozone...by enacting austerity measures of 9% of its GDP.

It suffered the EU's second-deepest recession in 2008-09 behind Latvia. GDP shrank almost 20%.

But, its small $19 billion economy expanded by 8.5% in Q1...the EU’s fastest growth rate.

It has cut wages as much as 30% since 2008 to keep its exports competitive.

And it has kept its budget deficit below the EU limit of 3% of GDP... every year since joining the bloc in 2004.

PM Andrus Ansip (above) claims Estonia would have implemented austerity measures... even without joining the Eurozone.

ESTONIA: GDP Expands By 6.6% In Q4...Fastest Pace Since 2007.

BLOOMBERG /

   Latvia adopted the euro on 01 Jan. and is already seeing benefits.
   Its GDP in Q4 expanded at an annual pace 6.6%...the fastest pace in more than three years on record export growth....since Q2 of 2007.
     The $19 billion economy saw growing demand by Sweden and Finland demand for its electronics and machinery exports.
    Full-year 2010 growth was 3.1 percent.
   A Baltic analyst claims :“Estonia is a clear example of where the so-called non- Keynesian fiscal consolidation effect occurred.The positive effect from significant fiscal consolidation outweighed the negative effects on growth from the public spending cuts and tax increases.”

ESTONIA: Edward Hugh's Economic Prediction: "Delayed Recovery."

EASTERN EUROPE ECONOMY WATCH BLOG/            Another in-depth analysis from economist Edward Hugh...with charts and graphs galore.
"...the Estonian case is a complex one, since in a country with only just over a million people a myriad of special case factors can be at work, confounding results. But still, the idea is abroad that Estonia is a kind of "black swan", a data point which tends to suggest that conventional macro economic wisdom is somehow flawed. So just how valid is this view. Let's take a look at some data."

Estonia's Economy Shrank 16.6% In Quarter.

Bloomberg.

"Estonia’s recession deepened last quarter, with output shrinking the most on record, as the Baltic government cut spending to comply with euro adoption targets and demand in its Nordic export markets weakened."