"The Baltic countries are the model for the internal devaluation. This also includes Lithuania. The downturn was due to a huge private credit boom, which went bust. But then the Baltic governments took needed reforms, including fiscal consolidation and some structural reforms, and this has worked. If you contrast this with Greece, you see that Greece has delayed reforms. Greece did not suffer from a private credit boom, but from a systematic fiscal overspending," he told BNS.
"So I think the Baltics are a good example for some Western economies, which are still struggling with economic problems because they are delaying the necessary adjustment," said Balcerowicz, who is in Lithuania at the invitation of the Institute of International Relations and Political Science at Vilnius University.
Some foreign analysts and politicians underline that Lithuania, Latvia, and Estonia successfully managed the financial crisis that began in 2009 and are now on a moderate growth path. Based on the latest data from the EU statistics office Eurostat, the Baltic economies, which contracted sharply during the crisis, have been among the fastest growers in the EU for the past five quarters.
Lithuania's economy expanded by 2.8 percent in the second quarter of this year compared with a year earlier. Latvia and Estonia posted GDP growth of 4.3 percent and 2.5 percent, respectively.