May 13, 2009, 8:09 GMT
Tallinn - Estonia joined its fellow Baltic states of Latvia and Lithuania Wednesday in recording a huge drop in quarterly gross domestic product (GDP) as economic recession deepens across the region.
Data released by the Estonian national statistics office showed the economy shrank by 15.6 per cent in the first quarter of 2009 compared to the same quarter in 2008.
'The steep decrease of ... manufacturing, construction and retail and wholesale trade influenced the decrease of GDP the most,' the statistics office said.
The figures were worse than Lithuania's GDP fall of 12.6 per cent for the first quarter but not as bad as Latvia's 18-per-cent contraction announced earlier this week.
Most analysts had been expecting a fall of 12-13 per cent. Estonian GDP has now decreased in four successive quarters.
Estonia and the other Baltic states have been hit particularly hard by the global economic downturn. A decade-long boom fuelled by readily available credit came to an abrupt end when foreign-owned banks tightened their lending criteria.
Nevertheless, coalition government led by Prime Minister Andrus Ansip insists that Estonia, a member of the European Union, will adopt the euro as its national currency in 2011.
Unlike neighbouring Latvia, Estonia has not yet asked for a loan from the International Monetary Fund (IMF), though a delegation from the IMF is currently on a visit to the country and due to announce its findings on May 18.
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