RIGA, May 26 (LETA) - The current crisis that has been caused by the Covid-19 pandemic gives the Nordic and Baltic economies gives a chance to push for bolder policies and reforms that have previously been postponed due to the lack of sense of urgency or political will, Swedbank says in its latest Nordic-Baltic Business Report published on Tuesday.

The bank notes that the Covid-19 crisis has hit the global economy hard and that no country had been prepared for such a crisis. Countries that could take timely action, that have well developed health care systems and balanced economic growth and whose governments can afford to support the private sector and that have digitally skilled populations are in an advantageous position.

Swedbank believes that the Nordics and Baltics are rather well prepared to take on the challenge but notes that the crisis has also exposed issues like Latvia's weak and underfunded health sector. Latvia also lags its neighbors in terms of digital readiness.

The crisis presents an opportunity to deal with these and other issues, Swedbank said, praising Latvia's swift response and ability to carry out the necessary reforms, regroup and find new opportunities even in hard times.

Swedbank also notes that so far crisis management in the Nordic and Baltic countries has been fairly good. " Timely action has allowed them to refrain from imposing even more suffocating measures on the economies. Risks, however, remain. While the Nordics boast

well-developed and efficient health sectors, the health care system in the Baltics is weak, has been underfinanced and unreformed for many years, and can quickly become

overwhelmed if the case count surges," Swedbank said.

The bank also indicates that in some respect the Baltic states are in a better position that the Nordic countries as the Baltics have seen a balanced development in the housing market and a lowering of private sector debt. However, in Norway, Sweden, and Denmark

household debt levels remain high.

According to the Swedbank report, the crisis in speeding up economic transformation, which includes increased digitalization.

"The crisis has turbocharged the previous trend of moving towards a more digitalised way of life. This is good news for the Nordics since they are top scorers on digital readiness, while Latvia and Lithuania have some catching up to do in this regard," Swedbank says.

"Latvia's digital preparedness for the stay-at-home economy lags its regional peers. Businesses have been slower to take up digital technologies, while almost half of the population still lacks basic digital skills, undermining productivity. This makes the private sector less flexible and more vulnerable during the pandemic. The good news is that Latvia is scoring relatively well in digital public services and connectivity, making this a good stepping stone for further progress. Furthermore, the financial sector is robust, the

economy is much more balanced than in 2008, and public debt is low, allowing ample fiscal stimulus," according to the Swedbank report.

© Pakistan Press International, source Asianet-Pakistan