Special Report: Global Financial Crisis

    BRUSSELS, Feb. 25 (Xinhua) -- The European Commission transferred on Wednesday the 1 billion euros as the first installment in the medium-term financial assistance to Latvia of up to 3.1 billion euros agreed by financial ministers in January.

    The assistance is part of an internationally co-ordinated package of up to 7.5 billion euros, provided on strict conditions of Latvia's pursuit of an ambitious program of economic and budgetary adjustment.

    "EU support to Latvia underlines our solidarity to our Member States," said Joaquin Almunia, Commissioner for Economic and Financial Affairs.

    "At the same time, everyone should be clear that this support is subject to Latvia's implementing its program of economic and budgetary adjustment adopted in December, and if necessary taking additional adjustment measures," he added.

    Almunia said that the European Commission, the executive body of the European Union, has expected the new Latvian government to commit fully to the program.

    The support is being provided in conjunction with the International Monetary Fund (1.7 billion euros), the Nordic countries (Sweden, Denmark, Finland, Estonia and Norway) (1.9 billion together) and the World Bank (0.4 billion euros).

    The European Bank for Reconstruction and Development, the Czech Republic and Poland will also provide a total of 0.4 billion euros bringing the total to up to 7.5 billion euros over the period to the first quarter of 2011.

    Latvia and Hungary are the two EU member states receiving such aid as they have been hit hard by the financial crisis.