3 banks promise $30B for Eastern Europe

BRUSSELS, March 1 (UPI) -- Three development banks have promised $30 billion to keep the financial system in Eastern Europe from collapsing.

The action by the World Bank, the European Bank for Reconstruction and Development and the European Investment Bank may stave off disaster, but analysts warned that the bailout package would not be enough, The Independent reported.

"Ultimately we will have to get a much bigger package and a coordinated response from the IMF, the EU and maybe the G7," said Nigel Rendell, who analyzes emerging markets at Royal Bank of Canada in London.

The three Baltic states, Hungary and the northern Balkan countries are in especially fragile condition. The economy of Latvia, after years of high growth, could see 15 percent shrinkage this year.

Other countries, like Poland, the Czech Republic and Slovakia are being hit by drop in worldwide demand for their exports.

A butcher in a Budapest market said her customers are buying smaller and cheaper cuts of meat. She is in trouble because she borrowed at low interest from a Swiss bank and now has to pay off the loan in devalued forints.