Latvia has been promised an extra €200 million of EU money as part of a joint €7.5 billion loan between the bloc and the International Monetary Fund - if the government makes “significant” further savings. The IMF is prepared to release €105 million under the same agreement. The European Commission said, on 20 July, that high deficit and debt levels mean more cuts need to be made in 2011. The loan was agreed in late 2008 but last year faced a hiccup as Riga’s budget looked like it would not make the necessary savings to bring the budget deficit - which stood at 9% of GDP in 2009, three times the EU’s limit - down to 8.5% this year. The €200 million marks the fourth instalment of the Commission’s €3.1 billion share of the loan, leaving around €400 million still to draw down.