RIGA — The International Monetary Fund announced Friday that it supported Latvia’s new proposed budget for 2010 and would be ready to approve it.

The IMF’s thumbs-up hasn’t stopped domestic criticism. The has government met harsh criticism from all corners with every new revision of the budget, which features deep cuts to the public sector.

“We continue to support the authorities’ extraordinary efforts to overcome the country’s crisis, with the principal aim of helping the Latvian people contain the worst of it and to put the country on a faster path to economic growth and recovery,” David Moore, IMF resident representative to Latvia said.

An IMF mission will visit Riga from Dec. 2 to hold discussions on the second review of the IMF’s Stand-By Arrangement (SBA), the €7.5 billion bail-out package from international lenders. The mission is expected to last about two weeks.

“In the recent weeks, program partners have held fruitful discussions with the Latvian authorities regarding the 2010 budget. The government has now approved a revised budget proposal for 2010 that would meet the authorities’ commitment to implement new fiscal adjustment measures of 500 million lats (€700 million), which amount to about 4 percent of gross domestic product,” Moore said.

The Latvian ruling coalition has been trying to dodge obligations to trim the full 500 million lats from the budget arguing it would lead to dire consequences, but international lenders responded to complaints furiously demanding strong and decisive leadership that kept to the agreed conditions of the loan.

Latvia needs to comply with the conditions of the loan taken out from the IMF under the previous government, which was led by former Prime Minister Ivars Godmanis, in order for the rest of the disbursement to take place.

So far, Latvia has only received part of the €7.5 billion loan. The full sum will only be deposited when international lenders are satisfied with the government’s budget.

Latvia’s economy has been hit hard by the economic crisis with plummeting gross domestic product figures and skyrocketing unemployment.