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BRUSSELS, June 9 (Reuters) - Swedish Prime Minister Fredrik Reinfeldt said on Tuesday he did not expect the economic crisis in Latvia to have a big impact on his country's economy.
Swedish banks' exposure to the Baltics has raised fears that a Latvian meltdown could have effects across the region.
Reinfeldt told reporters in Brussels: "I am convinced we have taken steps that we can control anything that happens in Latvia, and that it will not have a huge effect on the Swedish economy and that we will not send the bill to Swedish taxpayers."
Investors have been concerned Latvia might not win access to the next instalment of its 7.5 billion euro ($10.4 billion) International Monetary Fund and European Union rescue loan.
But Latvia's government and coalition partners agreed on Monday to cut the country's 2009 budget, a move that could help it secure more emergency loan funds and stave off pressure to devalue its currency.
"We've now got a signal that they're putting another package together ... The government of Latvia is very clear that in that they want to push through this crisis and want to meet the requirements put up by the IMF," he said.
He said programmes were in place that meant Sweden's government would step in including to take part ownership, if Swedish banks got into trouble because of their exposure in Latvia.
"We will deliver on this -- we've done that in history -- if need be," Reinfeldt said.
"We might end up again owning more banks but then we will have an exit strategy to that, to say that when confidence comes back to the market we will put them back to the market again." (Reporting by Timothy Heritage; editing by Mark John/Dale Hudson)