Estonia

Businessman Urmas Sõõrumaa and his partner Gunnar Kool’s plan to establish one of the leading luxury clothing and accessories chains in Eastern Europe has failed. Last week the court started bankruptcy proceedings for Versus Invest, Eesti Ekspress reported. Franchiser Versus Invest operated ten stores that sold clothing and accessories by Hugo Boss, Joop, Calvin Klein and Zegna. Six of them were in Estonia, one in Latvia and three in Belorussia. According to the plan, Versus Invest was supposed to open ten new stores during 2009.

Moody's Investors Service placed the bond ratings of Estonia and Lithuania on review for possible downgrade Tuesday, citing severe deterioration in the regional macroeconomic environment. Analysts said a downgrade was likely. The three Baltic Sea-hugging neighbors Latvia, Lithuania and Estonia face an uphill struggle to resuscitate their economies, mired in recession or headed there, rein in their current-account deficits and maintain their currency pegs, MarketWatch reported. Within the emerging-markets universe, Eastern Europe is the region most vulnerable to economic and financial risk.