This year, the geopolitical situation and uncertainty, high prices, and rising bank interest rates continue to affect the Latvian economy. Neighboring countries are also facing similar challenges, particularly the difficult situation regarding export markets, inflation, falling private consumption, and the impact of the European Central Bank’s (ECB) monetary policy. Foreign trade also continues to be adversely affected by a lack of investment in manufacturing and a lack of demand. The manufacturing sector is recovering slowly across the Baltics, with positive trends in Lithuania and improvements expected in Latvia and Estonia. The tourism sector is also experiencing relatively slower recovery and growth in the post-Covid period in the EU.
On 23 April this year, the Government endorsed the proposal of the Ministry of Economics to reallocate funding between ME budget programmes, with additional funding of EUR 6 million per year to be allocated directly to export promotion and investment attraction activities in 2024, 2025 and 2026, to increase the competitiveness and export performance of Latvian companies both domestically and internationally, as well as to promote high-tech exports while positioning Latvia as a country of sustainable innovation and promoting a coherent international image of Latvia.
"To provide real support to Latvian companies, we need well-thought-out and sustainable state support activities, including additional funding for export promotion and market reorientation, the development of new and innovative products and services, and the promotion of economic activity in Latvia’s regions," emphasizes Viktors Valainis, Minister of Economics.
Within the framework of this funding, the Investment and Development Agency of Latvia (LIAA), in cooperation with industry associations, will implement measures to promote export-enhancing activities, such as conducting the high-quality procurement of cooperation contacts in target countries, ensuring participation in international exhibitions, etc. LIAA will also attract targeted investment projects, develop offers to make Latvian industries competitive, develop and improve sales tools and presentation materials, and carry out other activities. In addition, new export promotion and investment attraction activities will be carried out by the Ministry of Economics over the next three years, including improving the regulation of priority project servicing, developing a regulatory sandbox, permanent regulation of large and important or major events, and improving regulation in other areas.
Additional activities to promote exports and attract investment are expected to bring the annual value of export contracts to EUR 30 million and proactive investment projects to at least EUR 35 million in 2024 and EUR 80 million in 2025 and 2026. At the same time, the number of foreign tourists to Latvia is expected to increase annually, generating additional tourism and event export revenues of at least EUR 41 million in 2024 and at least EUR 50 million in 2025 and 2026.
The draft Cabinet Regulation "On reallocation of the appropriation" can be consulted in detail in the Legislation portal.
Ministry of Economics
Public Relations Department
E-mail: prese@em.gov.lv