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Latvia political briefing: Latvia – 5G pioneer in the North of Europe

In July 2019, Latvia became one of the first countries in Europe[1], which introduced 5G network coverage. Latvia is ahead of such European countries as Sweden, Norway, Lithuania, France, Estonia in the area of Internet coverage and becoming one of the 5G network leaders worldwide. 5G is currently developing an environment in Latvia that will be able to ensure a higher level of exports, thereby making it possible to compete globally. The development and use of 5G compatibility have been one of the priorities of the European Parliament which means not only speed and coverage, but also a series of functions that will be provided for sensors and other equipment in the digital environment. 5G was introduced in Latvia by “Latvian Mobile Telephone” (LMT), one of the most ambitious and innovative companies in Latvia with more than 25 years of experience in the telecommunication sector.

Latvia is known throughout the world for its fast Internet connection, while at the same time providing low costs for its consumers[2]. As a result, Latvian telecommunication companies such as LMT can provide solutions to processes that consume huge amounts of data daily. Latvia is experiencing increasing trends in Internet connection consumption. In recent years, the usage of Internet in Latvia has increased rapidly.[3] As Latvian mobile operators can ensure free access to fast Internet, with consumer-friendly cost, customer demand in Latvia is still growing. For this reason, one of the challenges for the telecommunication operators in the future will be to provide common information capacity while maintaining the security of data transmission as well as stability.

The deployment of 5G-enabled technologies can have high added value for businesses, attracting investment and increasing national competitiveness. The implementation of 5G in Latvia means a breakthrough in technology that will create new industries and will have a positive impact on existing industries and change our daily lives.

In Latvia, there will be many benefits from the introduction of 5G network coverage. Not only will the population of Latvia have access to several times faster internet connection, but the introduction of the 5G network will also provide the possibility of running many more Internet of things (IoT) (system of interrelated computing devices, mechanical and digital machines) devices simultaneously as well. 5G coverage in Latvia will also expand opportunities for 4G network coverage. For example, the NarrowBand IoT will allow mobile internet to be provided in places where it was not possible until now. Similarly, it is now possible to establish local mobile networks on the 4G network for the needs of a particular company or authority.[4] The introduction of 5G network coverage in Latvia will also improve the stability of the data transmission connection and the security of the network coverage. By that guaranteeing an uninterrupted data exchange as well as an improvement in response time. These improvements would be able to help to implement and guarantee high-quality solutions in Latvia, such as the development of the digital economy, remote drone management, unmanned vehicles.[5] 5G Technologies has high added value and can provide a new business, investment attraction and increase national competitiveness.

Although 5G network coverage has only recently been developed in Latvia, LMT has already started developing and presenting innovation of the defense industry for export. 5G will open up unprecedented mobile capabilities, such as creating a dedicated transmission channel to security authorities, so that the rest of the Internet does not interfere with the channel.[6] LMT has introduced its potential clients with other innovative solutions in the security field – mission management system, drone traffic management, computer vision and other. The development of 5G in Latvia has contributed to the creation of new potential areas of export, as well as the development of new products in Latvia.

The implementation of this powerful 5G network has enabled Latvian entrepreneurs to develop new ideas in the technology sector. Together with internal affairs and defense sector authorities, LMT, in cooperation with Riga Technical University, is developing new, innovative solutions for national defense. By being able to successfully provide internet coverage in Latvia has allowed LMT to be involved in various European projects. All of this results in the development of mission management systems that integrate both human communication and various IoT sensors to assess the situation more quickly and to be able to make more accurate decisions.

The income from the information and communication technology sector in Latvia’s state budget has increased from €289 million in 2015 to €356 million in 2017, as well as exports of the Information and Communication Technology sector are experiencing rapid growth.[7] The introduction of 5G in Latvia will mainly support the information and communication technology sector. The introduction of 5G will significantly improve the environment of this sector in Latvia, thereby strengthening the leaders’ position in terms of building the communication infrastructure, which will also have a significant impact on the state’s budget.

Latvia is experiencing an increase in the number of information and communication companies that introduce innovations that are competitive in the global market. For example, “Giraffe Visual” is one of the first companies in Europe to provide the highest-quality interactive visualization in 360 ° virtual tour format, 360 ° video, interactive presentation technology as a service for touchscreen surface and virtual reality. from a small Latvian youth company that built virtual tours for guesthouses in Latvia for a couple of years, they have become industry leaders in Europe with clients in 27 countries. This is just one of many examples. Business incubators, accelerators are currently active in providing financial support, working spaces, self-growth seminars for young Latvian entrepreneurs. In particular, capacity building for information and communications companies is supported. The support of the state and the introduction of 5G coverage in Latvia will provide technology companies with a better environment to carry out their potential, thereby contributing to the development of the economy in Latvia.

Education and the development of 5G have a common future in Latvia. With the introduction of the new education reform in Latvia, emphasis will be placed on the acquisition of information technologies, promoting high computer skills for pupils. The number of students in the information and communication technology sector has also increased in recent years.[8] It is therefore important that future professionals in this sector are provided with an environment that is competitive with the global market, an environment for improving their knowledge in the field of information and technology. Developing 5G specifically in Latvia will allow students to operate with big data, create innovations in the information and technology sector.

“Big data is a key basis of competition, productivity and innovation development nowadays. Mobile telecommunications is an industry which espouses well with big data concept. Experts predict that in the next few years, 50 billion different smart devices will use to collect, analyze and share data. The amount of data in our world will explode. Data management and analysis steps show – Big data is from mere buzzword – big data is here to stay” – stresses the President, Chairman of the Management Board of LMT Dr, Prof. Juris Binde.

A significant benefit of 5G Internet coverage in Latvia will be job efficiency. 5G will improve business efficiency and productivity, as well as make easier people’s everyday life. Due to the high speed of the 5G Internet, it will be possible to improve and implement smart solutions, not only in the technology sector. For example, the ability to transfer and process large-capacity data more quickly will improve the functioning of public administration, health care, education. 5G network coverage will ensure a rise in job productivity in Latvia.

Similarly, 5G allows information to be processed not only centrally but also locally in the base station area to perform data analysis quickly and in a restricted field. LMT, together with the University of Latvia, has already developed a method for evaluating the regional economic activity, based on big data from the mobile network. Mobile data analysis makes it possible to measure population dynamics, plan infrastructure and find many more effective solutions. This study has shown good results and confirms the potential for large data use in Latvia.

Although the introduction of 5G brings a lot of benefits to the Latvian economy, almost every fifth of the population (17%) believes that 5G technology in Latvia should not be implemented.[9] One of the reasons explaining the resistance to the deployment of the 5G network in Latvia is the disinformation campaigns in the social networking apps like Facebook, which uses distorted and false facts about 5G technologies that have been shared by several hundred people, thereby reaching thousands of others[10]. Surveys show that against 5G implementation are older people or people with a low level of education. The financial situation of people has also great importance. The higher it is, the more positive attitude towards the introduction of new technologies in Latvia is received.[11] As part of this disinformation campaign, there was even a protest against 5G in Latvia this year.

It is worth noting that in Latvia the electromagnetic radiation rate is supervised by the Health Inspectorate. Commenting on the hazards of 5G waves, the Latvian Health Inspectorate stresses that there are no grounds to question the effects of 4G or 5G on human organisms.[12] The commercial operator must confirm the safety of the antennas with special certificates to install them. Independent measurements are performed after the installation of the antennas. The measurements ordered by the Health Inspectorate have never shown deviations from the norm.[13]

In order to successfully implement the 5G network in Latvia and use full capacity that this technology offers to Latvia, the world’s first hackathon of 5G policymakers took place on 26th and 27th November 2019. This 5G hackathon is an innovation in policymaking. The event aimed to bring together all sectors involved in 5G technology to assess current challenges related to 5G and to develop recommendations to promote 5G innovation in the Baltic Sea region.[14]

With the help of this hackathon, industry professionals, representatives of the Baltic and European region met in Riga to recommend more appropriate legislation for the opportunities that will create 5G technologies, while making the Baltic region a 5G innovation leader in the world. By creating this type of hackathons, the Latvian government has shown that it cares about entrepreneurs in its region and that the government wants to provide a business-friendly, innovation-friendly environment.

The current legislative framework is not suitable for achieving the maximum efficiency of 5G technologies. Innovative policy-making tools such as the 5G hackathon have helped Latvia, as well as the Baltic Sea region, together with professionals in its field, take the first steps towards a common approach in establishing a legal framework. The regulatory frameworks must be not only conducive to innovation but also safe for consumers and others.

As has already been shown, in the future 5G technologies will have the opportunity to boost economic growth, so Latvia is already creating appropriate laws that support both entrepreneurs and households. Important topics as cross-border transport problems, infrastructure issues, personal data protection challenges, security, data availability were discussed in the hackathon.

“5G is one of those technological breakthroughs that has the potential to change the way we live. We have to be responsible for creating an environment and legislation at a cross-border level that will enable new innovations and increase our economic competitiveness globally. That’s why the first-ever 5G policymakers’ hackathon will bring together the key representatives from all Baltic Sea Region countries to create common recommendations for policymakers, to help them to prepare better legislation for the possibilities that 5G technologies will create, and to establish the region as leaders in 5G innovation.” – Ralfs Nemiro, Minister of Economics of the Republic of Latvia.

5G hackathon was just the beginning of creating a single policy for 5G across the Baltic Sea region. After the hackathon, the Ministry of Economy and members of the hackathon had prepared 5 recommendations for the policy makers, which are planned to be discussed.[15]

[1] https://www.speedtest.net/ookla-5g-map

[2] http://research.rewheel.fi/prices/country/

[3] https://tefficient.com/usage-up-but-monetisation-falters/#more-5431

[4] https://www.lmt.lv/lv/preses-relizes?g=2019&pid=913

[5] https://www.lmt.lv/lv/preses-relizes?g=2019&pid=912

[6] https://www.lmt.lv/lv/preses-relizes?g=2019&pid=913

[7]https://2018.economicforum.lv/wp-content/uploads/2019/10/Rezololucija.pdf

[8] www.izm.gov.lv.

[9] Latvian research centre SKDS

[10] https://www.facebook.com/patiesibapar5g/

[11] Latvian research centre SKDS

[12] http://www.vi.gov.lv/lv/sakums/aktuali/this-just-in-2019/par-5g-elektromagnetiska-starojuma-ietekmi-uz-cilveka-veselibu

[13] https://www.lsm.lv/aizliegtais-panemiens-operacija5G

[14] https://www.em.gov.lv/en/news/25997-the-first-ever-5g-policymakers-hackathon-announced

[15] https://www.em.gov.lv/en/news/26377-5-policy-recommendations-from-the-first-ever-5g-policymakers-hackathon

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

Latvia economy briefing: Economic and Scientific Cooperation between Latvia and China is increasing

China has always been an important partner for Latvia. Both of these countries share common objectives not only in the sustainability and welfare sector but also in the promotion of entrepreneurship and the implementation of investment projects. It is important to note that China was one of the first countries to recognize the renewal of Latvia’s independence, which has led to close cooperation between the two countries over the last 25 years.

The trade activities between Latvia and China are increasing year after year and China is currently one of the largest trade partners of Latvia outside the European Union. As a result of close cooperation between the two countries over the last 10 years, the value of exported and imported goods has increased repeatedly. Exports to China during January- October 2019 reached 131.37 million EUR, which is 5.25 times more than in 2010. Imported goods from China amounted to 434,25 million EUR during January-October in 2019, which is 2 times more than in 2010.[1]

The main export goods from Latvia to China in 2019 were: wood and its products (52.86%, mainly raw timber); mineral products (13,61%); machinery; electrical equipment (9.35%, mainly electronic integrated circuits); metals (4.49%); vegetable products (6.72%, mainly fruits and nuts).

The main import goods in Latvia from China in 2019 were: machinery; electrical equipment (50.76%, mainly mobile communication devices); various industrial goods (9.86%, mainly lamps and lighting accessories, furniture); plastics; rubber and rubber products (8.15%, mainly tires); metals (6,83).%, mainly metal structures); textiles (5.59%); products of the chemical industry (4.99%, mainly ready-to-use binders for ingots and cores) .

Cooperation between Latvia and China takes place both bilaterally and within the framework of EU-China relations and in various multilateral formats, such as in the format of cooperation between Central and Eastern European countries and China (17 +1) and the framework of the “Belt and Road” initiative.

Latvia’s priorities in these projects are cooperation in the transport and logistics sector, attracting investments in infrastructure and production projects, promoting trade links and tourism, and exchanging students and teaching staff.

On 4 November 2016, Latvia signed a Memorandum of Understanding between the Government of the Republic of Latvia and the Government of the People’s Republic of China on cooperation in the economic bands of Silk Road. The memorandum was signed based on the traditional friendship between the people of Latvia and China, great cooperation between the two governments and efforts to work together to promote the economic bands of the Silk Road. The two countries undertook to work together in the “Belt and Road” initiative to pursue the objective of joint development and to turn their strengths – political dialogue, complementarity in the economic field and people-to-people contacts – into practical cooperation and sustainable development. In this way, promoting political relations, economic links and people-to-people contacts between the two countries.

As part of this initiative, the first container train from the Chinese city of Yiwu entered Riga in November 2016, which drove more than 11,000 km in only 12 days. Yiwu’s commercial platform “Yiwu Timex Industrial Investment Co.” has included Riga as one of the routes of the global movement of goods on its map, and rail transport is considered to be the most forward-looking way of transporting goods to Europe. [2]It cannot be denied that although this New Silk Road initiative is more focused on the development of the logistics and transport sector, it would also have a positive impact on trade volumes in Latvia.

Since the first successful container train pilot trip, Latvian businessmen and producers have increased interest in export opportunities in China. Following the successful shipment of the first train, interest in the Latvian corridor has also increased in China and more entrepreneurs are now interested in the possibility of cooperation. Yiwu representatives are convinced that the Yiwu – Latvia route has potential, but there is a need for closer interaction between shippers, consignors, railways, terminals, and customs, which would contribute significantly not only to transport but also to trade relations between the two countries.[3]

The “Belt and Road” project is very important for the Latvian government and the representatives of the state institutions make a major contribution to the promotion of international cooperation. For this reason, Latvia was invited for the second time to the “Belt and Road” forum in Beijing, which took place in 2019 from 25 to 27 April. During the first forum held in Beijing in 2017, the Ministry of Transport highlighted four priorities for cooperation with China: aviation, rail, maritime, industrial parks, and proposed six measures to deepen cooperation with the countries involved in the initiative.

Since then, transport and logistics companies from Latvia and China have been actively cooperating and have achieved significant results in both bilateral and multilateral cooperation.

In particular, the National Latvia’s Post and International Airport Riga are cooperating successfully with Chinese companies, providing effective solutions for the delivery of e-commerce messages to customers in Europe and third countries through Latvia. Latvia’s railway representatives, along with the Chinese railway, continues to successfully develop new container train services by connecting Asia and Europe through the Latvian multimodal maritime and rail corridor. Also, in maritime cooperation, Latvia has been successfully involved in the development of China’s 21. Century Maritime Silk Road, since the end of 2017, China and the world’s largest shipping company have included the port of Riga in the regular Northern European container shipping route.[4] These results in transport and logistics have strengthened confidence, increased market opportunities and created a historical basis for the sustainable development of economic cooperation between China and Latvia.[5]

In March 2019, the Latvian Investment and Development Agency received a delegation from the commerce department of the city of Ningbo (China), as well as the Chinese-based trading company “China-Base Ningbo group Co. Representatives of Ltd” to discuss the creation of a Chinese-Latvian e-commerce center in Riga. The capital of Latvia has been designated as the best place through which the supply of goods to other European countries would be ensured according to the “17 +1” cooperation format. The logistics of goods is planned to be coordinated through Riga’s Port, which would have a positive impact on Latvia’s economic growth.[6]

Chinese businessmen have also showed an active interest in expanding their activities in Latvia. Company “MGI” has officially launched new research, development, and production center in Riga to create a Chinese-European life science innovation center. The company has already set up three research, development, and production centers in China — Sheng, Shaun, and Qingdao — and San Jose, U.S. The new 7000 m² large “MGI” center is located at the airport park in Riga.

At the premises of “MGI Latvia” in Riga, a product production center, a high-throughput sequencing center, training, as well as a logistics center will be provided. The company’s role here is to strengthen innovation-related cooperation between China and Europe in the fields of life sciences research, industrial use, and technical standards. This means that cooperation on transnational genomics projects, as well as the exchange of experience and information between companies in China and Europe, will continue through this center.[7]

“Given current biotechnology bases in Latvia, “MGI” feels safe when creating a gene-based life-sciences innovation platform in Europe. Here we will be using the company’s main products and technologies. This will help to advance the equipment needed to research higher-level life sciences in China on the global market by creating a system of technical support and a product supply chain that would meet customers’ needs and allow a deeper understanding of the European market, says “MGI” President Duncan Yu.

There is also close cooperation between Latvia and China in the field of science. Bilateral cooperation with China and the Ministry of Education and Science of the Republic of Latvia is based on the agreement between the Government of Latvia and China on education cooperation signed on 22 November 2017. This agreement gives students opportunities such as going on exchange trips, as well as students can receive scholarships for studies and participate in different summer schools. Besides, China and Latvia have agreed on mutual recognition of higher education qualifications and degrees, thereby providing growth opportunities for both Latvian and Chinese citizens. During the 2019/2018 school year there was a total of 45 Chinese students in Latvia. [8]

As well as in 2018, President of Latvia Raimonds Vejonis (2015-2019) closed an agreement with China on cooperation in science and technology, thereby promoting innovation.

Two academic partnership centers have been created as a result of cooperation to strengthen partnership of the both countries in the field of education and science – the University of Latvia in cooperation with North China Institute of Science and Technology both founded academical partnership centers in their premises. As a result, Chinese students have the opportunity to learn Latvian and its culture, while Latvian students have the opportunity to learn Chinese as well as understand Chinese culture, thereby extending the possibilities of cooperation between the two countries.

[1] https://eksports.csb.gov.lv/en/countries-selected/export/2019/TOTAL/CN

[2] http://www.sam.gov.lv/sm/content/?lng=lv&cat=112

[3] https://www.mfa.gov.lv/component/content/article/56316-latvija-un-kina-viena-josla-viens-cels-satiksmes-ministrija

[4] https://www.mfa.gov.lv/component/content/article/56316-latvija-un-kina-viena-josla-viens-cels-satiksmes-ministrija

[5] http://www.sam.gov.lv/?cat=8&art_id=8885

[6] http://www.la.lv/kinas-uznemeji-velas-latvija-izveidot-verienigu-e-komercijas-un-logistikas-centru

[7] https://labsoflatvia.com/aktuali/mgi-centrs-riga

[8] The Ministry of Education and Science of the Republic of Latvia “Report on Latvia’s higher education in 2018”

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

Latvia social briefing: Latvia is an increasingly popular destination for health tourism

Latvia is an ideal place to pay a visit for medical and well-being tourism. It offers a wide range of affordable medical services. Users of this service in Latvia have not only the opportunity to obtain high-quality services for improving health but also, receive a unique opportunity to gain insight into Latvia’s glorious nature and cultural and historical heritage. Every year around 10 thousand visitors travel to Latvia in health tourism to improve their well-being. According to data, representatives of various countries from around the world have traveled to Latvia in medical tourism: Germany, China, Britain, Finland, Ukraine, Sweden, Lithuania, Norway, Estonia, Canada, Ireland, Israel, Russia, France, Azerbaijan, India, Italy, Kazakhstan, Belarus, and other countries.[1]

In the last years, health tourism has become a growing industry. Between 2017 and 2023, the average growth in this sector is projected to reach around 15% annually.[2] This is due to the increasing number of opportunities for customers to improve their current health at friendly prices, as well as at the same time, in cooperation with the tourism sector and local authorities, tourists are given the opportunity to explore the cultures of different countries. The greatest demand for medical tourism is shown by people from countries such as Sweden, Ireland.[3] There are different reasons for the consumers why they choose to carry out different procedures abroad. One explanation is that, in both Western and Nordic countries, price levels are much higher than in Eastern European countries.[4] Consequently, people choose to perform some medical procedures that tend to be high-priced, elsewhere. In addition, consumers choose to go to medical tourism to carry out manipulations that are not available in their own country or because of faster service abroad as well.

The most popular healthcare services of foreigners in Latvia are dentistry, gynecology, and urology, beauty, as well as general medicine. According to the survey, people choose to go in medical tourism to Latvia because of technology, as well as low costs.[5]

The 2018 summary of comparisons of medical manipulation costs with other countries shows that medical services in Latvia are 5 to 10 times cheaper than in the United States. However, comparing the costs of medical treatment with Germany, Norway, and the United Kingdom, the cost of medical services in Latvia is 2 to 3 times lower.[6] Latvian clinics are characterized by a well-thought price policy without hidden premiums. Service prices in Latvia are competitive in the Baltic Sea region, lower than in Western and Scandinavian countries, which allows patients to save between 50 and 70% of costs.

These days, Latvia’s health centers – rehabilitation complexes, clinics – are high-level. By combining professional knowledge of Latvian doctors, as well as modern medical treatment facilities, an effective result of the improvement in patient health is expected. Latvia is a popular destination not only for medical tourists but also for future doctors from different countries around the world who choose to study medicine in Latvia.[7] In order to qualify as a doctor in Latvia, students must acquire internationally recognized education, as well as constantly learn newer, more effective medical treatment methods. Most often, Latvian doctors supplement their qualifications in foreign training, as well as in the exchange of experience programs. The most knowledgeable and noteworthy doctors have also carried out international exemplary operations. Only competent specialists work with medical tourists. It should be noted that due to the geographical situation, doctors manage both English and Russian, thereby ensuring a mutual understanding between the doctor and the patient. If necessary, interpreter services shall also be provided.

The proposed health care in Latvia meets the standards of the world’s leading clinics while improving the level of prices for consumers. In work with medical tourists, they are offered only equipment in accordance with international quality standards. Every year Latvian doctors, together with medical specialists from other countries, develop a variety of scientific studies, thereby promoting operational disease diagnostics, as well as effective patient therapy.

Specialists in the Latvian medical sector want to ensure the best possible quality of service for their patients in order to promote a high level of wellbeing. For this reason, Latvian health authorities maintain close cooperation relations with the leaders of the world’s medical equipment manufacturers. Medical equipment is regularly updated to ensure compliance with international standards. One of the reasons why people choose to travel to Latvia is modern medical equipment, thus quickly and painlessly obtaining fast and accurate results of the medical testing. Innovative testing methods are available in Latvia, some of the methods are unique in the Baltic and Eastern Europe.

For example, in May 2019 the only PET/CT equipment was introduced in Latvia, which allows receiving more accurate results of testing for patients with oncological, neurological, cardiac, and other diseases to be obtained at an early stage. This technology provides early detection of cancer disease and patient safety during the examination. This procedure is one of the most accurate methods of cancer diagnosis that combines the images, thereby obtaining a quick and accurate insight into the spread of the disease process.[8] It is important to note that this technology is currently the only one in Central and Eastern Europe.

Prior to going to medical treatment institutions in Latvia, close cooperation is established with the patients, and personalized medical treatment is created for them. In addition, on request, services such as welcome at the airport, escorts, interpreters shall be provided to ensure as much comfort as possible. Treatment methods have been developed in Latvia for patients of any age, both adults and children, starting from the age of the infant. During the visit, patients may stay in hotels or sheltered hotel-type rooms with all amenities.

The most popular destinations for health tourism are the resort city Jurmala, as well as the capital city Riga. Several sanatoria, rehabilitation centers are available in Jurmala, which offers a wide range of services – water procedures, massages, readjustments, arts treatments, and other procedures. People choose to travel to sanatoria from abroad most often in summer because most of the sanatoria are on a 5-minute walk from the Baltic Sea, where people can spend time after treatment procedures in a peaceful climate of seaside and pine forests. In Jurmala, there are also a lot of concerts and events with artists from around the world during the summer period. Health tourists have the opportunity not only to improve their health status but also to enjoy the Latvian climate, visit cultural events and explore Latvia’s cultural and historical heritage.

Riga is chosen by those health tourists who have to undergo medical manipulation. There are many high-class clinics in Riga that provide services in sectors such as dentistry, reconstructive, and plastic surgery, aesthetic medicine, ophthalmology, neurology, and the treatment of psychiatric neuroses. After performing clinical manipulation, it is possible for patients to become acquainted with Riga – the capital of Latvia. Riga is one of the oldest cities in Latvia. There are very well-preserved Art Nouveau buildings in this city, a glorious old town where buildings of different ages can be seen. To add Riga’s residents are very kind and caring to tourists because they manage both Russian and English languages.

Latvia is an increasingly popular destination for health tourism. This is mainly due to the range of various benefits – the availability of modern medical equipment, low costs, professional doctors, providing maximum comfort to their patients.

Foreigners choose to travel to Latvia not only because of the beneficial supply of medical services but also in order to improve their well-being and physical state by participating in various sports activities. In recent years, marathons of different popular sports have become more popular in Latvia, gathering participants from different countries around the world. The most popular public marathons in Latvia are the cycling marathon and the running marathon, which have already become a traditional event for Latvia’s largest cities.

One of the most familiar and brightest examples is the Riga Marathon, which gathers several tens of thousands of runners from more than 80 countries annually. [9]The Riga marathon has become a tradition for the most active citizens of Riga in recent years, as well as a great opportunity for tourists to get to know Riga by running. The marathon involves a number of running distances that are suited to both professionals and families with children.

The Riga marathon is internationally recognized as one of the planet’s top-class marathons. The World Athletics Association has recognized the Riga marathon as a noteworthy marathon, regranting the Golden Label nomination annually. This high assessment, which was given only to the Riga marathon in Northern Europe, attracts more and more tourists and sports enthusiasts from different countries around the world every year. This nomination has secured the status of the most important marathon for the Riga marathon in Northern Europe. In addition, the Riga marathon is included as one of the 175 best marathons in the world, in which runners can qualify for the World’s Championship in a marathon in different age groups.

[1] https://healthtravellatvia.lv/medicinas-turisms-latvija/

[2] Allied Analytics LLP. Medical Tourism Market by Treatment Type – Global Opportunity Analysis and Industry Forecast, 2017-2023 September 2017

[3] Eurobarometer

[4] https://ec.europa.eu/eurostat/news/themes-in-the-spotlight/price-levels-2018

[5] Dr. Juris Hāzners, Dr. Ņina Linde: tirgus pētījums par latvijas veselības tūrisma attīstības perspektīvām ārvalstu iedzīvotājiem, SIA “Latvijas Zinātņu akadēmijas Ekonomikas institūts”, 2018

[6] https://healthtravellatvia.lv/wp-content/uploads/2019/09/proceduru_cenas_tabula-en.jpg

[7] The Ministry of Education and Science of the Republic of Latvia “Report on Latvia’s higher education in 2018”

[8] https://arsmed.lv/2019/05/ars-diagnostikas-klinika-iepazistina-ar-baltija-pirmo-digitalo-pet-ct-iekartu/

[9] http://rimirigamarathon.com/lv/par-maratonu/world-athletics-gold-label/

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

Latvia external relations briefing: ACHIEVEMENTS IN FOREIGN POLICY OF LATVIA IN 2019

The 30th anniversary of the fall of the Berlin Wall and the Baltic Way solidarity demonstration allowed Latvia to look back on what has been achieved and reminded us of a dynamic and changing international environment. A new European Parliament and Commission with new objectives and tasks have been elected in the European Union. The rhetoric and behavior of the administration of the US President Donald Trump have a profound impact on the international system and regional dynamics also in Latvia. At the same time, the US has consistently held on to its commitment to strengthen security on the alliance’s eastern flank, and it has motivated the allies to do their homework. The NATO Summit in London has re-affirmed solidarity within the alliance, while reminding of the need to continuously strengthen both the fundamental principles of the transatlantic alliance and cooperation between its member states.

2019 also stands out for two more anniversaries – it has been 15 years since Latvia became a proud member of the EU and NATO. Active participation in these key organizations is a testament to both the sustainable development of our country and the endurance of its Euro-Atlantic ties.

For international relations, 2019 was not an easy time. The institutionalized international political order of the last century continued to undergo significant changes. International institutions, international law and free trade, and international political values are no longer self-evident, but under increasing pressure and in need of our support. On the Latvian foreign policy front [1] in 2019 we should look at a trio of power centers – U.S.A, Russia and Europe.

Latvia and U.S.A

Changes within top echelons of the US administration, political turmoil within the country and uncertainties in US foreign policy have continued to unsettle international relations in 2019. US policy towards Russia remains embroiled by issues raised during investigation into Russian interference in the 2016 presidential election. Meanwhile, Trump had another meeting with Putin at the Osaka G20 Summit in June, and after the G7 meeting, announced that next year’s meeting in the USA would see a return to the G8, with the presence of Russia again at the table. Russia’s role in Syria appeared strengthened after the sudden and seemingly uncoordinated decision by Trump to withdraw troops. This uncertainty and unpredictability of actions of Trump’s administration towards Russian Federation caused tension in Latvia’s policy-maker circles.

Latvia is interested in strong ally fully committed to democratic values and human rights, therefore domestic policy of U.S. is also of Latvia’s concern. Staunch support for the EU and NATO is not only a necessity that has been dictated by the life and experience: it has become a part of Latvia’s foreign policy identity, and it would require something extreme to happen for things to change in this regard. Significant changes in Latvian foreign policy can happen because of shifts in the international order.

Good news for Latvia, America’s commitment to defending Europe remained undiminished during 2019, with an armored brigade combat team being deployed on a nine-month rotating basis. This is supported by the prepositioning of equipment for a second team that could deploy if a need were to arise. US engagement in the Eastern Flank remains solid, with plans to deploy a further 1,000 troops to Poland. Washington has doubled its financial support for its European deterrence initiative to 6.5 billion euros.

In their turn, Latvia and neighboring NATO countries contribute 2% of GDP towards defense. The 2019 Consolidated Budget Law passed by the parliament of the Republic of Latvia, Saeima, on 3 April, set the defense spending at 2% of the GDP, or EUR 636.65 million having reached the increase of EUR 60.3 million if compared to the plan of 2018. [2] Latvia is fully committed to keeping the national defense expenditure at this level for the foreseeable future.

Latvia and Russia

Along with USA, the external relations policy of Latvia has to deal with Russia as the close neighbour of Latvia and global power which can influence international affairs. Dialogue between Russia’s president and his Western counterparts can yield positive results, as long as a unity of approach prevails and attempts to “divide and conquer” are rejected. Dialogue should also take place on the basis that NATO’s defense and deterrence policy remains robust in parallel with any agreements.

In 2019, on a more regional level, Latvia has contributed to practical relations with the neighbor. Latvia’s presidency of the Council of the Baltic Sea States, which includes Russia, provided a focus on practical projects relating, for example, to climate change, spatial development, cultural heritage and societal security. The closing meeting in Jūrmala gave Russian Deputy Foreign Minister Alexander Pankin the opportunity to hold a productive bilateral meeting with Latvian Foreign Minister Rinkēvičs.

Latvia and European Union

In 2019, life in Europe involved the anticipation of change – everybody was waiting for the new composition of the European Parliament and of the Commission, Latvia was waiting for the final words on the exit of the United Kingdom from the European Union, for future decisions on the multi-annual budget, for enlargement. Brexit elicited an unprecedented political and constitutional chaos in the United Kingdom in 2019. The government kept Latvians in the UK well-informed and advised on how to deal with various scenarios.

The results of the European Parliament elections confirmed that Europeans are calling for change. Sixty percent of the newly elected MPs are new, and the majority of political groups are no longer made up of only two parties. The new balance of power prevented the possibility of old ways of agreement. At the end of the year, the European Parliament approved the new European Commission with a new president Ursula von der Leyen, who has already come out with an ambitious and comparatively more social agenda than the previous one.

In those new conditions Latvia gained some influence in Europe. An important role is planned for Latvia’s European Commissioner Valdis Dombrovskis in the achievement of priorities for reducing inequality; he has been nominated for a position as an EU executive vice president with the “Economy That Works for People” portfolio, with the goal of combining the social dimension and the market dimension of the economy. Dombrovskis was given not only an important portfolio, but also the role of one of three “executive vice presidents” along with Danish and Dutch political heavyweights Margrethe Vestager and Frans Timmermans. For Latvian MP it is very ambitious position to achieve.

Also European experience of Latvia’s Prime Minister Krišjānis Kariņš has ensured that Latvia has a high-profile and dynamic role in Europe that has not been previously seen, with the foundations having been laid by veteran Foreign Minister Rinkēvičs. Additionally, Latvian diplomats were allocated high positions: Ilze Juhansone as interim EU General Secretary and Pēteris Ustubs as chief diplomatic adviser on the team of new Commission President Ursula von der Leyen [3].

Previously another opportunity for Latvia to play a decisive role in EU political dynamics came at the informal summit of Heads of State and Governments in Sibiu, Romania on 9 May 2019. Through some determined actions, Prime Minister Kariņš approached President Macron to let him know that Latvia wanted to join the French initiative within the EU on climate change – Latvia then joined a group of eight European member states that support the setting of more ambitious goals for Europe: achieving climate neutrality in the region by 2050. This required Latvia to reconsider its national position in order to achieve the goal. Remarkable, that this decision of Latvia to join the climate change initiative came as a positive surprise to the French. Moreover, Latvia’s decision, according to conversations with French officials thereafter, changed the dynamics surrounding this initiative. It is one of the greatest achievements of Latvia in the external relations.

Conclusion

Latvia has done very well in external relations in 2019. In any event, Latvia’s foreign policy was neither dead nor buried, but rather it was very much alive and invigorated. Consistency and strategic patience are required from Latvia in handling both Russia and America. The rhetoric and behavior of the administration of the US President Donald Trump have a profound impact on the international system and regional dynamics. At the same time, the US has consistently held on to its commitment to strengthen security on the alliance’s eastern flank, and it has motivated the Latvia to grow their defense expenditures.

Kariņš role as negotiator for the EPP and appointment of Valdis Dombrovskis to an executive vice-president role in the Commission were both successful foreign policy achievements for Latvia in the complex environment of EU power negotiations. At the beginning of 2019, very few people could have anticipated that Latvian politicians would make such good use of the opportunities presented by changes in EU institutions during the course of the year. Kariņš’s long tenure in the European Parliament and Dombrovskis’s sound reputation were clearly important contributing factors in this.

It is worth to say, that Latvia’s minimal resources were used to maximum effect in Europe in 2019.

REFERENCES

[1] Latvian Foreign and Security Policy. Yearbook 2020

[2] Website of the Ministry of Defense of the Republic of Latvia. https://www.mod.gov.lv/en/news/pabriks-spending-2-gdp-defence-we-are-significantly-strengthening-combat-capabilities-latvian

[3] Lieģis, I. Alive and Kicking in 2019. In: The Latvian Foreign and Security Policy Yearbook 2020

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

Latvia political briefing: LATVIA AS THE CENTER OF THE GLOBAL BUSINESS SERVICES

The Global Business Services sector in Latvia is growing. In 2019, the sector formed around 1.9% of gross domestic product and 2% of total exports.[1] Increasingly, internationally recognized companies choose to centralise the company’s administrative functions in Latvia, replacing it with the performance of functions in each country individually. Global Business Service is developing widely in Latvia – approximately 9,000 jobs places have been created in this service sector.[2] As well as 100 new jobs are offered monthly in the Global Services sector.[3] Around 50 companies are currently registered in Latvia in the field of Global Services.[4]

Latvia’s attractiveness as a Global Business Service center is shown by the A.T.Kearney index, which examines which countries provide the most favourable outsourcing offer. The Global Service Location Index consists of four factors: financial benefits, human resources, business environment, and digital resonance. In 2019, Latvia took 21^st place in the Global Services Location Index, outperforming countries such as the United Arab Emirates, Canada, and Poland.[5] According to index data, mainly companies choose to create a global service center in Latvia due to financial attractiveness and the business environment.

Meanwhile, the Association of Business Services Leaders, which represents the interests of the Global Business Service companies in order to strengthen the development of this growing sector in Latvia, refers to the main reasons for Latvia’s attractiveness, such as a favourable location, a stable, growing economy, supporting infrastructure, access to modern spaces, convenient transport opportunities, financial benefits, educated labour.

Mainly, international companies choose to set up global service centers in Latvia because of the financial benefits. First, Latvia’s salary level is below the average level in the European Union.[6]The employer will, therefore, make savings by hiring the employee from Latvia. Secondly, the overall price level for different expenditure is lower in the European Union.[7] Services such as rental of premises, electricity, water in Latvia are approximately 40% lower than average in the European Union. Spending on communication services – Internet connection, telephone calls – is about a third cheaper than in the European Union on average.[8]

One of the reasons why international companies choose to build global service centers in Latvia is the labor level of knowledge of the official languages. Approximately 96% of Latvian residents know at least one or more foreign languages.[9] In general, Latvians are most familiar with both English and Russian, so global service centres in Latvia can work with both the East Market and the Western Market. Data shows that overall 16 different languages are used in Latvia’s Global Business Service centers, most often English, Russian and Latvian.[10] Around 18% of all companies in the sector use Danish, Spanish, German, Italian, French, Swedish, less often – Japanese, Lithuanian, Estonian.

The development of the Global Business Service industry and the interest of investors in setting up administrative departments in Latvia, by which they are available to promote the company’s growth, demonstrate that Latvia is able to adapt to business trends by providing a competitive business environment for growth. Along with the advantages of geographic and transportation services, Latvia demonstrates itself as a trusted outsourcing partner for the development of international companies.

In order to promote the development of the Global Business Service sector in Latvia, a joint memorandum was signed in 2018 between Riga Municipality, Investment and Development Agency of Latvia, the Ministry of Economy and others, with a view to taking additional activities in promoting the sector. Within the framework of the Memorandum, an association was founded, which deals with informing the public about job opportunities in the international business sector in Latvia, forms a dialogue with Latvian universities in order to develop the skills, which are needed in the sector, in students . Association and university cooperation have a key role to play in the development of the Global Business Sector in Latvia, it is the most common choice to work in this sector for employees who have recently graduated from university because of the opportunities for international career growth. The association represents several dozen global enterprise service companies in Latvia.

The growth of the Global Service sector has contributed greatly to Latvia. When investing in the creation of new centers in Latvia, international companies not only make savings themselves but also contribute to the Latvian economy. First, global services companies offer higher wages than average in Latvia.[11] Thus increasing the level of welfare, as well as increasing the total revenue of the Latvian Government. It is worth noting that the international business services sector provides health insurance, a modern working environment, career growth opportunities for its employees. Secondly, international experience acquired by employees while working in Global Business Service companies increases the added value of Latvian employees. Third, Latvia’s higher education system is being built in a way that is allowing students to compete internationally. Global Business Services representatives have met with representatives of higher education institutes to discuss the integration of the necessary skills into the Global Business Service industry already in the study process with methods such as case studies, bachelor’s works in the field of Global Business Services, guest lectures and others.

Latvia’s success in the Global Business Services sector has already gained international recognition. During the CEE Shared Services & Outsourcing Summit & Awards 2019, Latvia won several nominations. Riga City won the title “The Rising Global Service Sector Centre in Europe”. The Tele2 Shared Service Center Latvia nominated the “Social Company of the Year” for its campaign, which inspired women to improve themselves in the IT field. Meanwhile, Cognizant Latvia, part of the international company Cognizant, was founded in India and entered Latvia in 2018, currently employing 300 IT specialists, won the title “The digital services company of the year”.

The Circle K Business Center, which won the nomination “Global Business Services Company in the Baltic of the Year”, is currently the largest international service center in Latvia.

Currently, the Investment and Development Agency of Latvia is actively working with representatives of this perspective sector, inviting them to expand their administrative departments in Riga. The received ratings and nominations so far show that Latvia has a high potential for developing the Global Business Services sector, providing an attractive industry operating environment for already existing and new companies.

In total, there are around 50 global service centres are currently in Latvia, such as the Tieto Global Shared Service Centre, Tele2 Billing, Atea Global Services, Circle K Business Center and others. Administrative services centres in Latvia most often provide services such as IT finance, customer service, logistics, personnel management.

One of the most recognizable centers of Global Business Service in Latvia is currently SEB Global Services, where approximately 700 people are employed. The Centre in Riga provides a number of functions – handling all payments by SEB Group, processing of financial instruments such as shares, bonds. As well as in Latvia, the various financial processes offered by SEB Grupa are being examined whether the customers have received payments or the depositary has entered the required account. In addition, the SEB Group Business Service Office in Riga regulates if the international control requirements are met in money laundering, risk management, provision of IT systems. It should be stressed that SEB Group is the largest and most valuable bank in Scandinavia, and therefore the business services center in Riga plays an important role.

Cabot Corporation is the leading company in the world, specializing in solutions related to various chemicals and materials, in cooperation with the transport, infrastructure, environmental sectors. The Cabot Latvia Business Service Centre manages administrative tasks such as customer support, data management, digital support, accounting services, and others. After 5 years of successful activity in Riga, the number of service center employees was increased by half to boost the growth of Cabot Corporation.[12]

Chinese businessmen have also shown an active interest in expanding their activities in Latvia. Company “BGI” has officially launched new research, development, and production center in Riga to create a Chinese-European life science innovation center. The company has already set up three research, development, and production centers in China — Sheng, Shaun, and Qingdao — and San Jose, U.S. The new 7000 m² large “BGI” center is located at the airport park in Riga. The company based its decision of building its expansion in Riga primarily due to the geographical reasons because MGI is planning to export its production to Europe, Africa, and Eastern countries.

At the premises of “BGI Latvia” in Riga, a product production center, a high-throughput sequencing center, training, as well as a logistics center will be provided. The company’s role here is to strengthen innovation-related cooperation between China and Europe in the fields of life sciences research, industrial use, and technical standards. This means that cooperation on transnational genomics projects, as well as the exchange of experience and information between companies in China and Europe, will continue through this center.[13]

“Given current biotechnology bases in Latvia, “BGI” feels safe when creating a gene-based life-sciences innovation platform in Europe. Here we will be using the company’s main products and technologies. This will help to advance the equipment needed to research higher-level life sciences in China on the global market by creating a system of technical support and a product supply chain that would meet customers’ needs and allow a deeper understanding of the European market, says “BGI” President Duncan Yu.

Thus, Latvia and Riga have always been and is open to creating new, dynamic and well-rewarded jobs, which is exactly what the global service sector gives our state.

[1]https://www.la.lv/strauji-augosi-but-unknowable

[2]Association of Business Service Leaders in Latvia

[3]UAA

[4]Association of Business Service Leaders in Latvia

[5]https://www.atkearney.com/digital-transformation/gsli/2019-full-report

[6]https://ec.europa.eu/eurostat/statistics-explained/index.php/Wages_and_labour_costs

[7]https://ec.europa.eu/eurostat/statistics-explained/index.php/Comparative_price_levels_of_consumer_goods_and_services

[8]https://ec.europa.eu/eurostat/news/themes-in-the-spotlight/price-levels-2018

[9]https://ec.europa.eu/eurostat/statistics-explained/index.php/Foreign_language_skills_statistics

[10]Association of Business Service Leaders in Latvia

[11]Research on employed staff cost and foreign language skills in most competitive sectors of economy in Latvia by “Institute of Economics of the Latvian Academy of Sciences and CREATURA”

[12]Association of Business Service Leaders in Latvia

[13] https://labsoflatvia.com/aktuali/mgi-centrs-riga

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

Latvia economy briefing: A Preview of Latvian Economic Development in 2020

During the last years, Latvia has been experiencing stable economic growth annually. Currently, this has been the longest period of economic development after the renewal of the independence of the Republic of Latvia. However, it has been forecasted that because of the global trends, the pace of Latvia’s economic growth will experience a slowdown in 2020. Data from the Bank of Latvia shows that in 2020 the Gross domestic product (GDP) will grow for around 2.6 percent. Even though the percentage of increase in GDP is more significant than the average in the European Union[1], there is still room to grow for Latvia in order to balance out the inequality level of welfare in comparison to the European Union.

The possible slowdown of economics in Latvia in 2020 can be explained due to several reasons. The main factor in the decrease in GDP growth is the global market and external political events. The development of Latvia’s Baltic trade partners – Lithuania and Estonia – economy will experience a lower rise than in previous years. Since the predictions of the economic growth of the leading trade partners of Latvia are cut down, it can have a direct impact on the number of exports in Latvia, thus affecting the GPD growth in Latvia. Undoubtedly, since Latvia is a small economy, the unpredictable global political situations such as Brexit, China-USA trade policy, etc. play a significant role in the further economic development of Latvia. The growth of exports in Latvia is predicted to be relatively low in 2020. However, it is foreseen that during the second half of the year the total exports will deliver better results.

In the latest years, lack of labor has been one of the main issues for entrepreneurs in Latvia. There have been massive debates over the attraction of the workforce from neighbor countries. However, in the latest months, Latvian enterprises have noted that it is no longer a limiting factor for the development of businesses as it used to be. Therefore, the import of foreign labor will not be as pressing in 2020 as it was previously. Since the level of unemployment among people of working age are higher in some regions in Latvia, there is a possibility to optimize current human resources in Latvia.

The hourly wage in 2020 will experience growth. However, because of the decrement on the pace of economic growth, it has been forecasted that the salaries would not increase as fast as they used to in the previous years. In the main trade fields of Latvia, the average rise in salaries is predicted to be around 6%.[2] The growth of price levels is expected to be 2.4% in 2020. [3] Since the earnings of labor will increase more than the average price levels, it has been foreseen that customers will experience the growth of purchasing power and will be able to purchase more as they used to therefore promoting the level of welfare in Latvia.

It is expected that consumers will have to spend a larger amount of money on such items as fuel, public transport tickets, post services, and administrative services. The main reason for the price increase is new excise duties that will come in force in 2020. However, consumers will have to pay less money on services such as gas and electricity.

In the year 2020, some of the major participants in the field of Latvia’s economy will experience challenges others – success. Because of the planned investments in fields of transport infrastructure as well as regional natural gas, it is predicted to have a positive impact on the economics of Latvia. The investments would allow using tools such as storage and transport infrastructure of natural gas in a more efficient way. By that, it is expected that the enterprises of the industry will have a higher turnover than in the previous years. The development of the construction industry is expected in 2020 as well. However, at the same time, there are still too many unpredictable variables in the transport industry, particularly regarding the implementation of the Rail Baltic project. Rail Baltica is a rail transport infrastructure project with a goal to integrate the Baltic States in the European rail network. The project includes five European Union countries – Poland, Lithuania, Latvia, Estonia, and, indirectly, also Finland. It will connect Helsinki, Tallinn, Pärnu, Riga, Panevežys, Kaunas, Vilnius, Warsaw. Rail Baltic is currently the most significant project in the transport industry in Baltics. The implementation of Rail Baltic project will bring many benefits for the Baltic countries. Firstly, Rail Baltica will be a powerful catalyst for sustainable economic growth in the Baltic States contributing to each countries GDP in various ways. Secondly, the Rail Baltica project will provide with environmentally friendly sustainable infrastructure by reducing the environmental footprint on human mobility. And Third, Rail Baltica will create new opportunities for multimodal freight logistics development. Because of the many benefits of Rail Baltica and its impact on Baltic countries, Rail Baltic is one of the most significant projects in the Baltic States.

It is also expected that the manufacturing sector will deliver lower results as previously. For example, the current price levels of timber interfere with the development woodworking field, which has a significant role in the economics of Latvia since timber and other related products are the primary goods of export in Latvia. Because of the high competition for customers and downgrade of revenue level in the banking sector, it is expected that for the finance sector, the Year 2020 can be seen as challenging. However, not all industries are expected to face difficult times. The increase in investments in the food processing industry in Latvia might open a new direction for exports in Latvia.

In the upcoming months, the total development of investments is predicted to shrink. The peak of investments from the European Union was reached in the previous decade, and there are no expectations on new significant investments from the European Union. However, there will be further investment projects regarding Rail Baltic that will improve the investment environment in Latvia.

Because of the use of European Union funds and the lack of substantial private construction projects, it can be possible that the construction industry will be affected negatively. It has been foreseen that the total turnover levels of the construction sector will remain the same as in 2019. The construction field in Latvia has reached its top both in Latvia and as well in Eurozone. It is worth noting that there is no reason to expect a crisis in the sector. The demand still exists. However, the question of whether the construction sector will adapt to the new costs remains open. In all, the construction industry could experience a 1-3% fall. That is mainly explainable due to the government’s policy to cut the total amount of investments.

The analytical division of the Ministry of Economics of Latvia stressed that in 2020 the exports of the service sector industry are expected to grow in particular accommodation services and the Information Technology sector. Besides, a steady rise is expected as well in sectors regarding private expenses and inner market-oriented fields as retail and commercial services. However, because of the global economic situation, it will be harder for those industries which are more focused on exports of goods. It is worth noting that the development of trade will continue. However, it is expected to be at a slower pace than previously in 2020, and in some sectors, the overall demand may fall. In some economic fields in Latvia, lack of demand is foreseen to be one of the primary limiting factors. Mainly the reduction of demand will be seen in the woodworking sector. Despite that, it is expected that the strength and importance of the woodworking industry will remain and it will continue to be the leading commercial industry in Latvia.

Conclusion

Despite the forecast that in 2020 Latvia will experience economic growth, the development of various industries will be different. In some fields, entrepreneurs and politicians will have to face challenges and come up with new strategies. However, since currently, Latvia’s economy can be described as stable and balanced, and because of that Latvia will be able to avoid potential risks the global economic trends may have caused. The total growth of GDP is expected to reach around 2.6%. It is foreseen that the pace of exports and in-flow of investments such as European Union funds will slow down. At the same time, the worker-friendly labor market, as well as the moderate inflation will show steady growth in private consumption and will be one of the main factors that will contribute to the economic and welfare growth of Latvia. As for the latest years the Information and Technology industry will keep expanding and have a bigger share on the total GDP.

[1] https://ec.europa.eu/eurostat/databrowser/view/tec00115/default/table?lang=en

[2] Bank of Latvia

[3] Bank of Latvia

*This article has been made in cooperation with China-CEE institute and is the intelectual property of China-CEE institute

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