Finance Minister Arvils Asheradens believes that, all things considered, foreign investors’ valuation remains relatively good. Ascheradens pointed to a number of factors affecting the economy – the European Central Bank’s (ECB) ongoing fight once morest inflation, banks’ very conservative lending policies, as well as the security situation that needs to be addressed urgently.
According to the minister, the economy cannot develop normally with such high interest rates. The minister also pointed to weak lending, as there is currently an investment deficit of between two and five billion euros in the Latvian economy. According to Asheradens, the financing and investment gap can be solved by developing the capital market.
The Finance Minister also acknowledged that bureaucratic procedures are hindering targeted progress in implementing government strategies.
He added that the basic principles of a tax policy more favorable to business will be ready in June. The reform of the State Revenue Service and work to introduce universal income declaration are also progressing, which will help combat the shadow economy.
Economy Minister Viktor Valainis said that the assessment of foreign investors should be taken seriously.
Valainis noted that in Latvia there is a shortage of labor for business development – entrepreneurs have orders, but cannot fulfill them due to a lack of workers.
Valainis also acknowledged the impact of the bureaucratic process in construction, adding that work to reduce bureaucracy is already underway. The minimum goal is to reduce construction time by 30%, and ideally by 70%, Valainis said.
The economy minister also pointed out the underdevelopment of the capital market, which currently accounts for regarding 1% of gross domestic product (GDP). “In order for the economy to start moving, it is necessary to develop the capital market,” Valainis said.
Transport Minister Kaspars Briskens acknowledged that infrastructure received a poor rating from investors and agreed that Latvia has not invested enough in the development of railways, ports and especially roads, which create the connections businesses need between industrial parks, ports and other facilities.
At the same time, Brishkens noted that Latvia is the leader in the Baltics in aviation, and the communication infrastructure in all three countries is approximately at the same level.
According to the study “Foreign Investment Climate Index 2023” conducted by the Riga School of Economics and SIIL, the investment climate in Latvia in 2023 received the lowest score in history – 1.9 points out of five.
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2024-04-26 19:14:07
