H E Mr Alberts Sarkanis Ambassador to the
H. E. Mr. Alberts Sarkanis, Ambassador to the Czech Republic Business Environment in Latvia 12. 04. 2017 Prague
Latvia in facts § § § Source: Central Statistical Bureau of Latvia Capital: Riga Area: 64 589 km 2 Population: 1, 95 million (2017) Official language: Latvian Dominant foreign languages: Russian, English and German Currency: Euro (€) Total national border length: 1862 km Length of Latvia’s coastline: 494 km Agricultural land: 18 850 km 2 (2015) Forest land: 35 750 km 2 (2014) Major ports: Riga, Ventspils, Liepaja Business Environment in Latvia 2
International memberships § European Union (2004) > Eurozone (2014) § United Nations (1991) § North Atlantic Treaty Organization (2004) § Organization for Security and Co-operation in Europe (1991) § World Trade Organization (1999) § Organisation for Economic Co-operation and Development (2016) Business Environment in Latvia 4
Macroeconomic indicators Business Environment in Latvia 5
Gross domestic product (GDP) GDP (growth at constant prices, %) GDP (at current prices, billion EUR) 3. 5 30 25 20 20. 24 21. 81 22. 76 23. 58 24. 37 25. 02 3. 4 3. 2 3. 0 2. 7 17. 92 2. 5 15 2. 4 10 2. 0 5 1. 5 0 2011 2012 2013 2014 2015 2016 2017 * 2018 * * Forecast of the Ministry of Finance Source: Central Statistical Bureau of Latvia Business Environment in Latvia 6
Monthly wage and employment 2013 2014 2015 2016 2017 * 2018 * Monthly wage Average monthly wage of the employed in the economy, EUR Growth at current prices, % 716 765 818 859 910 1013 4. 5 6. 8 5. 0 5. 5 Employment, thousands 894 885 896 893. 3 900 901 Growth, % 2. 1 -1. 0 1. 3 - 0. 3 0. 2 0. 1 Unemployment rate, % 11. 9 10. 8 9. 9 9. 6 8. 4 8. 0 * Forecast Source: Ministry of Finance Republic of Latvia Business Environment in Latvia 7
Foreign direct investments Business Environment in Latvia 8
Foreign direct investments in Latvia (FDI) FDI (billion EUR) Top 5 countries by FDI in Latvia (million EUR, 2016 Q 4) 16 13. 36 13. 52 14 12 10 11. 57 12. 08 Sweden 2120 9. 36 10. 26 Russia 1320 8 Cyprus 6 1310 4 The Netherlands 2 982 0 Estonia 2011 Source: Bank of Latvia 2012 2013 2014 2015 2016 937 Business Environment in Latvia 9
Foreign trade Business Environment in Latvia 10
Exports and imports of goods (billion EUR) Import 12. 51 10. 98 9. 88 12. 64 10. 02 Export 12. 65 10. 02 12. 53 10. 4 12. 28 10. 33 8. 54 2011 Source: Central Statistical Bureau of Latvia 2012 2013 2014 2015 2016 Business Environment in Latvia 11
The main export and import partners of goods (million EUR, % 2015) Export Lithuania 1967. 31 (18. 97%) Estonia 1203. 65 (11. 61%) Russia 833. 98 (8. 04%) Germany 6673. 64 (6. 50%) Poland 625. 80 (6. 03%) Source: Central Statistical Bureau of Latvia Import Lithuania 2170. 10 (17. 31%) Germany 1411. 53 (11. 26%) Poland 1390. 80 (11. 09%) Russia 1075. 92 (8. 58%) Estonia 948. 74 (7. 57%) Business Environment in Latvia 12
Exports and imports of services (billion EUR) Export 1. 99 2011 Source: Bank of Latvia 3. 90 3. 77 3. 47 Import 2. 15 2012 4. 04 3. 85 2. 13 2013 2. 11 2014 2. 28 2015 Business Environment in Latvia 13
The main export and import partners of services (million EUR, % 2015) Export Import The United Kingdom Lithuania 388. 25 (9. 61 %) 245. 99 (10. 80%) Switzerland Germany 366. 77 (9. 07%) 143. 30 (6. 29%) Russia The United Kingdom 349. 72 (8. 65%) 136. 62 (6. 00%) Lithuania Estonia 263. 74 (6. 50%) 99. 59 (4. 37%) Sweden Ireland 210. 70 (5. 21%) 93. 29 (4. 10%) Business Environment in Latvia 14
Latvia’s credit ratings 2017 The Fitch Ratings Moody’s Standard & Poor’s R&I Rating A- A 3 A- BBB + Outlook Stable Source: Public Finance Management Business Environment in Latvia 15
Investment environment in Latvia Business Environment in Latvia 16
Infrastructure § An extensive and functional road network, connecting both European and CIS road networks, as well as Latvia’s ports; § Free ports in Ventspils, Riga and Liepaja; § The shortest route between the EU and the CIS; § Riga International Airport as a fast-growing airport provides a competitive international passenger hub, and a high-speed cargo distribution centre; Source: Investment and Development Agency of Latvia Business Environment in Latvia 17
Skilled and motivated workforce § The labour force in Latvia is well educated, with one of the highest rates of university attendance in the world; § 36 institutions of higher education, 3 of which are branches of foreign universities; § There are more than 5700 students studying in higher education programs for engineering, electronics and metalworking; § Latvia’s history has prepared its workforce with knowledge of business and cultural norms that enable partnership particularly with Russia and other CIS partners, as well as with western European countries; Source: Investment and Development Agency of Latvia Business Environment in Latvia 18
Tax system in Latvia Tax system in 2017 1 25% 23% 20% 24% 15% 21% 15% 10% 11% 12% 5% 0% ax al son r e P e. T com In e orat p r o C Source: 1. Ministry of Finance Republic of Latvia 2. Pricewaterhouse. Coopers - Pw. C me Inco Tax E rs oye l p m ial Soc Tax e E oye mpl ial Soc Tax T VA ise erpr tax ent ro Mic Latvia’s total tax rate of 35, 9% for businesses is the lowest of the Baltic States and the 12 th lowest of the EU and EFTA region. 2 Business Environment in Latvia 19
Special economic zones in Latvia Source: Investment and Development Agency of Latvia Business Environment in Latvia 20
Transport infrastructure in Latvia Business Environment in Latvia 21
Key elements of transport infrastructure Source: Ministry of Transport of Republic of Latvia Business Environment in Latvia 22
Cargoes loaded and unloaded at Latvia’s ports Cargoes loaded and unloaded (million t) 60 61. 03 66. 13 62. 35 65. 05 62. 55 40 20 0 Loaded 7. 79 2011 9. 06 2012 2013 Cargoes loaded at Latvia's ports 2015 7% 2% 33% 57% Source: Central Statistical Bureau of Latvia 9. 12 8. 13 Freeport of Riga Freeport of Ventspils Port of Liepaja Other Ports 2014 7. 09 Unloaded 2015 Cargoes unloaded at Latvia's ports 2015 13% 24% 4% 58% Freeport of Riga Freeport of Ventspils Port of Liepaja Other Ports Business Environment in Latvia 23
Latvian railway infrastructure § § Total length of lines – 1859 km Total length of 1520 mm gauge lines – 1826 km Length of electrified lines – 248 km 152 stations Source: Latvijas dzelzceļš (Latvian Railways) Business Environment in Latvia 24
Rail freight transportation in the Baltic States (million t) 59. 4 55. 8 60. 6 57. 0 55. 6 49. 2 70 48. 7 60 48. 0 49. 4 52. 3 49. 0 48. 0 50 40 30 29. 6 30. 5 26. 1 24. 4 20 19. 2 15. 4 10 Lithuania 0 2010 Latvia 2011 2012 Estonia Source: Latvijas dzelzceļš (Latvian Railways) 2013 Lithuania 2014 Estonia 2015 Latvia Business Environment in Latvia 25
Rail Baltica – Railway line from Tallinn to Berlin Source: Ministry of Transport of Republic of Latvia Business Environment in Latvia 26
Contact information: Embassy of the Republic of Latvia Hradešínská 3 , 101 00 Praha 10 T. + 420 255 700 881 embassy. czech@mfa. gov. lv Detailed information online: • • Ministry of Economics www. em. gov. lv Ministry of Finance www. fm. gov. lv Bank of Latvia www. bank. lv Investment and Development Agency of Latvia www. liaa. gov. lv Business Environment in Latvia 27
- Slides: 26