On Thursday, January 14, the third meeting of Prime Minister Valdis Dombrovskis and High Level Advisory Group to the Prime Minister of the Republic of Latvia was held at the Cabinet of Ministers.
The participants of the meeting were introduced to the presentation by the Ministry of Economy and the report of Prime Minister Valdis Dombrovskis on the current macroeconomic situation, as well as projected economic trends and policy instruments, which will be used to stimulate economic recovery.
The participants of the meeting welcomed the current measures for improvement of business environment. The experts emphasized that it is important to define a single medium-term national development vision in order to restore economic growth. It was also stressed that it is essential to implement the existing plans to attain the long-term development vision. The members of the group advised to use the investments for the development of vocational education as well as education of unemployed people on issues of business start-ups as additional economic incentive measures.
As for reductions in spending, the experts recommended to focus on outsourcing in order to improve the cost-effectiveness. In the social sector - to improve re-allocation of social assistance to those social groups who need it most. During the discussion the Prime Minister stressed that the most important task at present moment is to change from crisis management to implementation of medium-term development goals.
As for the support to the economy, the Prime Minister and experts of the group discussed the most appropriate criteria which should be applied for reallocation of various EU and national support instruments in the economy.
The group members shared their international experience, mentioning that the development of a stable business climate in the country, as well as the support to various businesses based on such factors as their efficiency, innovations and value-added is more important than the financial support.
In order to identify the comparative advantages of the country, the experts advised to mark also the strategic sectors of the economy ensuring that the remaining sectors are not in any way discriminated in process of re-allocation of financial resources and diminishing of administrative barriers. The group members also discussed various mechanisms how the green economy could contribute to the development and decline of gray economy.
Discussing the availability of financial resources - the experts shared their experiences on the factors that make countries attractive destination for foreign direct investments mentioning the stability and predictability, as well as skilled labor force and its productivity as the main factors.
A number of versions and views were voiced at the meeting on the foreign investors’ point of view on such comparative advantages of Latvia as strategic location, access to both, markets of the European and former Soviet bloc countries, broad language skills of the population, etc.
The experts commented that the planned accession to the euro zone later than it is intended by other Baltic countries cannot become a decisive factor for making investment decisions. It is more important to ensure fiscal consolidation and further progress towards a stable and predictable economic development.
The experts expressed their positive assessment of the achieved fiscal consolidation, since it is an important factor for stabilization of the economy.
As for the issue of monitoring and evaluation of competitiveness the experts stressed that a dialogue with entrepreneurs on the necessary measures and tasks of the Government to increase competitiveness is important in achieving growth of national economy.
The Prime Minister mentioned that there is a dialogue with government members in Latvia, however, no regular and independent assessment of country's international competitiveness is carried out. The experts mentioned Ireland as a positive example where the Competitiveness Council carries out annual assessment of competitiveness based on such leading competitiveness indexes as Doing Business and WEF index.
The meeting of the High Level Advisory Group was attended by the following internationally recognized experts - Christian H. M. Ketels, representative of the Stockholm School of Economics, Harvard University Institute for Strategy and Competitiveness (Sweden); Frank Barry, senior lecturer of the Trinity College Dublin, School of Business (Ireland), Gundars Ostrovskis, representative of the Lisbon Strategy Coordination and Economic Reforms Unit, European Commission (Belgium), Hans Enocson, Honorary Chair of the Foreign Investors Council in Latvia (Sweden), Ken Warwick, director of the Department of Business, Innovations and Skills, Cabinet Office (United Kingdom), Richard Bisanz, freelance consultant of the Polish Information and Foreign Investment Agency (Austria, Poland).
The High Level Advisory Group brings together internationally recognized experts who advise the Latvian government on the solutions to crisis and the national development vision. It was created on the initiative of V.Dombrovskis in May, this year. The politicians, financial experts, economists, experts of the banking sector and academicians who are highly recognized in Europe work in the Advisory Group in their personal capacity and without remuneration.
The photos of the meeting of Prime Minister Valdis Dombrovskis and High Level Advisory Group are available in the Internet photo album of the State Chancellery: http://www.flickr.com/photos/valstskanceleja/sets/72157623082913721/
Laine Kučinska
Deputy Head
Communication Department
State Chancellery
Phone: 67082905 / 29457329
E-mail: Laine.Kucinska@mk.gov.lv
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