On Friday, September 16, Prime Minister Valdis Dombrovskis hosted the Prime Minister of Finland Jyrki Katainen, who has arrived for his first visit to Latvia since assuming the post of the Head of Government. J.Katainen is attending the annual Rīga Conference and together with the Head of the Government of Latvia delivered a lecture in the Riga Technical University on the Finland’s experience in the area of innovations and education reform.
The Heads of Government of Latvia and Finland exchanged opinions on the situation in the Eurozone and future outlooks as well as on next European Union’s multi-annual budget perspective for 2014-2020.
V. Dombrovskis particularly stressed that Latvia does not support the proposal of the European Commission to limit funding for the Cohesion Policy to 2.5% of GDP. “Such an approach of setting linear ceiling contradicts the regional development objectives. Latvia’s priority is to achieve sufficiently large funding,” said V. Dombrovskis.
The Head of Government of Latvia also drew attention to Latvia’s position regarding the Common Agricultural Policy (CAP) where it is necessary to achieve fair and equal conditions of competition for the Latvian farmers in the common European market. “The payments for the Latvian framers should be in the amount of at least 200 euros per hectare,” said V. Dombrovskis. J. Katainen expressed his position that the support to farmers in the European Union is one of the priorities of cooperation between Latvia and Finland.
During the negotiations, the sides discussed cooperation in the area of transport as well as customs issues. V.Dombrovskis stressed the importance of integrating and developing the transport network of Latvia and the Baltic region in the north-south direction and in transport corridors which are necessary for port logistics.
V. Dombrovskis informed about current developments in the area of energy in the Baltic countries, providing the reasons why the establishment of a regional gas terminal is the best solution how to improve energy supply in the Baltic countries and that Latvia is a better place for terminal development.
Prime Minister of Finland J. Katainen mentioned the EU Sulphur Directive, which is currently under development and provides for gradual reduction of sulphur content, as an important issue of cooperation. J. Katainen expressed the view that this is a positive initiative, however, it may increase transport costs in the Baltic countries an there is a need to assess its impact at the time of economic difficulties.
J. Katainen appreciated the accomplishments of the Latvian society and the government during the last two years and expressed the position that Latvia has chosen the most proper way to overcome the financial and economic difficulties.
The Heads of Government of Latvia and Finland discussed the cooperation between entrepreneurs of Latvia and Finland. J.Katainen emphasized that currently 300 Finnish companies are operating in Latvia which confirms the importance of the Latvian market and close economic ties of the two countries.
In the public lecture “Knowledge and Talents – the Finland’s Experience and Latvia’s Opportunities” that was held before the meeting, V.Dombrovskis and J.Katainen compared the Finland’s and Latvia’s experience of overcoming the economic crises. Both Prime Ministers agreed that the national development is based on an educated society and innovations which are focused on long-term development. “The Finnish education system is one of the best in the world, because the development of education and innovations has been its priority for many years,” said Prime Minister of Finland J.Katainen. He emphasized that, to a great extent, investment in education, research and innovations caused economic recovery of Finland after the crisis in 2008 when the country’s GDP had fallen to 8%.
“There is a challenge in structural changes which come along with crisis; however, it is relatively easy for small countries like Finland and Latvia to adapt to changes,” said the Prime Minister of Finland. He stressed that at the time of changes it is particularly important to seek new opportunities for cooperation, incl., between government institutions and entrepreneurs to take steps towards dynamic development of innovations and research and, thus, towards economic recovery.
Today, the Prime Minister of Latvia participates in the Rīga Conference and together with the Prime Ministers of Lithuania, Estonia, Finland and Poland will discuss the economic growth at the time of overcoming the economic crisis as well as security in the European Union and NATO space.
Economic cooperation between Latvia and Finland
By the end of 2010, Finland was Latvia’s 9th largest export and 6th largest import partner. Latvia’s main export goods to Finland are timber and timber products while the main imports from Finland are mineral products, cars, mechanisms and electronic devices. In the field of service export, at the end of last year Finland was 9th largest service export and 8th largest service import partner. In the year 2010, Latvia’s services for foreign trade with Finland were mainly shipment and tourism.
According to the statistics of the Bank of Latvia, Finland’s accumulated direct investments by the end of the first half of 2011 amounted to LVL 266.4 million. By the end of 2010, investments were mostly accumulated with real estate operations, in manufacturing industry and commerce. Latvia’s accumulated direct investments in Finland by the end of the first half of 2011 amounted to LVL 3.8 million.
By investments in fixed capital of companies registered in Latvia Finland ranks 11th with total investments of LVL 153 million. According to the data by Lursoft, 357 companies are operating with funding of Finland. Finland’s largest investors are YIT Construction Ltd. with investments in company YIT Celtniecība Ltd and Olvi Ovi with investments in JSC Cēsu alus.
Photo of the meeting: http://www.flickr.com/photos/valstskanceleja/sets/72157627558012887/
Audio file of the press conference of the Heads of Government of Latvia and Finland: http://filesocial.com/cd0kxgj
Information prepared by:
Press Secretary to the Cabinet of Ministers
Press Secretary to the Prime Minister
Phone: 67082865 / 26556965