Friday, 9 September, the representatives of the government and ministries met with representatives of the Foreign Investors’ Council in Latvia (FICIL) at the Cabinet of Ministers of Latvia and agreed on the priority areas to improve the country's competitiveness on the global market and make the business environment in Latvia more attractive for entrepreneurs. The participants of the High Council meeting set out the relevant targets, such as the promotion of energy independence, the fight against shadow economy and digitisation of the public sector to accelerate and improve the exchange of data between institutions.
“In a situation, where Russia’s brutal war in Ukraine continues, we in Latvia have to do everything so that we still have a good environment in which everyone can live, work and invest. I would like to emphasise that Latvia is a safe country and we will do our utmost to ensure that it remains safe also in the future. The availability of energy resources and their price is the greatest challenge confronting us today. It is important to note that the government has a plan and concrete action how we will, first of all, get through this winter and what we will do in the coming years. In the context of the upcoming heating season, the government has taken the necessary decisions to make energy resources available, particularly natural gas, and has adopted a broad support package for both citizens and businesses. The government has also made a decision to strengthen energy independence in the medium-term by developing wind parks – both through the Latvian–Estonian joint project Elwind and the new project, which will be implemented by the joint venture set up by Latvenergo and Latvia’s State Forests to develop wind parks. The government has also decided on setting up a liquefied gas terminal in Skulte, and we are currently waiting for the Ministry of Economics to submit a relevant draft law to the government, which will result in our own LNG terminal being connected to Inčukalns underground gas storage. Latvia will increase electricity generation capacity in the country in the medium-term and become an electricity exporter, which is also an essential condition for improving the business environment and attracting foreign investment,” stressed Prime Minister Krišjānis Kariņš.
The parties also agreed on the need to make an in-depth evaluation of the public sector’s structure to more effectively introduce, for instance, the green initiatives and digitalization. Human capital is also a prerequisite for long-term economic growth; therefore, the opportunities for retraining and further training of employees should be developed and closely linked to future market needs. That would also make easier for entrepreneurs to attract labour. To this end, a centralised human capital management is required.
Zlata Elksniņa Zaščirinska, Chairperson of the FICIL Executive Board: “We have to be capable to address simultaneously persistent challenges and crisis situations, otherwise a number of issues related to the availability of human capital, public sector reform, combating the shadow economy have not been addressed effectively for years. The main issues arising from a fragmented structure of the public administration relate to specific functions to be performed by different institutions, both at national and local level. Latvia, like other EU countries, is ahead of various challenges over the coming decades, which will require numerous reforms in the country. Both energy independence and workforce related challenges, implementation of the Green Deal, and the fight against shadow economy can be addressed more effectively by focusing on specific results with particular responsibility for each topic.”
The participants of the meeting shared the view that it is essential to increase the foreign investors’ confidence, providing a predictable and stable business environment by strengthening the rule of law, the quality of legislation and judicial efficiency. Specialisation of the courts by improving accessibility and digital capacity of the courts also plays an important role.
As part of the meeting, FICIL submitted nine position papers to the Cabinet of Ministers for further evaluation, with proposals and recommendations on energy independence and security, the circular economy, data, labour-related challenges, judicial efficiency, fair competition and investment protection, fighting the shadow economy, the EU Green Deal, the Strategy of Latvia, the quality of public sector reforms and legislation.
This was already the 26th High Council Meeting between the government of Latvia and FICIL. Meetings have been taking place since 1999, with the aim of ensuring a structured exchange of information and views between investors and local policy-makers to improve the business environment and facilitate the inflow of foreign investment into Latvia. Ministers, high-level officials, and managers of FICIL member companies participate in the annual meetings of the Latvian government and FICIL. The next high-level meeting of the Cabinet of Ministers of the Republic of Latvia and FICIL will take place in autumn 2023.
Foreign Investors' Council
FICIL is a non-governmental organization that unites the largest foreign companies from various industries, foreign chambers of commerce, and the Riga School of Economics (SSE Riga). FICIL's mission is to improve Latvia's business environment and competitiveness in attracting foreign investment, making use of the experience and knowledge of its members in order to provide recommendations to the government.