bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Friday 24.03.2017 | Name days: Kazimirs, Izidors
LatviaLatvia

Economic Diary of Latvia. Everyone is dancing, or sirtaki for the EU

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUIt would be unfortunate to start off with a trivial ‘We told you so’, but it seems there is no other way: on 16 July the Greek parliament approved the measures necessary for international creditors to permit the realization of a new bailout plan. This means Greece desperately wants to receive the EUR 86 billion, and Latvia will not be able to sit this one out.

Debates in the Greek parliament continued for more than four hours. In the end, 229 deputies out of 300 voted in favour of measures. With that, the Greek parliament has agreed to, among other things, to increase VAT in a number of sectors and the pension system.

After such a vote, the south European country has paved the way for European structures to make the decision to allocate funds necessary for the restoration of work of Greek banks and the cover of the debt of EUR 3.5 billion Greece has before the European Central Bank on 20 July. The EU plans to a loan of EUR 7 billion to Greece. This will allow the country cover its immediate financial needs during the transition period prior to the adoption of the new bailout plan. The country needs a total of EUR 86 billion to resolve its problems. Talks about allocating this amount will take around one month.

If the third bailout plan for Greece is approved, Latvia will have to guarantee up to EUR 240 million, said Bank of Latvia advisor Andris Strazds this week. And even though only part of this amount will have to be provided and the other part will serve as guarantee, it will nonetheless increase Latvia external debt. Strazds said he does not believe Greece will even return the money it has borrowed over the years. ‘We risk the money of our taxpayers,’ – he said.

He added that the size of financial assistance to Greece has grown considerably over the past several weeks because of absurd actions of this country’s government: from a dozen billion euros to nearly a hundred million euros. As the Finance Ministry explained it, the aforementioned EUR 240 million will be taken from the Latvian budget only if Greece fails to return the loan.

Does anyone in the world truly believe Greeks plan to return at least part of the debt?

And even though both Governor of the Bank of Latvia Ilmars Rimsevics and Finance Minister Janis Reirs, and even Prime Minister Laimdota Straujuma, have been doing their best to convince residents that the Greek crisis will not affect Latvia the slightest, BNN warned multiple times: it will affect Latvia and Eurozone.

What does Iran have to do with anything?

There was another event this week. This one does not seem to have any relation to Latvia at first glance. Nevertheless, it may have serious geopolitical consequences for Latvia as well.

The long-lasting talks between Iran and six major countries – France, UK, Germany, USA, China and Russia – concluded this week. As soon as the agreement has been ratified by the UN and government of countries, it will be possible to talk about the conclusion of the 12-year long dispute with Iran in regard to the country’s nuclear plans. The reached agreement states that Iran will not develop its nuclear programme for military purposes and western countries will gradually lift their sanctions off the country, allowing it to return to the international market.

Iran means oil. The country has the fourth largest oil deposits in the world after Venezuela, Saudi Arabia and Canada. High-quality Iran oil is concentrated in a small region and its collection is cheap. Iranian export could rise to one million barrels in the first year after lifting sanctions. What is more important, international demand for oil can be satisfied completely in 2016 with oil from Iran alone.

Globally this means the appearance of a new player. This will prevent prices from jumping. On the other hand, oil price below USD 60 per barrel will lead to the decline in the extraction of expensive shale oil in USA, which will slightly slow down the shale revolution. For Latvia this means the fuel price will not change much. With that, the prices of goods and services that rely on oil prices will not change much.

Having guarantees is nice

While complicated plans are being executed on the global chess board, Latvian entrepreneurs are not chasing dreams and promises. They do in fact take their responsibilities very seriously. First of all, most of them wish to increase their level of knowledge of foreign languages and improve their marketing skills.

According to results of the recent Citedele Index, 43% of Latvian managers mentioned foreign languages when asked about which skills or knowledge would benefit their employees the most. Increasing knowledge and marketing skills is the second priority for entrepreneurs.

Acquisition of additional knowledge in IT areas (29%) and financial planning (27.5%) are also among the most often mentioned areas for improvement.

According to experience, entrepreneurs, especially young ones, often find it difficult to differentiate between financial flow and calculating revenue/expenses. This is why company managers should consider improving their knowledge and skills in these areas. Small and medium-sized companies are often unable to afford a financier. It is only harder to do business if you don’t know exactly what you’re doing, says member of Citadele Bank’s board Santa Purgaile.

It is also worth mentioning that some entrepreneurs mentioned that they would make use of additional knowledge in bureaucracy, journalism and pedagogy. Motivation and positive thinking also play a major role.

Ref: 017.109.109.5823


Leave a reply

Proportion of HIV-infected tuberculosis patients in Latvia is 17.4% - the highest in EU

The proportion of HIV-infected tuberculosis patients in Latvia is 17.4%, which is the highest not only among Baltic States, but also Europe, as mentioned by Jurijs Perescikovs, director of Disease Prevention and Control Centre’s Infection Risk Analysis Department in a discussion dedicated to the World Tuberculosis Day.

British police names London terrorist

British police has stated that the March 22 terror attack in London was committed by British-born Khalid Masood. Another of his victims has died.

Air temperature in Latvia to remain largely unchanged in coming days

On Friday, 24 March, high atmospheric pressure will remain in the country. Because of that, some clouds will be seen in the sky, wind speed will stay moderate, and air temperature will rise to +3° C…+8° C, as reported by the State Environmental, Geology and Meteorology Centre.

Kucinskis hopes to find a new director for State Chancellery within two weeks

Latvian Prime Minister Maris Kucinskis hopes to find a new manager for the State Chancellery within the next two weeks.

InnoEnergy business opens an office in Latvia

International business accelerator company InnoEnergy has opened an office in Latvia. This objective of this company is preparing new and innovative technologies developers for attraction of investments as part of InnoEnergy accelerator.

Bank of Latvia increases inflation outlook for 2017 to 2.7%

The Bank of Latvia has increased its inflation outlook for 2017 from 1.6% to 2.7%, as reported by the bank’s press-service.

CC permits Lithuanian company to acquire decisive influence over Latvian businesses

Latvia’s Competition Council has permitted two mutually associated deals to be performed by W.P.Carey and Kesko, allowing the two concerns to acquire decisive influence over Lithuanian Baltic Retail Properties and three companies registered in Latvia – K Prof, Polo LS and Daugavkrasts M.

Estonian military transport firm co-operates with leading Norwegian and British companies

Estonian military transport manufacturer Milrem has made a joint product with Norwegian weapon-maker Kongsberg and British remote system producer Qinetiq North America.

Welfare Ministry opposes diverting part of social budget to healthcare

Experts view Finance Ministry’s proposal to divert certain parts of the social budget to pay for certain healthcare services. Welfare Ministry is especially cautious about this proposal.

Saeima agrees to publish names of disciplinary punished judges

Publication of information about disciplinary penalties applied to judges, their names and surnames will no longer be prohibited, as stated by amendments to the Judicial Disciplinary Liability Law supported by the Saeima in the first reading on Thursday, 23 March.

Experts: internet users open up 30% of fraudulent e-mail letters

Cyber criminals are becoming more and more cunning and their fraudulent e-mails – harder and harder to differentiate from real ones. Internet users open up to 30% of fraudulent e-mail letters, explains eScan antivirus developers.

Minister: Latvia supports International Coalition’s fight against Daesh

«The fight of the International Coalition against Daesh has become a very effective instrument to help reduce Daesh military, financial and recruitment capabilities,» said Latvian Foreign Affairs Minister Edgars Rinkevics.

New pulp factory planned in Estonia

Estonian entrepreneurs have envisaged building a high-tech pulp-making plant near the city of Tartu and have submitted the plan for confirmation from Estonian national special planning authorities.

Ventspils Freeport Authority announces procurement

Procurement has been announced for the construction of an access road in Ventspils, Talsu Street 200 and landscaping of nearby territories so that one of the land tenants can commence construction of their building there, as reported by Ventspils Freeport.

Estonian investors consider construction of pulp factory in Latvia

Investors that consider building a pulp factory worth EUR 1 billion in Estonia’s southern region allow for the possibility of getting permission for the same project in Latvia, because this process can take a long time in Estonia.

Russian singer barred from going to Eurovision in Kyiv

Ukrainian authorities have banned Russian Eurovision representative from entering Ukraine, where the pop song contest Eurovision is to be held in May.

Travel passports planned to be introduced in Latvia

Deputies have submitted amendments to the Personal Identification Documents Law, suggesting the adoption of travel passports to avoid situations when people are denied the right to travel freely or participate in elections.

Tragic attack in London

In a tragic attack on civilians and police in London, five people have been killed and no less than 40 injured.

Farmers urge voting in favour of preserving land in the hands of local residents

A letter with a request to support farmers, countryside residents and amendments to the Law on Land Privatisation in Rural Areas has been sent to members of the Saeima.

Officials support Finance Ministry’s proposals for medium-term tax strategy

At the 22 March meeting of the National Economy Council, members of the parliament decided to conceptually support Finance Ministry’s proposals for medium-term tax strategy.

Ameriks received nearly 200,000 euros from fast loan companies in interest pay

Vice-Mayor of Riga Andris Ameriks received income of nearly 200,000 euros in interest pay from fast loan companies 4finance and Mogo last year, according to the declaration for 2016 submitted to the State Revenue Service.

Estonia to reduce availability of plastic bags in shops

Having passed amendments to the Estonian «Packaging Law», the Riigikogu has adopted a plan to reduce the use of plastic bags in the Baltic country over the coming years.

Latvian businesses in Japan to be provided with stable tax payment regime

Latvia businesses working in Japan will be provided with a stable tax payment regime that will not be influenced by amendments to Japan’s tax regulations, as stated in Saeima’s report.

Multiple parties to gather in a single candidate list to compete with Lembergs

Latvian Association of Regions, National Alliance, For Latvia’s Development and Unity will start at municipal elections in Ventspils under a single candidate list, said the leader of this unified list Girts Valdis Kristovskis in an interview to Latvijas Avīze.

Reirs: ministry’s offered tax reform will change nothing for most pensioners

Finance Ministry’s offered tax reform will add only slight changes. Most pensioners will not feel any changes from this reform – neither good, nor bad, said Welfare Minister Janis Reirs in an interview to Rīta panorama.