Latviski English По-русски
Monday 11.12.2017 | Name days: Valdis, Voldemārs, Valdemārs

Economic Diary of Latvia. How to lend money to another and still profit from it

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU«According to results of a recent survey by SKDS, 69.6% of Latvian residents do not support amendments to increase micro-enterprise tax from 9% to 11%,» – says Chairman of Latvian Chamber for Commerce and Industry Janis Endzins.

The representative of the entrepreneurial organizations nonetheless positively views the decision of the National Economy Committee to support amendments aimed to maintain the tax rate at 9% for the first three years of economic activity.

«This may help us fix the mistake made by the last parliament to increase micro-enterprise tax from 9% to 11%,» – comments Janis Endzins.

First arrivals

From January 15th and onward, Citadele bank received more than 800 applications regarding requests to receive mortgage loan with state guarantee, which is provided at beneficial terms and reduced first instalment.

The biggest degree of interest has been noted for housing worth EUR 7,000 to EUR 23,000. Approximately 70% of applications have been received from residents of Riga and Riga region. 30% of applications have been received from residents of other regions, as reported by Citadele Private Crediting Department Baiba Tetina.

As previously reported, Citadele bank is currently the first and only participant of the state support programme aimed to assist Latvian families with children to acquire housing. As part of the state support programme, residents can expect to be provided with funding from banks worth up to 95% of market price of the desired property.

Under circumstances of real estate property becoming more expensive in Latvia, the launch of the programme may prove quite useful. According to Eurostat, Latvia is among leaders in terms of real estate price growth in 2014. Ireland is on the first place (+15%), Estonia is on the second (+13.2%). Latvia, UK and Sweden are on the third (+10.3%).

Lend to someone else and still profit from it

A new project for mutual crediting for private persons – Mintos – has been launched in Latvia. Representatives of the company position themselves as ‘competitive alternative to bank crediting’.

67 loans worth a total of EUR 550,000 have been issued and 150 investors have been attracted, as reported by co-founder of the company Martins Sulte.

This platform has been created in order for private persons to use their funds to invest in loans for other private persons. This is a new thing for Latvia, but USA, China and Europe have been working with such programmes for a long time.

The structure of the platform is simple: the lender has to fill in a form. His solvency is then inspected, as is information from Credit Register. After the in-depth inspection, the company issues a loan from its own funds. Only after all this the company offers residents to perform investments in specific loans. Investors also have the right to re-sell their investments. The minimal investment rate is EUR 10.

If the lender is unable to pay back the money in time or completely halts the payment of interest or the main amount, the company has the right to buy out problematic investments.

The offered rates make the project attractive for investors and lenders. The company is also paid a portion of the money as well.

Latvian enterprises steer clear of innovations

Only 30.4% of Latvian enterprises had performed the introduction of investments over the course of 2010-2012, which is the fourth lowest index in Europe, according to data from Eurostat.

For example: the average index across Europe is 48.9%, in Lithuania – 32.9%, in Estonia – 47.6%.

The leading countries in regard to the proportion of innovative companies are Germany (66.9%), Luxembourg (66.1%) and Ireland (58.7%).

It is worth noting that the proportion of innovative enterprises in the EU has declined from 52.8% to 48.9% in 2008-2010. In Latvia, on the other hand, this proportion has increased from 29.9% to 30.4%.

Information from Eurostat was compiled based on innovative products and processes, as well as marketing and management.

According to a survey by SEB Bank in Baltic States, the number of companies that plan to introduce innovations continues to decline in Latvia and continues to rise in neighbouring republics.

Last year, 48% of enterprises in Latvia had planned to invest in innovations. In reality, only 39% ended up actually investing. Estonia’s indexes were 60% and 73% respectively and those of Lithuania – 42% and 69%.

The majority of companies that plan to introduce innovations work in IT and communications (69%), entertainment (57%), industry and energy (56%) sectors.


Leave a reply

Businessmen: labour force deficit already exists; foreign students should be integrated in labour market

61.2% of businessmen in Latvia already experience problems with finding qualified workers. More than one-fifth of them expect difficulties in the near future. 79.7% of interviewed entrepreneurs said they support the idea of integrating foreign students in Latvia’s labour market, as concluded in data from a survey performed by Latvian Chamber of Commerce and Industry (LCCI), interviewing 225 businessmen.

Commissioner: EC offers support to member states that wish to join Eurozone

European Commission offers additional support to EU member states that wish to join Eurozone, says EC Vice-President for Euro and Social Dialogue Valdis Dombrovskis.

Estonia to continue five school break schedule until 2021

Estonian Ministry of Education and Research has arrived at and published the dates of school breaks for three school years to come and has promised uphold its new system of five breaks instead of the historical schedule of four.

How much does violence against women cost Latvia?

The costs associated with partners’ violence against women in Latvia reach EUR 442 million a year, says Welfare Ministry’s Child and Family Policy Department’s senior expert Viktorija Boļšakova with reference to data from European Institute for Gender Equality (EIGE).

De Facto: company responsible for Rail Baltica project involved in a fraud case

The company owned by the new head of Eiropas Dzelzceļa līnijas Andris Linužs is involved in a criminal process regarding fraud and document forging when receiving state funding for procurement of wind turbines. The committee that picked Linužs for the important post was not aware of this fact, as reported by De Facto programme of LTV.

French salmonella outbreak prompts recall of Lactalis baby milk formula

Baby milk powder producer Lactalis in France has made an international recall of its produce marketed globally under the Milumel, Picot and Celi brands after a salmonella outbreak in France.

Mayor of Riga: New Hanza business quarter to improve city’s development

During his visit to New Hanza business and residence quarter, Chairman of Riga City Council Nils Ušakovs said that every project of this kind improves the quality of life in the city, create new space for apartments and offices, jobs and public-access buildings, as well as pull up the quality of life in surrounding territories.

«European Oscars» dominated by satire drama «The Square»

The awards of the European Film Academy have been given to laureates at a ceremony in Berlin on December 9, where the joint production of Sweden, Germany, France and Denmark «The Square» dominated with six awards.

7.3% less cigarettes exported from Latvia in nine months of 2017

In the first nine months of 2017, roughly 1.9 billion cigarettes were exported from Latvia to other countries, which is 7.3% less when compared with the same period of 2016, according to State Revenue Service’s data compiled on excise goods circulation.

Weather in Latvia to be windy; air temperature to reach +9° C

On Monday, 11 December, air temperature in Latvia will be at -3° C… +2° C. It is expected to be somewhat warmer along the coast, however. Some precipitation will be present, as reported by State Environment, Geology and Meteorology Centre.

Ukrainian police detains Georgian ex-President Saakashvili

Police in Ukraine has over the weekend detained the ex-President of Georgia Mikheil Saakashvili on the same week, when a crowd of his supporters released him from a police vehicle.

Week in Lithuania. Vilnius mayor apologises for poor performance of road services

Vilnius Mayor Remigijus Šimašius has admitted that the road services of the Lithuanian capital city were not efficient enough in their response to the weather conditions, apologising to Vilnius residents for the inconveniences they encountered due to traffic interruptions.

BNN summary of the week: kebab industry’s fears, insiders in anti-corruption bureau, and Latvia’s crumbling roads

BNN offers a summary of this week’s topical news in a variety of categories: Fight; Fear; Opinion; Confusion; Truth.

Farmers Saeima: if Latvia does not ease rules for guest workers, there won’t be any workers

During a meeting of the Food Industry Council, the biggest discussions were raised about the matter regarding the lack of labour force in agriculture and food processing companies. On top of that, farmers are confused over Economy Ministry’s proposed solution, saying that it is too far from reality.

Ex-deputy chief of anti-corruption bureau: I have no doubt the prime minister and president dance to Lembergs’ tune

«For ten year now Aivars Lembergs has been under the ban to perform duties as chairman of Ventspils City Council. And for the same period of time Lembergs and state officials have been ignoring this ban. Environment Protection and Regional Development Minister Kaspars Gerhards, who is responsible for supervising municipalities and is very well-informed of the truce power centre, which, unfortunately, is not Latvian citizens as it is stated in the country’s Constitution, goes to visit Lembergs, not Ventspils. He does that to demonstrate his fealty to the ruler as he would if we lived in the Middle Ages,» says politician from New Conservative Party, councillor of Riga city Council and former deputy chief of Corruption Prevention and Combating Bureau Juta Strīķe.

Average consumer price level up 2.7% in Latvia

During 2017, the average level of consumer prices rose by 2.7 % when compared with last year. Prices of goods grew by 2.7 % and prices of services by 2.9 %.

Updated: MEPs move against allowing phosphates in kebab meat said to endanger massive industry

As the European Parliament plans to vote on vetoing European Commission's proposal to allow phosphates, used to keep seasoned kebab meat moist and aromatic, the industry considers it a threat event to the existence of meat in the popular fast food.

Prime Minister: new step is made to stimulate Latvian-Japanese cooperation

A new step has been made towards stimulating cooperation between Latvia and Japan in political and economic field. Latvia is not large enough for our businesses to focus solely on the domestic market. Our country has a rapidly-growing economy with a free market ready to make major steps towards transnational cooperation, said Prime Minister of Latvia Māris Kučinskis during his visit in Tokyo.

Theatre critic: there is historic importance in people’s trust of television

«Pop-culture’s influence over society should be viewed from two different perspectives. First of all, it is important to consider how society affects popular culture – what we see or hear at least partially reflects the modern society. Secondly, if created products turn out very influential, they inspire people and shift their thought processes or behaviour one way or another. This is because new and exciting products that have never existed until now, products that are considered marginal,» said theatre critic and Assistant Professor of Social Sciences Faculty of the University of Latvia Zane Radzobe.

MEP: Soviet Union’s activities in occupied countries are not discussed openly

Even to this day Soviet Union’s activities in occupied countries are not discussed openly and loudly, said member of the European Parliament Inese Vaidere at the presentation of the English translation of the book ‘Damage Caused to the Baltics by the Soviet Union’ in Brussels.

Expert: data importance will only increase in the digital transformation era

«Technologies are the driving force behind the development of all sectors in the 21st century. They affect our everyday lives and Latvia’s future development. We cannot afford to stop now. We have to continue developing innovations and creativity on all levels,» said Latvian President Raimonds Vējonis during the annual conference organized by Information and Communication Technologies Association.

Estonia in OSCE urges Russia to meet international standards in Ukraine

Estonian Minister of Foreign Affairs, Sven Mikser, draw attention to support of Ukrainian territorial integrity and the protection of human rights, as he addressed fellow foreign ministers at the meeting of the Organization for Security and Cooperation in Europe in Vienna this week.

Emotional debates break out in Saeima in regards to automatic access to state secrets

During the last meeting, very emotional debates in regards to automatic issue of access to official secrets were held. Proposals were voiced both in support of this and against. The proposal was declined in the end.

UK: EU citizens inside country «will be able to go on living as before»

In the talks on the UK leaving the European Union, London and Brussels have managed to agree on such key issues as the future of EU citizens within the UK and the border between Ireland and Northern Ireland, which will allow diplomats to move on to talks on the future relations between the bloc and the country after their divorce.

Polish head of government Szydlo resigns

The Prime Minister of Poland, Beata Szydlo, has stepped down, hours after surviving a no-confidence vote pushed for in the Sejm by the opposition.