Latviski English По-русски
Sunday 20.08.2017 | Name days: Bernhards, Boriss

Economic Diary of Latvia. Two scandals and both of them smell

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUAnother fumble involving sprats had taken place this week. This time, however, the story does not revolve around someone’s ban on sprats: local producers have accused the Latvian Foreign Ministry of ruining plans to supply Latvian sprats to China.

As it turns out, the first batch of Latvian sprats was supposed to leave for China in January. This has still not happened. Producers not only suspect foul play, but also accuse the Foreign Ministry of it.

«We don’t know who exactly in the ministry or embassy is responsible for this. But we do know that the trade agreement between Latvia and China has not been extended. Fish processing companies have managed to find an export market on their own in a difficult situation. The only thing that was remaining on the government’s side was to handle the technical details, but even this was has not been done. We have the appropriate certificate. What we don’t have is an extended agreement. This is not normal if the government hopes to receive taxes from exports,» – said the President of Latvian Fish Processing Companies Union Didzis Smits.

Manager of Brīvais vilnis company Arnolds Babris adds to the heat by saying that his company had plans to send five containers of sprats to China every month. The cost of a single container is EUR 50,000. With that, the company’s losses are estimated at EUR 250,000. «The goods were prepared to be sent. Unfortunately, now we’re forced to sell it elsewhere and at a lower price,» – said Babris.

The Foreign Minister responded to complaints one day alter. The ministry’s representative Ivars Lasis claimed Latvia and China have multiple agreements, but there is no agreement in regard to fish trade. All matters that revolve around exports of food products and their certification are handled by the Food and Veterinary Service and Agriculture Ministry, he added.

The two aforementioned institutions became active in this matter immediately after Foreign Ministry’s statements. According to the head of FVS Maris Balodis, China has changed rules that govern imports of fish products and the previous redaction of the agreement of 2004. He adds that FVS had only just received the new version of regulations from the Chinese embassy. Nevertheless, it has been filled and sent to Chinese institutions for approval.

Gazprom stands accused

Another story of international scale has taken place in the gas supply sector this week. The European Commission has sent complaints to the Russian Gazprom concern regarding alleged abuse of monopoly on the gas market in Central and Eastern Europe.

According to EC, Gazprom has breached Europe’s anti-monopoly regulations by intentionally dividing gas markets of Central and Eastern Europe. In particular, Gazprom is accused of limiting consumers’ rights to re-sell gas to other European countries. Such a practice allows the company in a position of a monopoly to set unfair prices on European markets, as mentioned in EC’s press-release.

Accusations raised by EC apply to Gazprom’s activities in eight countries – Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Slovakia.

Representatives of Gazprom claim the find complaints from the European Commission unjustified.

Latvian Prime Minister Laimdota Straujuma claims Gazprom will no longer be able to gamble in Latvia after EC’s report on abuse of monopoly. Nevertheless, she adds that Latvia has gas reserves for the event of an emergency.

Ukraine also wants to join the EC in terms of this initiative against Gazprom. According to Ukrainian Prime Minister Arseniy Yatsenyuk, the country plans to turn to its partners in Europe to hold a joint investigation of Gazprom’s monopoly in Ukraine and Europe. He believes Gazprom operates on non-competitive terms, which causes damage to Ukraine’s economy.

With that, it is worth mentioning that Laimdota Straujuma and Arseniy Yatsenyuk will meet in Kyiv next week.

Dreaming of working in the government sector

While high-rank officials are busy solving complicated matters, Latvians dream of working in the government. This is shown by results of a survey carried out by SKDS. 51.2% of respondents have admitted wanting to work in the government sector. They believe people there have the most stable wages and social guarantees. In 2011, 58.3% of respondents expressed the desire to work in the government sector. In 2012, this proportion was 49.6%. 31.6% of respondents expressed the desire to work in the private sector.

With that, data compiled by the Capital Market Commission shows that Latvians are not as bad off as many describe it. Last year, savings of Latvian households had increased by nearly EUR 1 billion – reaching EUR 8.1 billion. Most of this money is stored in deposits: EUR 5 billion, followed by state pension plans (EUR 241 million), bonds (EUR 193 million), shares (EUR 177 million) and deposits in different savings and loan societies (EUR 15 million).

As noted by the commission, the gradual reduction of loan burden, Latvia’s economic development, low inflation and rise of wages have allowed people to make savings more often. This trend has finally returned in 2013 after years of stagnation.


Leave a reply

Kirsis asks police to assess possible forging of votes at Riga City Council

Riga City Council’s Unity faction chairman Vilnis Kirsis has asked State Police to check if the city council’s electronic voting system was used without another deputy’s knowledge or consent, said the politician.

Expert: attack in Spain shows how terrorists switched to more easily reachable targets

Terrorist attacks that transpired in Spain this week shows how terrorists have switched to more easily reachable targets, where security requirements are not as strict, says Latvian National Defence Academy’s Security and Strategic Research Centre researcher Martins Hirss.

New mandatory tests in schools to be introduced four years from now

In four years’ time – 2021/2022 school year – it is planned to introduce completely new mandatory tests in schools, as reported by State Education Content Centre Director Guntars Catlaks.

Nearly 9,000 children and their parents got homes thanks to state support programme

In the first half-year of 2017, state support helped 1,527 families in Latvia to buy homes. Compared with last year, families’ demand for state support has grown 6%, as reported by Altum finance institute.

Prediction: Aseradens will likely take control over Unity

Economy Minister Arvils Aseradens will become the head of Unity, Betsafe bookmakers predict. The possibility of Aseradens becoming the head of the party is given 45% probability by Betsafe.

Provisional estimate for next year’s fiscal space in Latvia is EUR 60 million

Next year’s fiscal space has been estimated at EUR 60 million, as noted by Finance Minister Dana Reizniece-Ozola, adding that a more precise estimate will be available at the end of August.

Reconstruction of Vilnius airport runway concludes; aircraft return to Vilnius

On Thursday, 17 August, Vilnius airport’s runway was festively opened. This was the most massive reconstruction for the airport in the past 20 years. It was a unique project for Lithuania and all of Europe, airport representatives say.

Islamic State terrorist group takes responsibility for Barcelona attack

The recent terrorist attack in Barcelona, in which a shuttle bus rammed a crowd of people on La Rambla, killing 13 and injuring at least 100, has become this week’s topic.

Weather in Latvia to be warm but rainy on weekends

The sun will appear every now and then between clouds on Friday, 18 August. Still, some rain is expected, especially in the afternoon in Latvia’s eastern regions, where thunderstorms may appear. Rain is expected to reach the capital in the afternoon. Wind will draw in from the south. Air temperature will reach +21° C… +26° C, according to State Environment, Geology and Meteorology Centre.

Latvia’s export growth was moderately rapid in the first six months of 2017

Compared with the same period of 2016, Latvia experienced a moderately rapid export growth in the first six months of 2017, according to data published by Eurostat on Thursday, 17 August.

Latvia’s annual inflation in July was one of the highest in Europe

Inflation indexes in Latvia and the UK both reached 2.6% in July, which is one of the highest indexes in the European Union, according to data published by Eurostat on Thursday, 17 August.

Kirsis withdraws his candidacy in favour of Aseradens

Riga City Council member Vilnis Kirsis has decided to withdraw his candidacy from the race to become chairman of Unity in favour of a different candidate – Economy Minister Arvils Aseradens.

Rinkevics expresses Latvia’s interest in maintaining political consultations with Palestine

On Thursday, 17 August, Latvia’s Foreign Affairs Minister Edgars Rinkevics met with the leader of Palestine’s diplomatic mission in Latvia, ambassador Taissir Al Adjouri, to discuss mutual relations between Latvia and Palestine and the peace process in the Middle East.

Putin grins to the world’s seven billionth baby, Lithuania wary of border incidents

Russian President Vladimir Putin paid a visit this Wednesday to Kaliningrad, the westernmost point of Russia, but the reports about his trip in the Russian enclave and over the border in Lithuania were strikingly different.

Survey: red considered the safest colour for a car

Most Latvian drivers consider red to be the safest colour for a car. The most popular, however, is black, according to results of a survey by Virši-A fuel trader.

airBaltic’s number of carried passengers reaches a record in second consecutive month

Latvian airBaltic airline carried 393,312 passengers in July 2017, which is 21% more than the same period last year. The number of passengers carried by airBaltic remains the highest it has ever been in the airline’s history, BNN was informed by the company.

Brivais vilnis: nearly all fish processing companies are experiencing losses

Currently nearly all fish processing companies in Latvia are experiencing major or minor losses, says Brivais vilnis chairman Arnols Babris.

American helicopters to perform low-altitude flights within Latvia’s airspace

U.S. Air Force Brigade’s Task Force Phoenix helicopters, which are stationed in Latvia as part of Atlantic Resolve operation, will be performing low-altitude flights from 16:00 to 18:00 from Lielvarde to Dobele on Friday, 18 August.

Healthcare Ministry’s state secretary Karlis Ketners may be replaced

Latvian Healthcare Ministry may replace its state secretary Karlis Ketners. It is possible he will be transferred to work at Finance Ministry, as reported by LTV.

Suspects in Europe's insecticide egg scandal before Dutch court

In the Netherlands, two men have been in court in relation to the scandal of eggs containing banned insecticide that has caused an EU-wide health scare and cost millions of euros of damages.

Indian national with fake documents apprehended on Latvian border

An Indian citizen travelling from Moscow on a bus was caught at Terehovo border control point in Latvia for presenting officers a fake EU family member’s resident card. No criminal process was launched. The person returned to the country he was travelling from.

Latvijas dzelzceļš will not have to pay dividends from last year’s profits

The government decided on Wednesday, 16 August, that Latvijas dzelzceļš will not have to pay dividends from last year’s profits, which were EUR 880,998.

Latvian citizenship provided to 103 people

The Cabinet of Ministers has issued an order to provide Latvian citizenship to 103 people through naturalization.

Estonian Inbank's profits reach EUR 5.7 million in six months

Estonian financial services' provided Inbank made a profit of 5.7 million euros in the first half of 2017, which is a 429.4% increase compared to the respective period in 2016.

Agriculture Ministry invites residents to sign up for measures to support fisheries

From 21 August onward, Rural Support Service plans to start accepting applications for projects to receive support from European Maritime and Fisheries Fund’s action plan for development of fisheries in 2014-2020 as part of projects Innovation, Productive Investments in Aquaculture and Fishing and Aquaculture project processing.

Newest comments