bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Friday 23.02.2018 | Name days: Haralds, Almants
LatviaLatvia

Economic Diary. Latvia is the only one once again

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Latvian officials are once again trying to widen the volume of information banks are required to provide at the request of State Tax Services. And they do this before similar requirements are set in the EU.

Premature requirements

Amendments to the Credit Institutions Law, that were announced this week, state specific cases when the State Revenue Service (SRS) can request information from banks. Particularly, information about a bank account, its owner or person allowed to manage it; the bank account’s state on the beginning and end period; the amount of taxes paid for interests for a specific period (if any); information or documents regarding some specific transactions, etc..

These proposals of the Finance Ministry caused objections in the Latvian Commercial Banks Association. One of the reasons for the objections was the description of the information SRS is allowed to request from the credit institutions for itself or at the request of its EU colleagues (or countries Latvia signed treaties with regarding exchange of such information). According to the Vice-President of the association Andris Rozentals, the point of “information and documents regarding specific transactions” seems too unspecific. According to him, the information that is to be presented according to this point is, at the very least, unclear.

Furthermore, as the association noted, the new amendments contain the formulation of “expected important information”. However, there is currently no agreement within the alliance as to what is meant under “expected important information”. The EC is still in the process of developing the form, using which the SRS will be able to compile requests to their colleagues from member-states. This is why the premature initiative of the Finance Ministry seems laughable.

Latvia is the only one once again

The outlook of GDP for 2012, according to the European Reconstruction and Development Bank, of all Baltic States seems entirely different. Latvia is the only country in the region to have its index increased from the previous value. The latest short-term perspective of the bank’s experts states that Baltic countries demonstrate flexibility and GDP growth before the signs of insignificant recession. Latvia’s achievements are noted above all else: “Latvia’s recovery turned out to be far more rapid than it was needed. The country should demonstrate the largest increase of GDP in the EU – at a level of 4.2%.”

As a result, Latvia’s outlook has been increased by 0.7% (from 3.5%) for 2012, Lithuania’s and Estonia’s outlooks have been reduced – from 2.8% to 2.7% and from 2.4% to 2.3% respectively. Local governments have also reviewed the values of Latvia’s economy: at first, the budget for 2012 was compiled with respect to GDP growth around 2.5%, this summer’s projection was raised to 4%.

A few words about trust

Survey results of GfK Custom Research Baltic and Nozare.lv, that were published this week, also turned out to be interesting. As it turned out, Latvia has the lowest level of trust towards the finance sector among Baltic States (3.9 out of 7), as well as the largest number of people who take swift credits. Estonia is one the second place in terms of trust – 4.3 points. Residents of Lithuania trust the financial sector the most – 4.5 point.

It also turned out that respondents’ attitude towards separate market segments of financial services could be better than that of the industry itself. For example, Latvians often take fast credits (22% of respondents), there are 18% of respondents in Lithuania, and 5% in Estonia.

The survey carried out throughout September – October 2 interviewed internet users age 18-65. All and all, 1802 Latvian residents, 856 Lithuanian residents, and 1 003 Estonian residents were interviewed.

Budget of strife

In conclusion, one more event that is directly related to us, even though takes place outside of Latvia. This, of course, concerns the long-term budget of the EU for 2014-2020. Cyprus has proposed to save up 50 billion EUR on European funds that stimulate the development of the poorest EU countries, including Latvia. The new budget has become a reason for strife for members of the alliance. Shortly before another summit, scheduled for November 22-23, EU donors have begun heavily criticizing the offer of the European Commission to set a large amount of budget expenses at 1.03 trillion EUR in seven years’ time.

These discussed measures can become troublesome for Latvia. Currently, ones to benefit the most from the equalizing policy are the least developed countries of the EU – mainly post-soviet countries of Eastern Europe, including Latvia. One of its main goals is growing the lacking members of the alliance for the creation of an “equal” European market. The effect the European funds have on our countries economy cannot be overestimated.

The Finance Ministry notes that GDP per capita has increased from 46% from the average European level in 2004 to 58% in 2011. 3.2 billion LVL are available to us in the current planning period (2007-2013), and this is the most significant funding resource of public funding.

State Secretary of the Environment Protection and Regional Development Ministry Alexander Antonov says: “Given that equalizing policy funds have been providing more than 90% of public investments in recent years, the possible fund reduction could have a negative effect on Latvia’s economy, because we will not be able to sustain growth at the rate we were planning.”

Ref: 017.109.109.4619


Leave a reply

Police commence investigation on possible money laundering schemes at ABLV Bank

Latvia’s State Police has commenced an investigation about the possible money laundering operations at ABLV Bank, which were reported by Financial Crimes Enforcement Network (FinCEN) US Department of Treasury.

S&P Global affirms Latvia’s credit rating at «A-»

On Thursday, 22 February, S&P Global reaffirmed Latvia’s credit rating on the «A-» level, retaining a positive outlook for the future, as BNN was informed by the State Treasury.

Kristovskis: state officials should be equally strict to Lembergs and Rimšēvičs

«Lack of consistency – such a conclusion appears after looking at the behaviour of state officials in regards to their request for Ilmārs Rimšēvičs’ to step down as governor of the Bank of Latvia,» says Ventspils City Council member Ģirts Valdis Kristovskis.

LSRTC: Zaķusala TV Tower’s reconstruction will cost several dozen million euros

According to chairman of Latvia’s State Radio and Television Centre (LSRTC) Jānis Bokta, reconstruction of Zaķusala TV Tower will cost several dozen million euros.

Trade union worried teachers may not have time to prepare for new education content

Teachers may not have enough time to prepare to work with new education content, said manager of Latvian Education and Science Workers' Union Inga Vanaga in an interview to Rīta Panorāma programme of LTV.

Judins, Loskutovs, Čigāne and Dālderis to continue working in Unity’s faction

Saeima members Andrejs Judins, Aleksejs Loskutovs, Lolita Čigāne and Ints Dālderis will continue working in Unity’s faction and coalition.

Saeima supports member’s proposal to publish wages of Bank of Latvia employees

Latvia’s parliament has decided to support Ints Dālderis’ proposal to publish wages paid to employees of the Bank of Latvia, education institutions, as well as municipal capital associations.

More snow expected on weekends; air temperature to drop even more next week

On the night to Friday, 23 February, air temperature in most of Latvia declined to -21° C… -27° C. It was only warmer in Kurzeme and some parts of Vidzeme, as reported by Latvia’s State Environment, Geology and Meteorology Centre.

SEB Bank: more employment options will open up and workers will become more selective

«It is becoming easier to change jobs nowadays. The largest selection of employment options are found in regional centres and cities, especially Riga and Pieriga. We see fewer employment options in regions even though there is still considerable demand for workers there,» predicts SEB Bank’s macroeconomics expert Dainis Gašpuitis.

ABLV Bank’s manager claims the bank is ready for cancellation of payment restrictions

ABLV Bank is ready for cancellation of payment restrictions, said the bank’s chairman Ernests Bernis during a press-conference on Thursday, 22 February.

62.9% of Latvia’s population was employed in 2017

Compared to the year before, in 2017 employment rate grew by 1.3 percentage points and number of employed persons by 1.5 thousand. Employment rate among men grew faster than among women – by 1.6 percentage points and 1.0 percentage points, respectively. 894.8 thousand people or 62.9 % of Latvia population aged 15–74 were employed in 2017.

Lithuania and Latvia: the tale between two sisters marked with rivalry

Relations between Lithuania and Latvia, two tight-knit Baltic neighbours, may exemplify a sisterly relationship from the first sight, but just over the course of a single week, several pings rang, signalling that rivalry is, and has always been, a component of coexistence.

Lembergs unable to organize his private life because of intense court proceedings

Lembergs unable to organize his private life because of intense court proceedings

Unemployment level in Latvia decreased to 8.7% in 2017

85.4 thousand people aged 15–74 in Latvia were unemployed in 2017. Compared to 2016, the number of unemployed persons has dropped by 9.9 thousand or 10.4 %.

Council member: ECB is openly dissatisfied with restrictions imposed on Rimšēvičs

The European Central Bank (ECB) is openly dissatisfied with restrictions imposed on one of its council members – governor of the Bank of Latvia Ilmārs Rimšēvičs, said council member of the Bank of Latvia Edvards Kušners in an interview to 900 seconds programme of LNT.

Defence expenditures in Latvia planned at EUR 234 million in 2018

Latvian government plans to spend EUR 234 million on defence projects, including procurement of transports, ammunition, armaments and individual equipment, in 2018 as confirmed by Defence Ministry.

Ministry cancels mandatory procurement component permits for five CHP plants

Latvia’s Economy Ministry has made a decision to cancel the permit to sell electricity within mandatory procurement component for five other renewable energy co-generation plants plants: SIA Madonas Eko, SIA Eiro-Āzijas investment agency, SIA EVOKEM, SIA M Parks, and SIA Eco Latvis.

NSC proposes Maizītis for a second term as Chief of Constitution Protection Bureau

Members of Latvia’s National Security Council have decided to propose the current head of the Constitution Protection Bureau Jānis Maizītis for another term at the helm of this institution, as BNN was informed by the State President’s Chancellery.

Latvijas gāze’s subsidiary Gaso proposes reducing gas transmission price

Latvijas gāze’s subsidiary Gase has turned to Public Utilities Commission with a proposal for a new natural gas transmission system service’s tariff project, providing for a reducing gas transmission price by 18-46% for more than 95% gas consumers.

FCMC invites Bank of Latvia to provide ABLV Bank with yet another emergency loan

The Finance and Capital Market Commission (FCMC) has invited the Bank of Latvia to issue ABLV Bank another emergency loan.

Crime rate in 2017 was the lowest in Latvia’s history

Last year’s crime rate turned out the lowest in Latvia’s history, as reported by Prosecutor General Ēriks Kalnmeiers in his annual report.

LEC: government priorities should include searching for causes and solutions, not the guilty

Latvian Employers’ Confederation (LEC) is worried about ongoing events and their negative effect on the stability and future development of the country’s economy. LEC believes that stabilization of the financial situation requires careful coordination of actions between institutions and the government.

Producer price level in Latvia grew 0.9% in January

Compared to December 2017, level of producer prices in Latvian industry rose by 0.9 % in January 2018. Prices of products sold on the domestic market went up by 1.2 % and prices of exported products by 0.6 %.

Latvian President believes country’s financial system is stable; prime minister plans to report to European Council

«Latvia’s financial system is stable, and there is no reason to worry about possible instability of the banking system. Banks continue working as usual,» says the President of Latvia Raimonds Vējonis.

Corruption Perception Index in Latvia experienced no major changes in 2017

Latvia’s positions did not improve much in Transparency International’s compiled Corruption Perception Index 2017, said Delna – Society for Openness acting director Liene Gātere in an interview to Rīta panorāma programme.