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Wednesday 07.12.2016 | Name days: Dzirkstīte, Anta, Antonija
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Experts calculate banking sector’s contribution to Latvia’s economy

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUIn 2014, the contribution of the banking sector to Latvia’s economy was 4.51% of GDP. The banking sector also secured more than 22,000 jobs, according to results of a survey by KPMG Baltics.

According to estimates of KPMG, the direct contribution of the banking sector to Latvia’s GDP was 2.44% in 2014. The segment of the banking sector’s local client base formed 1.27% of GDP. The segment of international clients provided 1.17% of GDP that year. As a comparison, Latvia’s agriculture sector forms 1.69% of GDP.

Money from the banking sector circulates in the country’s economy multiple times, contributing the economic activity of other sectors. In order to calculate the indirect influence of this sector on economic development, experts used Eurostat average multiplier for Europe’s financial services sector – 1.85.

The banking sector’s contribution to exports of goods and services is 2%. The banking sector’s added value and direct influence on Latvia’s services export was 7.28% in 2014. In addition it is also based mainly on foreign clients segment.

11,616 people were employed in the banking sector in 2010; 11,480 in 2011; 10,256 in 2012; 9,845 in 2013 and 9,362 in 2014. The average contribution of a single person employed in the banking sector to the country’s GDP is EUR 62,900, which is on average 2.6 times more than the average contribution in other sectors of Latvia’s economy.

Taxes calculated for the banking sector in 2014 were estimated at EUR 141.5 million. Of that amount, EUR 50.2 million is PIT, EUR 48.9 million CIT and EUR 42.3 million – state social insurance fees.

Ref: 102.109.109.7873


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