Latviski English По-русски
Tuesday 23.05.2017 | Name days: Leontīne, Ligija, Lonija, Leokādija

Experts: Ventspils cannot allow transit to drift away

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUAlthough recent announcement from Ventspils officials create the impression that the port city has abandoned all efforts to attract new cargoes and instead has decided to focus on industrialization, economic experts say production is not enough to secure the kid of revenue transit can offer. It is necessary to think in both directions, as reported by

Baltic Association – Transport and Logistics President Inga Antane notes that Ventpils port is one of the European Union’s ports, which offers opportunities to use advantages of the single market. Ventspils City Council and Ventspils Freeport have to work with businesses present at the freeport and do everything they can to prevent any legal, technical and economic obstacles that prevent stabilization and future development of Ventspils port. According to her, industrialization is welcome as a method for business diversification, but this does not mean it is worth tossing away everything that has been built until now. The same applies to Latvia’s natural treasure – ice-free deepwater port that can handle large volumes of cargoes. «Ventspils has to work hard in all directions that can potentially bring the city and its residents additional income,» Antane says.

Swedbank economic expert Martins Kazaks reminds that Russia plans to start using only its own ports starting from 2018. The country plans to refuse transit services in third countries. This has been a known plan for the past two years. This is why it is only logical for a city whose main source of income is oil and oil product transit from Russia to search for new development directions. He is confident that Vitol, a major oil product trader, will continue carrying cargoes through Ventspils port from Russia just because the company has capacity in Ventspils.

«There is no need to dismantle rails and send them to Liepājas metalurgs for smelting,» Kazaks notes, adding that transit through Ventspils will no longer reach the same volumes as before. «The degree at which transit volumes will decline depends on our ability to find alternative cargoes. It is too soon to bury Latvia’s transit business. As a country, we can do a lot to attract new cargoes,» Kazaks says. He also voices his shock that Aivars Lembergs has suddenly begun defending interests of the capital’s port, not the interests of his city’s port, especially in regards to railway electrification.

«Ventspils’ economic problem historically revolves around having too many large companies and not enough small companies. If one large company experiences problems, the entire city starts coughing. It is not that economic problems in Ventspils are something previously unheard of. Transit will remain. But if current trends remain, transit flow will decline. If people want to earn more, we need something else. Industrialization, manufacture, production of export goods and export services are the main direction to ensure Latvia’s economy can grow,» Kazaks said.

According to him, it is necessary to look both ways – attract new cargoes and think about manufacture and industrialization. At the same time, he reminds that there are many small and interesting companies in Ventspils that add to exports.

SEB Bank’s analyst Dainis Gaspuitis believe there is no reason to completely turn away from attraction of transit cargoes, because even production with added value does not provide as much benefit to the economy as transit cargoes. «It is necessary to consider the development of other industries, but the transit industry should not be forgotten. It is necessary to think about tomorrow while there are resources to spare. We cannot allow resources received from transit to go to waste. The government has to be addressed – look, we’ve found a way to develop production and we need grants. It is necessary to look at transit trends and consider possible improvements. It would be the direction the state should look at,» Gaspuitis notes.

DNB Bank’s economist Peteris Strautins emphasizes that Ventspils’ decision to focus on industrialization is the proper way to develop the city in the time when profits from transit are declining. He does not deny, however, that any production is not enough to generate large enough income for the city and the country to match income brought by transits of Russian oil production.


Leave a reply

Razuks hints healthcare budget’s increase would require new fees

Sides involved in discussions about finding additional finances for healthcare have yet to reach a definite agreement. It is possible there may be a new fee introduced, said Saeima Public Health sub-committee chairman Romualds Razuks told Rīta panorama on Tuesday, 23 May.

Twelve million euros invested in creation of car wash network in Latvia

Wash & Drive opens the largest self-service car wash station in Riga. In cooperation with Citadele Bank, EUR 800,000 was invested in the creation of this seven-box car wash, as confirmed by the bank.

EC: Latvia’s tax system is less progressive than systems in other EU countries

The European Commission recommends Latvia to reduce the tax burden for small wage recipients and move it to other sources that are less impacting on growth and motivate people to pay taxes.

Latvia to lead joint air and land military exercises this year

Annual international military exercises Saber Strike will be taking place in Latvia from 3 – 15 June. Allied troops and armoured vehicles have begun arriving in Latvia for the upcoming exercises, as reported by Defence Ministry.

Tragic blast shakes Manchester, UK

In an explosion, which has occurred in a mass sports and music events venue in the British city of Manchester, 22 people have died and over 59 have suffered injuries.

Experts: Rail Baltica – connection that benefits everyone

The essence of Rail Baltica project is not combating the trends currently present in the world, but rather using them as an advantage, says advisor to the Bank of Latvia Andris Strazds. He adds that more and more economic and social development is centered in large and urban city centres.

Latvian companies ahead of neighbours in organization of business trips

Latvian businesses are more progressive in the organization of business trips than Lithuania. They do, however, spend a lot of money on planning and organizing of those trips. In addition, they also use inefficient financing methods – 20% of employees are forced to pre-finance their business trips from their own pockets, according to results of an international study.

Riga Eastern Clinical Hospital to identify patients using fingerprint data

Riga Eastern Clinical Hospital has introduced biometric data identification system that will be used to identify patients using fingerprint data, BNN was informed by the hospital.

FDC: micro-enterprise tax has created serious defects

The micro-enterprise tax has created serious defects for Latvia’s tax system, said Fiscal Discipline Council chairman Janis Platais in an interview to Latvijas Avīze.

Microsoft software licences cost Estonia millions each year

Estonian ministries and their subordinated institutions pay a total of under five million euros each year in Microsoft software licence fees.

Latvia’s unemployment rate was 9.4% in Q1 2017

In Q1 2017 the Latvian unemployment rate constituted 9.4 %. Compared to the previous quarter, the unemployment rate increased by 0.1 percentage points, whereas, compared to the same period of the year before, the rate reduced by 0.9 percentage points.

Pension expert: how far can index funds root themselves in Latvian pension plans?

Latvian pension plan clients can still pick existing pension plans with sufficiently flexible deposit policy and possibilities to receive consultations. It should be added, however, that pension plans based on index funds can find clients in Latvia for whom low-price guarantees is important the most, Nordea Pensions Latvia board member Ilya Arefjevs predicts.

Latvian Defence Ministry plans the largest tendering process in country’s history

This summer, Latvian Defence Ministry plans to announce the largest tendering procedure in the history of Latvia’s army. It is planned to procure heavy vehicles to transport armoured vehicles and troops. The total amount for the next ten years may reach EUR 200 million, as reported by Nekā personīga.

Study: engaging in business improves satisfaction with life

It has been concluded that psychological aspects are far more important than financial aspects in business operations – stability, family support, exchange of experience and realization of ideas are important for emerging businessmen, as concluded in a study performed by Altum.

Following use of EU funds, demand for loans increases in municipalities

Demand for loans from the State Treasury has increased after use of EU funds became more active, said Kaspars Abolins, chief of State Treasury, in an interview.

Swiss voters decide to move away from nuclear energy

Switzerland has decided to quit nuclear power stations and opt for renewable energy, show the results of a referendum held on Sunday, May 21, where 58% voters backed phasing out nuclear power.

Child vaccination made mandatory in Italy

Reacting to lower child protection against measles, the government of Italy has decided to make vaccination against 12 illnesses mandatory for children before they start going to state schools.

Deputies to decide on prohibiting gambling in Riga’s historic centre

On Monday, 22 May, deputies will discuss the matter on sorting out Riga’s historic centre. It is stated in new territorial plans that it will be prohibited for gambling halls to be located in this area.

Week in Lithuania. Lithuania to start paying child money in 2018

Lithuanian Prime Minister Saulius Skvernelis says that the government will follow up on its plan to next year start paying a monthly benefit for each child regardless of their parents' income, but adds that the state cannot afford to pay more than 30 to 50 euros in so-called «child money».

BNN summary of the week: problems with state financial accounts Baltics to promote healthy eating

BNN offers a summary of this week’s topical news in a variety of categories: Business; Future; Decline; Truth and Growth.

Specialists: noxious smoke from the fire claims more lives than the flames

The biggest damages during a fire are caused by flames, whereas noxious smoke from the fire kills more people, as noted by firefighting specialists.

FVS uncovered illegal sheep meat product trade

Inspecting an advertisement published on Facebook, Latvian Food and Veterinary Service uncovered illegal trade of sheep meat, canned meat storage and meat product distribution organized in an office building on Selpils Street, Riga, as reported by SRS.

Municipal elections 2017: what do people say?

With municipal elections gradually coming close, BNN offers a compilation of opinions provided by experts from different industries. Short answers consist of thoughts about specific municipalities that affect respondents directly, and municipal administrations in general – what people expect from officials and what changes they expect from elections.

Sweden decides to drop Wikileaks Assange arrest warrant

Prosecutors in Sweden have made the decision to quit the investigation in the case, where the founder of classified document leaking organisation Wikileaks, Julian Assange, is charged with rape and to drop the European arrest warrant on him.

Vejonis: we have yet to assess the use of funding in healthcare

In his interview to 900 seconds, Latvian President Raimonds Vejonis said the level of competent use of funding in the country’s healthcare sector has yet to be properly assessed.