On Monday, 18 April, parties of the ruling coalition held a discussion about the government action plan. Maris Kucinskis also offered a new document regarding priority directions for the development of the national economy.
This document is intended as an addition to the to the government action plan. It is mentioned in the document that Latvia will not be able to maintain a competitive economy for long with low labour costs and massive use of EU funds.
The document also expresses commitment to secure balanced GDP growth around 5% starting from 2018. In order to achieve this goal, the government will carry out structural transformation of the national economy, activate businesses and enhance the competitiveness of products.
Kucinskis offers to establish a goal for Latvia to enhance its business environment, include Latvia in the TOP20 of Doing Business rating and TOP40 of the Global Competitiveness Index. In order to achieve this goal, it is planned to allow the state and municipalities to become more involved in business support efforts, become more closely linked to state information systems, improve the transparency and effectiveness of the court justice system, more actively work on attraction of foreign investments, identify priority industries, intensify the use of natural resources, optimize the public procurement system, create better conditions to local businesses, etc.
It is also promised to secure a balanced and predictable tax policy and make sure the volume of administered taxes reaches 33% of GDP by 2020. This is planned to be achieved with efforts to reduce grey economy by three percentage points by 2018. It is planned to state in the document the commitments to move the tax burden from work force to income from capital, consumption, real estate and use of natural resources.
It is also planned to contribute to the use of innovations in economy, making sure 47% of investments in this field come from the private sector. It is also planned to work on numerical increase of human resources and enhance the knowledge and productivity of workers. In order to achieve this goal, the government promises to carry out measures to enhance the demographic situation in ‘all aspects’, as well as improve the healthcare system.
Financing and accessibility of healthcare services will be reviewed, the government promises. The range of healthcare services will be defined in accordance with availability of budget funds, accessibility of human resources. The government also promises to develop a new pay model. The social guarantees and assistance system will be optimized as well. Structural changes to the education system are also promised.
Kucinskis said partners have agreed on the future progression of the plan. He also plans to meet with ministers this week to discuss the action plan with members of the Trilateral Cooperation Council.
Kucinskis emphasizes that the government has to work as a team. This is why it is important to find common ground and reach an agreement in regards to the action plan.
The Prime Minister said the government discussed 21 measures of the government action plan on Monday. He added that education was offered the most attention during talks.
Kucinskis had previously expressed his disappointment with action plans submitted by ministries and had ordered ministries to redevelop them.