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Sunday 24.06.2018 | Name days: Jānis

Swedbank: Latvia is the greenest Baltic country, but inequality remains a risk

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULatvia is currently experiencing rapid economic growth. Nevertheless, society is experiencing this growth at an unequal pace. Income inequality can negatively affect sustainable growth. Weak results in management (such as legislative power) put obstacles in the path of lasting economic development. This is why economic indexes should be observed from a long-term opinion, Swedbank representatives say.

«Sustainability has become part of companies’ competitive offers. Investors and businessmen around the world look towards sustainability criteria, which include environment protection, social inclusion and management, as well as their integration in business decisions and processes. Environment-friendly products and services are becoming more and more popular. The topic of equal job opportunities has also become very popular. New regulations keep on emerging, such as the compulsory sustainability criterion’s inclusion in financial accounts of major companies in Europe and new international agreements (such as the Paris Agreement). New ways of looking at those aspects come from UN Agenda 2030 for Sustainable Development. There are 17 sustainable development goals on the agenda. The entire world is responsible for accomplishing those goals,» says Swedbank senior economist in Baltics Lija Strašuna.

The bank’s experts say that there is a known amount of pressure coming from the governments in Latvia and Baltic region in general (largely because of European Union’s commitment to reduce emissions and further develop renewable energy sources). The first green bonds have already been released. They can be used around the world to help finance environment-friendly projects. At the same time, companies in Latvia do not experience as much pressure from competitors as companies in Sweden, where regular sustainability reports are already a norm. Still, it is a matter of time – sooner or later it will become a standard here as well. As usual, large exporting companies will experience that earlier than others. Sustainability standards for buyers and suppliers will increase. For many this could be a deciding factor in relation to cooperating with specific businesses.

Social inclusion in Latvia is in the red, reflecting insufficient progress made in efforts to reduce income inequality and poverty and improve healthcare, as concluded in Swedbank’s Sustainability Index. The bank has concluded death rates of mothers giving birth is higher in Baltics and one of the highest in Europe (18 deaths per 100,000 newborns). Strong institutions are an important pre-condition for a healthy business environment and development of entrepreneurship and investments.

All indexes compiled by the World Bank (political stability, efficiency of the state apparatus, rule of law, regulation quality, civil society) show that Latvia has the poorest results among Baltic States. Problems have been observed in regards to insolvency and legal affairs. Problems with Latvia’s financial sector also hold back the country’s development.

The improvement Latvia has accomplished in terms of time management in the past four years has been the most rapid one among Baltic States. In addition, improvements may continue after reforms, the bank concluded.

Swedbank’s study mentions that Latvia’s structural pre-conditions for sustainable growth are weaker than those in Estonia and Lithuania. The overall situation is considered in the yellow. The situation is rather poor when it comes to innovations – insufficient investments in research and development, and small number of registered patents. Even the involvement of adults in life-long education is low.

In regards to environment protection, Latvia is greener than Estonia and Lithuania. Latvia’s proportion of renewable energy is higher. The amount of waste and CO2 emissions are both relatively low. Still, Latvia is behind goals planned for 2030. Although energy efficiency is rather high, waster sorting in Latvia is below the necessary level.


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  1. Zerry says:

    Latvia could be even more green if reducing that use of salt for tryong to melt snow away.

  2. L says:

    Green by nature but not because people protect their very own home turf. Terribly polluted, no serious recycling efforts, corrupted waste management, no traffic management, stupid salt usage (which is prohibited in most countries since 20-30 years), etc.

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