Latviski English По-русски
Friday 19.10.2018 | Name days: Drosma, Drosmis, Elīna

Economic diary. People are what matters the most

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULatvia’s most precious economic resource is people. They are generally in a state of depression, do not have exceptionally good health and are not particularly well educated. These were the conclusions made by the World Economic Forum.

Talents needed…desperately

The World Economic Forum (WEF) is a Swiss non-government organization. This was the first time WEF decided to perform such a large-scale evaluation of human capital. As part of this research initiative, a special Human Capital Index was developed – a set of social and demographic factors aimed at helping researchers evaluate the value of a country’s population in economy.

Latvia’s most precious resource was evaluated as satisfactory. Latvia ranks 38th on the list consisting of 122 countries evaluated by WEF. Health quality, education and common skills of Latvia’s population is more or less on the level of Saudi Arabia, Chile and Italy. Lithuania is ahead of Latvia (34th place). Estonia, on the other hand, is ahead of both – 27th place.

Analysis of auxiliary factors shows that depression, weak health and low-quality education are some of the main problems of Latvia’s residents. “Investments in human capital are equally important for every individual and societies. This is doubly true when a population has a tendency to grow old and reduce in number. The lack of talents may become a serious problem for many developed and developing countries. Governments will need to consider the possible solutions for this problem in a short-term perspective and long-term development plans,” – authors warn.

Bank of Latvia = Rimsevics

There is at least one highly qualified worker in Latvia. It is the 48-year-old president of the Bank of Latvia Ilmars Rimsevics. He was recently proposed by parties of the coalition to remain for a third six-year term.

Mr Rimsevics, who has worked at the Bank of Latvia for nearly the whole of his career, can be proud. If he is re-elected to stay for a third term this December, he will become a member of the Board of Directors of the European Central Bank.

Mr Rimsevics took the post of president of the Bank of Latvia in 2001. He replaced Einars Repse, who decided to aim for the Saeima with his new party at the time. There were even speculations that he could become the President of Latvia in 2007. Two years ago, he was asked a question regarding his plans for the future. He replied that leaving the central bank while the country was in the process of getting back on its feet after the crisis would be irresponsible.

All 12 years of Rimsevics management over the country’s central bank did Latvia slowly progress toward euro. In order for Latvia to adopt euro as soon as possible, the decision was made to adopt the ERM 2 mechanism in 2005. In spite of the fact that the rules allowed for exchange rate fluctuations within 15%, the Bank of Latvia had decided to narrow it down to 1%.

“Party’s over, gentlemen”

Politicians managed to reach another compromise this week. It revolves around residence permit issue in exchange for investments in real estate. It is planned to reduce the number of approved applications next year.

In 2014, the Office of Citizenship and Migration Affairs will be allowed to approve only 800 applications from foreign buyers of Latvian real estate. This includes a maximum of 700 transactions worth EUR 150 thousand and EUR 100-500 thousand. In the following two years, this quota will be reduced by 175 every year.

Raivis Dzintars, co-chairman of the National Alliance, which demanded the limitation of the programme, told the press: “This is not an optimal solution, but it is the best possible one given this coalition.”

This “best solution” was not accepted by the business sector. Entrepreneurs believe this means the end for a more or less stable development of the market. Many current projects will not be finished; some of them will remain idle. The government will need to think how to employ the thousands of people who will likely lose their jobs. The state will also likely need a new economic safety pillow, because the budget will lose millions because of limitations to this programme. On top of that, many Latvian builders will likely leave the country once the projects they are working on fall idle.

Latvia gained more than LVL 460.5 million thanks to this programme since July 1, 2010. LVL 370.3 million of this amount was invested in real estate, LVL 66.6 million were transferred to banking deposits and LVL 23.5 million – base capitals of different companies.


Leave a reply

  1. JPR says:

    Rim service? Only in Latvia…

Merkel finds Brexit agreement still doable, but time running out

German Chancellor Angela Merkel evaluated after this week's summit of the European Union, that there is not much time left for an agreement on the UK leaving the bloc, but it a deal should still be realistically attainable.

Lithuania opposition MP: «The ruling majority muddles through a «foxy» budget»

For the fifth consecutive year, Lithuania’s new budget, now for 2019, is described as «record» due to the size of surplus and the hefty allocations to education, health care, innovations and reduction of social inequality.

Majority of Latvian residents believe the government does not respect their opinion

The majority of Latvian residents are convinced their government does not respect society’s opinion on different matters, according to results of a survey by SKDS.

Minister: results of European Council talks on Brexit are not surprising

The fact that talks organized by the European Council regarding Britain’s exit and conditions have concluded with no real progress, is nothing surprising, says Latvia’s Foreign Affairs Minister Edgars Rinkēvičs.

After Crimea college shooting, authorities look for accomplice

After a school in Russian-annexed Crimea suffered a shooting and explosive attack, with 20 people killed, the Russian occupation authorities have stated that a search is on for a possible accomplice to the attacker.

Number of newborns continues to decline in Latvia

The number of births registered over the first nine months of 2018 is 1,267 children or 8 % smaller than that registered in the respective period of 2017.

State Audit finds it difficult to follow use of funding for Latvia’s Centenary events

According to Latvian State Audit, it is hard to follow the use of funding intended for Latvia’s Centenary events.

EU and Britain agree to disagree, maybe for several months

After the European Union's summit decided that not enough progress has been achieved in Brexit talks to hold a separate Brexit summit in November, London has expressed readiness to consider the prolonging of the divorce transition period for some months.

Anti-Money Laundering Service to be supervised by Latvia’s Cabinet of Ministers

On Thursday, 18 October, members of the Saeima supported amendments to the Law on the Prevention of Money Laundering and Terrorism Financing in the first reading.

Latvian Saeima conceptually approves new Law on the Handling of Weapons

On Thursday, 18 October, members of the Latvian Saeima conceptually supported the project for a new Law on the Handling of Weapons. The legislative draft provides new classifications of arms and munitions, as well as coordination with EU regulations on weapons handling, as reported by Saeima’s press-service.

Latvia’s smallest 10th grade class has only three pupils

Latvia’s smallest 10th grade class has only three pupils, says Education and Science Ministry’s Education Department director Līga Buceniece.

Clocks to be turned one hour back on 28 October

28 October marks the end of daylight savings time in Latvia and elsewhere in the world. This is when all clocks are to be turned one hour back, Latvian Economy Ministry reminds.

Political parties in Latvia reject New Conservative Party’s proposed government model

None of the political parties currently engaged in government-formation talks in Latvia have agreed to the government model offered by the New Conservative Party.

Early voting option to be provided for all election sites during EP elections

On Wednesday, 17 October, Saeima’s Public Administration and Local Government Committee supported submission of amendments to European Parliament Election Law to the Saeima for the final reading.

Opinion: Attīstībai/Par! party would very much like to work with NCP

Attīstībai/Par! would very much like to work with New Conservative Party in the new government in Latvia given the opportunity, as journalists were told by AP co-chairman Daniels Pavļuts.

Number of cars registered in Latvia increases more quickly than average in Europe

In the first nine months of 2018, Latvia experienced a more rapid increase with the number of newly-registered light vehicles than the average in the European Union, according to the latest information from European Automobile Manufacturers' Association.

Seven Latvian companies listed among TOP 50 Baltic businesses

Among the 50 largest businesses in Baltics, seven hailed from Latvia in 2017. This is three businesses fewer than there were the previous year, as BNN was informed by representatives of Coface with reference to their list of the TOP 50 businesses in Baltic States.

1.7% less alcoholic beverages was produced in Latvia in first eight months of 2018

In the first eight months of 2018, 34.2 million litres of alcoholic beverages, except for beer, was produced in Latvia. 1.7% less alcoholic beverages was produced in Latvia when compared to the same period of 2017, according to data from the State Revenue Service.

Baltic states do slightly worse in Global Competitiveness Report

In the Global Competitiveness Report 2018 released by the World Economic Forum, Lithuania and Estonia have dropped by two positions, while all Baltic states remain among the top 45 most competitive economies in the world.

Latvian corruption prevention bureau undergoes reorganization; several experienced officials retire

Reorganization has been performed at Latvia’s Corruption Prevention and Combating Bureau. As a result of this reorganization, seven of the bureau’s officials have decided to resign. Six of them have decided to retire.

Russia starts trial against director Serebrennikov after long house arrest

In Moscow, the court proceedings against Russian theatre and cinema director Kirill Serebrennikov has begun on Wednesday, which is over a year after he was put under house arrest in a controversial embezzlement case.

Latvian Saeima wants to further enhance Anti-Money Laundering Service’s authority

On Tuesday, 16 October, members of Saeima’s Defence, Internal Affairs and Corruption Prevention Committee supported in the first reading amendments to the Law on the Prevention of Money Laundering and Terrorism Financing.

Canada enforces legalisation of marijuana, expects economic benefits

Canada is legalising marijuana for recreational use on Wednesday and economists forecast that the new manufacturing sector would bring many new jobs, investment and tax income.

Additional funding of EUR 232 million to be allocated for EU projects in 2018

Additional funding of EUR 232 million will be allocated for different European Union policy instruments and other kinds of foreign financial assistance projects before the end of 2018, as decided by Latvia’s Cabinet of Ministers on Tuesday, 16 October.

EU expects something creative from London for Brexit summit to deliver

The remaining European Union member states will expect in Brexit-focused summit that the UK would bring a creative solution to the issue of Irish border that has halted the talks.

Who would be the best choice for the next prime minister of Latvia?

View Results

Loading ... Loading ...

Polls Archive

Category feed: Feed: