Translated using ChatGPT service.
In the annual report to the Saeima on the work and planned activities of the Cabinet of Ministers, Prime Minister Evika Siliņa included a series of reforms implemented or initiated within the competence of the Ministry of Economics since September 15, 2023, when the Saeima expressed confidence in Prime Minister Evika Siliņa's Cabinet.
"Through nine months of intensive work, we have managed to launch and update significant EU fund programs to support entrepreneurship, renew dialogue with industries, stimulate competition in the commercial banking market, and come close to an agreement with the banking sector on a substantial increase in lending volumes. We have approved a comprehensive plan to reduce bureaucracy in real estate development processes and implemented the highest level of supervision to remove obstacles in implementing major investment and export projects. We have developed and submitted a new comprehensive growth strategy for Latvia for Saeima and public discussion. The key elements are raising productivity and export capacity of Latvian companies, significant reforms in human capital development, innovation, and the introduction of the latest technologies, as well as achieving excellence in green economy, renewable energy, and bioeconomy. We have a clear vision for Latvia's future economic model and an understanding of the necessary steps for faster growth," emphasized Minister of Economics Viktors Valainis.
On April 30, 2024, the government approved Latvia's economic growth strategy, which aims to double the country's GDP from the current EUR 40.3 billion to EUR 83 billion by 2035. This is to be achieved by significantly increasing the productivity of Latvian companies—from 60% of the EU average in 2023 to the EU average by 2035.
To improve competition in the banking sector and protect borrowers, a regulatory framework for refinancing consumer mortgages with another lender has been developed, identified as an urgent task for this government. On February 15, 2024, the Saeima passed amendments to four laws to facilitate consumer refinancing of mortgages.
From 2024, a new state oil product security reserve management model has been introduced, envisaging a gradual acquisition of security reserves into state ownership by December 31, 2028. Implementing this new model is expected to save the state over EUR 500 million in the next ten years.
On April 2, 2024, the Cabinet of Ministers approved an action plan to reduce administrative burdens in real estate development processes. The plan includes nearly 60 measures to improve local level territorial development planning, land management, construction processes, cadastral surveying, environmental impact assessment, and deforestation. Implementing this plan will be a significant step in reducing bureaucracy in Latvia, promoting growth in real estate development and construction sectors, and attracting investments.
The Ministry of Economics has developed a Human Capital Development Strategy for 2024–2027. In close cooperation with entrepreneurs, it will provide a more precise insight into the needs of employers and employees, ensuring more effective interaction in human capital development. In the coming days, the Ministry of Economics will introduce updated medium and long-term labor market forecasts.
The work of the Council for Coordination of Large and Strategically Important Investment Projects has been activated, clarifying the council's composition, functions, and tasks. The first council meeting has already taken place, highlighting around 80 current investment projects, each with an investment volume of over EUR 10 million. Many projects have an expected investment volume exceeding EUR 100 million.
Eleven EU funding programs have been approved, totaling EUR 371.05 million, including financial instruments (start-up and productivity loans, guarantees, equity investments) and grant programs. Access to financing for SMEs has been significantly eased—ALTUM has reduced collateral requirements for loans up to EUR 100,000 and lowered interest rates for start-up and SME loans to 3% (for terms over 12 months) or 4% (for terms up to 12 months).
Work continues on the alignment of nine additional EU fund programs for developing new products, supporting jobs, industry training, energy efficiency, innovation loans, and port infrastructure, totaling EUR 649.58 million, which will become sequentially available following the Recovery Fund or EU fund reallocations.
Additionally, activities have commenced for the construction of low-rent housing in regions—four projects have already been approved for the construction of 314 homes in Valmiera, Bauska, Jelgava, and Tukums, with several more projects under evaluation and development.