Translated using ChatGPT service.
To support the promotion of competitiveness for entrepreneurs, €250 million in EU and state investments will be available in 2025. In the Ministry of Economics’ (EM) 2025 budget, the majority—slightly more than 61% of the total funding, or €122.8 million—is allocated for various support measures to enhance business competitiveness, including attracting high-value-added investments, supporting innovation, promoting digitalization, improving energy efficiency, and increasing export capacity. Together with already initiated and planned support programs, entrepreneurs will have access to over €250 million in EU and state investments.
In 2025, a new selection process is planned under the support program for loans with capital discounts for export-oriented entrepreneurs to support large investment projects. This aims to ensure the implementation of viable business projects focused on introducing new equipment and technological processes, fostering business development, competitiveness, and export growth. Under the program, support for medium and large entrepreneurs will be provided as loans with a 30% capital discount. Additionally, regulations for large and strategically significant investment projects will be reviewed to promote investment attraction and export growth in the areas of net-zero emissions and critical raw materials.
Simultaneously, a new support program for productivity loans for business innovations will be developed to ensure the availability of funding for the development of innovative products, including dual-use products. This support will include assistance for constructing new production facilities, purchasing equipment, and creating production connections. The program will have a total available funding of over €98 million, with support for micro, small, and medium enterprises and small to medium-capitalization companies provided as loans with a 30% capital discount, capped at €1.5 million.
To encourage innovation, in 2025, it is planned to develop a framework for applying and establishing special regulatory environments—a new regulation to support so-called sandbox environments. In 2024, the Innovative Entrepreneurship and Priority Project Support Law was adopted with the goal of increasing export-oriented investments and creating a regulatory environment conducive to testing and verifying new, innovative products, technologies, and services, thereby boosting economic competitiveness. The law also defines priority project areas and provides opportunities to create support measures for enhancing entrepreneurship and export capacity.
To reduce the administrative burden on businesses and expedite administrative coordination processes, while simultaneously enhancing Latvia’s competitiveness in attracting investments, in 2025 it is planned to review the "Green Corridor" regulations regarding the submission, evaluation, implementation, and monitoring procedures for priority projects, as well as the procedures for granting and revoking priority project status.
One of the Ministry of Economics’ priorities for 2025 will be preparing amendments to legislation aimed at reducing daily food prices to ensure these products are accessible to the entire population at an affordable price level, aligned with the purchasing power of Latvian residents, utilizing locally produced food products as a key element to achieve this goal. The Ministry of Economics has already prepared several proposals for reducing food prices, including setting markup caps for daily consumption food baskets, establishing minimum prices in each food category, introducing a digital price comparison tool, prohibiting the destruction of unsold food items by encouraging donation or discounted sales, and banning excessive and prolonged discounts on food products to stabilize consumer prices. At the same time, the Ministry has submitted amendments to the Unfair Retail Trade Practices Prohibition Law for review at the Cabinet of Ministers meeting, aiming to eliminate discriminatory practices in pricing between food products produced in Latvia and abroad, and to promote fair trade practices and equal competition in the food retail market.
In 2025, a Capital Market Development and Financial Access Action Plan will be developed, which will include an assessment of the current situation and existing issues. Over 20 tasks will be proposed for various state institutions to promote Latvia’s economic growth by improving the investment environment, developing the capital market, and increasing financial access. The goal is to increase the loan balance issued to non-financial corporations from 14% to 20% of GDP by 2035 and to double accumulated foreign direct investment in the equity of Latvian companies to €40 billion.
Work will continue on implementing the Action Plan to Reduce Administrative Burden in real estate development. The plan includes approximately 60 measures to simplify and make the real estate development process more efficient, where each subsequent step logically follows the previous one while maintaining guarantees for public rights and safety. The approved plan is critical for reducing bureaucracy, attracting investments, increasing Latvia’s regional competitiveness, and fostering the growth of the real estate development and construction sectors.
A new Construction Sector Strategy for 2025-2030 will also be developed, with the main priorities being to enhance the competitiveness and sustainability of the construction sector. Additionally, in 2025, the development of standard renovation projects for improving the energy efficiency of 316 and 602 series multi-apartment residential buildings will be completed, providing several solutions for façade insulation, including insulation with industrially manufactured panels.
In 2025, support for improving energy efficiency across various building sectors will continue. A new support program worth €173 million will be available for implementing energy efficiency measures in multi-apartment residential buildings, benefiting at least 266 buildings. Simultaneously, a state building energy efficiency improvement program will be launched, with funding of €114 million. This program will cover building energy certification, necessary construction works, engineering system improvements, and the introduction of automated control systems. Support is also planned for the procurement and installation of renewable energy technologies. Furthermore, an ongoing support program for businesses focused on greening operations, utilizing renewable energy sources, and improving energy efficiency will provide €55 million in EU funding, supporting more than 100 companies and attracting over €41 million in private investments.
In addition to the existing housing accessibility support measures, a new Altum program for regional housing loans is planned for 2025. Preparations for this program began in 2024 to find the most effective solution allowing Altum to issue mortgage loans for housing purchases in the regions.
Work will also continue on introducing the “debt follows the apartment” principle into legislation, with amendments to the Apartment Property Law and the Residential Building Management Law under review in the Saeima.
Ongoing activities to enhance Latvia’s cooperation with EU countries (especially Germany), Gulf states (particularly Saudi Arabia and the UAE), the USA, Canada, Japan, Korea, Ukraine, and Central Asian countries (Kazakhstan, Uzbekistan) will continue. In 2025, intergovernmental commission/joint committee meetings are planned with Ukraine, Moldova, Uzbekistan, Azerbaijan, and the UAE. Support for the reconstruction of Ukraine’s Chernihiv region will also continue.
Latvia will participate in the international exhibition Expo 2025, which will take place in Osaka, Japan, from April 13 to October 13. For six months, this will be an opportunity for Latvia and its entrepreneurs to showcase achievements, uniqueness, and foster new collaborations.
Efforts will continue in 2025 to reduce the most critical administrative barriers within the EU Single Market that hinder cross-border operations, such as opening bank accounts, territorial supply chain restrictions, and simplifying employee posting requirements in member states, among others.
To deepen and modernize the EU Single Market, we will participate in the development of a new EU Single Market strategy, ensuring the identification and representation of Latvian entrepreneurs' interests.
In 2025, work will continue on strengthening the accountability of officials in cases of competition law violations. The Ministry of Economics has prepared amendments to the Competition Law, introducing liability for market participants’ officials for breaches of competition law, such as violations of prohibited agreements. It is believed that assigning accountability will increase officials’ motivation to actively prevent violations or collaborate with the Competition Council in addressing already committed violations.
Work will also continue on improving insurance regulations. The large-scale floods and storms in August 2024 demonstrated that insurance policyholders do not always clearly understand the terms of insurance contracts and the coverage provided by their policies. To address this issue, the Ministry of Economics has prepared proposals for regulatory changes aimed at simplifying insurance contract terms and making them clearer for consumers, thereby reducing misunderstandings about insurance coverage.
Efforts will also continue to enhance consumer credit regulations. To ensure the transposition of the new European Parliament and Council Directive No. 2023/2225 on consumer credit agreements into national legislation, amendments to several laws will be prepared in 2025, focusing on modernizing existing requirements and introducing debt counseling services.
Work will progress on improving the hazardous equipment supervision regulations. Amendments to the Law on Technical Supervision of Hazardous Equipment aim to enhance regulations related to the digitalization of the Hazardous Equipment Register (HER), clarify the duties and rights of equipment owners, introduce requirements for inspection institutions, and grant the Consumer Rights Protection Centre (PTAC) the authority to issue binding decisions to owners. Concurrently, the Ministry of Economics will develop a Cabinet Regulation on the Hazardous Equipment Register and Technical Supervision, which will establish unified requirements for the technical supervision and procedures for hazardous equipment, including inspectors’ responsibilities, procedures for removing hazardous equipment from the register, and guidelines for marking inspected equipment.
Simultaneously, we will continue improving entertainment noise regulations. Many Latvian residents currently suffer from entertainment noise during nighttime hours, which affects their health. The Ministry of Economics has developed proposals for entertainment noise regulations, and discussions with stakeholders are ongoing to reach a balanced solution that accommodates the interests of all involved parties.
In 2025, in collaboration with SIA “Publisko aktīvu pārvaldītājs Possessor”, plans include the creation of essential goods reserves and the development of state oil safety reserves. Additionally, in cooperation with other ministries, the implementation of a new State Material Reserves Model will begin, with the management of state material reserves transitioning to SIA “Publisko aktīvu pārvaldītājs Possessor” by 2029.
To further develop human capital in 2025, plans include preparing a conceptual report on the most effective support tools for employers to enhance employees’ professional skills and retraining, a plan for integrating foreign students who have completed their studies in Latvia into the local labor market, and a monitoring framework for human capital development policies in collaboration with the Central Statistical Bureau. Work will also begin on the 2028–2035 Human Capital Development Strategy.
In 2025, the Ministry of Economics, in collaboration with the OECD, will commence preparations for the 2026 OECD Economic Survey of Latvia, the sixth such survey, providing recommendations to foster faster economic growth and development in Latvia. Additionally, an Informative Report on Latvia’s Economic Growth Strategy – Priorities for 2026 will be prepared to provide baseline information for discussions on priority actions to promote economic growth in 2026. Plans also include the creation of an AI tool for short-term labor market analysis and forecasting, utilizing AI technologies to gather information on short-term workforce needs in the economy.