Priority action lines of the Latvian government include OECD recommendations – to increase productivity, to reduce income inequality and to promote housing availability


Angel Gurría, the Secretary-General of the Organization for Economic Co-operation and Development (OECD), presented the 2019 OECD Economic Survey on Latvia in Riga on 29 May. The Economic Survey assesses the economic situation in Latvia, the process of implementing main reforms, challenges of the Latvian national economy and provides recommendations.


The economic survey points out that Latvia’s economic growth has been rapid, which has contributed to income convergence and reducing differences with the average level of developed OECD countries. However, in view of global trends, the growth rates of Latvian national economy are expected to slightly slow down in the coming years. According to OECD, Latvia needs to pay more attention to reducing income inequalities and increasing productivity, in order to continue to ensure growth, competitiveness and increased population welfare.


“The Economic Survey prepared by OECD experts is a very valuable document that should be used in day-to-day work by policy makers and the government. It will help Latvia to better implement its economic policy and the already launched structural reforms that are crucial for ensuring sustainable economic growth and competitiveness. I am pleased that the recommendations made by OECD are in line with the priorities of the Latvian government and the government’s action plan. It confirms that Latvia is on the right track,” emphasised Ralfs Nemiro, the Minister of Economics at the presentation of the OECD Economic Survey on Latvia.


“In particular, I would like to emphasise the recommendations by OECD on raising the basic allowance for low-wage earners, the reduction of the shadow economy and the housing policy, which until now have been given indirect attention in Latvia. Today we therefore submit to the OECD Secretary-General a letter of intent to start closer cooperation in order to develop more effective mechanisms to address the problem of housing availability in Latvia, continues the Minister of Economics.


The 2019 Economic Survey on Latvia has devoted considerable attention to productivity. OECD believes that the main challenges to increasing productivity in Latvia are related to relatively high income inequalities, on the one hand, and low levels of innovation, on the other hand. In order to further ensure productivity growth, the OECD recommends that Latvia reduces income inequalities, addresses regional differences between cities and rural areas including increases the size of municipalities by merging several municipalities, improving the accessibility of public transport organisations and availability of housing in regions that develop dynamically and offer better employment opportunities for the population. Latvia should also improve the efficiency of the judicial system, continue the implementation of reforms in healthcare and strengthen the education, science and innovation system. In order to address the lack of labour skills, OECD recommends strengthening work-based learning and adult education.


The OECD recommendations for Latvia included in the Economic Survey concern:

  • productivity-based growth;
  • fiscal policy and tax system;
  • healthcare;
  • regional development maters (efficiency of local government, public transport organisation, housing availability);
  • the social assistance system;
  • education and science policy;
  • and judicial system.


According to OECD practices, these types of surveys are published once in two years – this 2019 Economic Survey on Latvia is the third one. OECD aims to help governments by providing them with the best possible analysis, studies, recommendations and solutions in almost every area of economic policy.

Last update:    28-01-2020