The bony hand of budget cuts has reached the Latvian Investment and Development Agency (LIAA). The agency, accountable to the Ministry of Economics, has been tasked with reviewing its staff abroad.
Latvia currently has 38 embassies and permanent representations abroad. For its part, LIAA is the "main operational tool for attracting investments and providing export support, ensuring close contact with businesses and investors."
However, there is a "lack of coordinated approach" between the agency and the Ministry of Foreign Affairs. "In certain countries, there is an unevenness in activity and results, meaning that in markets where entrepreneurs' interest is low or cooperation with industry organizations is limited, the feasibility of representations is lower."
Who is a priority
For successful operation, it is proposed to jointly develop plans by LIAA and the diplomatic agency, as well as to interact with the Latvian Chamber of Commerce and Industry, the Latvian Confederation of Employers, the Latvian exporters' association The Red Jackets, and the Council of Foreign Investors in Latvia. Furthermore, "a review of funding and flexible redistribution of resources according to the division of priority and secondary markets is necessary."
According to the Ministry of Economics, the priority markets for Latvia are the Netherlands, the United Kingdom, Germany, Sweden, and Denmark — relations with them are good regarding the work of LIAA representations. There is a lack of activity in countries such as the USA, Canada, Japan, and France. In Ireland, which ranks 10th in the world for investments, the agency has no representation at all!
The secondary group includes countries such as Norway, Finland, Spain, Belgium, Italy, Ukraine (16th place for investments in Latvia and 13th for Latvian exports), South Korea, and Australia. The latter, despite having a Latvian diaspora and multiple visits from our politicians and officials, ranks only 42nd in the structure of national exports, while New Zealand is in 80th place...
They do not want to invest
It should be noted that the Ukrainian direction in LIAA is assessed quite realistically. Plans for 2025-26 foresee an increase in our exports to Ukraine by... 530,000 euros. This somehow does not match the hundreds of millions of euros that were directed to support the allied, fighting state! There are zero new projects in the portfolio with it. Although, the same blank is noted for Norway, the USA, and Switzerland. They simply do not want to invest in Latvia!
The Ministry of Economics meticulously calculated that the Ministry of Foreign Affairs duplicates the functions of LIAA. There are 19 people in the foreign policy agency serving specifically as economic representatives, and in 10 of the countries they serve, there are also offices of the Agency. Among them, by the way, are the USA, Norway, and Ukraine, with which no projects are foreseen in the near future.
Meanwhile, in many European Union countries, there are no representations of the Latvian Investment and Development Agency — although trade turnover with them is significant. Notably, Lithuania, Estonia, Poland, the Czech Republic, and Hungary can be mentioned.
