Historically the lowest level of the investment environment in Latvia. Conversation with an expert – why?

Sauka explains the drop in rating with geopolitics. “In the Baltic states, geopolitics is the same for us, we are no different. We have a similar situation, we are on the border with a hostile country and a war next door. However, we see that foreign investors talk about competitiveness engines, that weaker things in Latvia are the ones that talk about development. Which largely explains why we lag behind Lithuania and Estonia,” said Sauka.

As reported, the Investment climate in Latvia has reached the lowest value in the assessment of investors in 2023, reaching 1.9 points out of 5, and compared to the measurements of 2022, it has fallen by 0.4 points.

“Currently, foreign investors in Latvia feel cautious – the number of investors who plan to invest in Latvia in the future has decreased: from 79% in 2022 to 67% in 2023. Entrepreneurs point to long-unsolved, constant problems that slow down both Latvia’s competitiveness and the attraction of new investments, such as the unavailability of labor, low quality of education, high level of bureaucracy and lack of investment attraction mechanisms. In addition, the high red tape burden on companies leads to high workloads and higher costs, resulting in end consumers suffering. The challenge for Latvia is defining a long-term vision that would outline a clear strategy for the necessary changes. The vision is very important for investors to feel safe and welcome in Latvia,” says Zlata Elksniņa-Zaščirinska, Chairman of the Board of the Council of Foreign Investors in Latvia (FICIL).

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