Latvia - Economic Reform

Short-term priorities:

• to establish medium-term economic policy priorities within the framework of the Europe Agreement;
• to accelerate market-based business restructuring, in particular by completing the privatisation process;
• to continue strengthening the banking industry;
• to modernise agriculture;
• to establish a land and property register.

Assessment (October 1999)

These priorities have been achieved in part.

Privatisation of small and medium-sized enterprises (SMEs) is complete, but several large state enterprises in the utilities sector still have to be privatised. Further efforts in business restructuring will be needed for several years to come. Several initiatives have been launched in the agricultural sector, including the introduction of a credit guarantee fund; however, as the Russian crisis showed, further modernisation efforts will be necessary. Land registration is continuing and the state land register is almost complete, but registration in the legal register is still relatively low.

Assessment (November 2000)

In February 2000 a second action plan to improve the business environment was adopted. The privatisation of utility companies is continuing, albeit slowly. Registration of land in the land register is also slow. A new law introduced in October 2000 foresees the establishment of a regulatory authority for the areas of energy, telecommunications, postal services, household waste management and railways.

Assessment (November 2001)

The simplification of legal and administrative procedures (particularly in the fields of customs, taxation and movement at the borders) has encouraged investment and improved the corporate environment. Privatisation has almost been concluded. The registration of land in the land register is more or less completed, although registration in the legal register is somewhat slower. A regulatory body for the fields of energy, telecommunications, postal services and railways has been operational since September 2001.

Assessment (October 2002)

The register is a step closer to completion. The national computerised land register should improve the operation of the land market. The national programme for the development of SMEs has not yet been adopted.

Assessment (November 2003)

Please refer to the fact sheets on the adoption of the Community acquis.

Medium-term priorities:

• to consolidate the privatisation process;
• to step up market-driven restructuring in the enterprise, finance and banking sectors;
• to establish a legal framework for public services and financial services;
• to reinforce competition policy.

Assessment (October 1999)

Considerable progress has been made in strengthening competition policy. No progress has been made in the other areas.

Assessment (November 2000)

Preparations are being made for an annual tax monitoring procedure in line with EU procedures.

Assessment (November 2001)

The measures to support small and medium-sized enterprises have not had any major impact on their development. Access to finance continues to be one of the main obstacles. The annual budget monitoring procedure is being prepared. Social security contributions were reduced in 2000 and 2001. The final stage of the reform of the pension system has begun.

Assessment (October 2002)

Latvia has made progress in privatising large firms, in particular in the maritime transport and energy sectors and only a few large firms remain to be privatised. Further progress is also necessary to promote competitiveness, in particular by measures to boost domestic and foreign investments. On the whole, the priorities of the partnership for accession have been fully met.

Assessment (November 2003)

Please refer to the fact sheets on the adoption of the Community acquis.

Following the signing of the Accession Treaty on 16 April 2003, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia acceded to the European Union on 1 May 2004.

Last updated: 19.11.2004