Chamber of Commerce: banks in Latvia hesitant to lend to businesses

Compared to other countries in the region – Lithuania, Estonia, Poland, and Scandinavian countries – banks in Latvia are less open to business and business lending, Aigars Rostovskis, president of the Latvian Chamber of Commerce and Industry (LTRK), said in an interview to Latvian Radio on April 4.

The Latvian central bank's forecasts show that this year there will be a very small growth in the economy, not a recession, as estimated earlier.

In order to boost economic growth, financial resources should be available, and the Saeima responsible committee will discuss this topic more broadly on Tuesday. Both economic operators and representatives of the responsible authorities and banks are invited to the meeting.

Banks play an important role in promoting access to money for the economy, Rostovskis noted, stressing that banks in Latvia are not as forthcoming as in neighboring countries, with consequences for competitiveness. “If we compare [Latvia] regionally with Lithuania and Estonia […] and slightly more broadly with Scandinavia and Poland, the situation is more difficult for Latvian businesses,” Rostovskis said.

“We've given our banking sector to the outside. We mainly have foreign banks in the financial sector, in most cases, decisions are taken outside Latvia,” said LTRK President.

LTRK's call is for banks to fund entrepreneurs more actively in order to avoid creating situations where it is easier for a foreign company in Latvia to receive funding than a home company, Rostovskis said.

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