Positive outlook for SMEs in Latvia

Take note – story published 6 years ago

The outlook for small and medium-sized enterprises (SMEs) in Latvia is favorable, the European Commission's Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs said in its annual report on European SMEs presented at the SME Assembly in Tallinn.

The Directorate General expects SME value added in Latvia to rise by 13.6 percent in 2016-2018 and SME employment by 4 percent. As a result, it is predicted that about 19,000 jobs will be created by SMEs in this period.

"Latvian SMEs experienced moderate growth in 2012-2016. SME value added increased by 15.2 percent while SME employment rose by 6.3 percent, very similar to the growth levels of large firms. Growth in micro firms was particularly strong, at 21.9 percent for value added and 12.8 percent for employment. However, in 2015-2016 SME growth has been less pronounced, with value added increasing by only 0.9 percent and employment actually falling by 0.9 percent," the report says.

As regards implementation of the Small Business Act for Europe (SBA), Latvia continues to have a competitive SBA profile, the Directorate General said. "In most areas, it [Latvia] performs above or on a par with the EU average. The only exception is skills and innovation, where it lags behind the EU average. Since 2008 Latvia has improved its performance in most SBA areas, especially in promoting entrepreneurship," it said.

According to the report, key challenges for productivity and competitiveness in Latvia are to rebalance the economy towards higher value added sectors and pursue a policy that promotes innovation and digitization.

"One of the main problems reported by SMEs is the lack of qualified employees: improvements in vocational education and training are necessary to address the gap between skills demand and supply," the Directorate General said in its report about Latvia.

You can read the full fact sheet on Latvia, plus information from the other countries, HERE.

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