Prime Minister: Latvia will focus on 3 areas in recovery plan

In the crisis caused by COVID-19, the Latvian government will focus on benefits, infrastructure, and modernization, said Prime Minister Krišjānis Kariņš (New Unity) in a press conference on May 13.

After a conversation with the President of the Bank of Latvia, Mārtiņš Kazāks, the Prime Minister said that as the crisis will last longer than expected, it is important to work on lifelong learning and retraining support measures for people who will have lost their jobs. The possibility of involving workers affected by downtime in training programs is being assessed.

Regarding infrastructure, Kariņš emphasized that the government has already decided to divert an additional EUR 75 million to road repairs this year. 

Speaking of modernization, the government is assessing how to promote restructuring of economy. This includes support for science, including EUR 5 million to COVID-19 research.

"Let us continue to dynamically develop these 3 blocks: benefits, infrastructure, modernization," the Prime Minister said, adding that the aim is to use financial resources wisely.

Mārtiņš Kazāks noted that the direction Latvia's economic development has taken in COVID-19 crisis is correct. Initial support has not always been sufficient, but it has been continuously improving.

According to Kazāks, the measures in economic support development must respect four principles: targeted and progressive decisions, adequate risk-sharing between public and private sector, benefits for society as a whole, and sustainable spending. Also important is to respect solidarity.

The President of Bank of Latvia said that financial resources are sufficient to support the economy, but it should be remembered that resources are not infinite. During the crisis, Latvia's debt might increase to 50-55% of the country's GDP, but afterwards measures must be taken to return the debt level to around 40% of GDP. This would allow for better survival of upcoming crises.

 

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Economy
Economy