"We're taught in school – 'Don't cheat, it's very important that you learn algebra yourself' – and I agree with that sentiment... but in politics and in nation-building why reinvent the wheel when you can just look at how the wheel is made and then take the wheel and see if you can make the wheel a little better?" asked Kariņš.
His remarks centered on an impassioned plea for imaginative and progressive thinking about the roles and financial structures of state-owned companies so that they might act as pioneers in his stated program of "economic transformation".
The Prime Minister, early in his second term, suggested that Latvian attitudes to and suspicions of the capital markets were still shaped by the experiences of the 1990s.
"The privatisation process, although necessary, left in the taste of many people in our country a feeling that it was not quite a very fair process and it involved elements of less than honest action taken at the time by various politicians, some of whom were very high-standing in government, even," he said.
"That legacy is like a ball and a chain that is not letting us move forward... What we have is a whole bunch of state enterprises that are also huge, have a tremendous growth potential outside of this country," Kariņš explained, suggesting "political reasons and emotional, sentimental reasons" meant the potential of these enterprises was not being fully realized.
Speaking about his first government coalition, the PM said:
"For four years I tried to convice my colleagues we have to change our thinking. And for four years my colleagues in governent disagreed with me. And so here we are again, I'm at the start of a new government... and I'm trying to convince them that allowing a state enterprise – almost any state enterprise – to be partially floated on the stock exchange does not mean stealing or privatisation in the old, nineteen-nineties sense of the word."
Kariņš mentioned a joint windfarm project between Latvian State Forests and Latvenergo as an example of what might "tap the potential of investors to maybe go above and beyond what they are looking at today" and also cited Estonian energy company Enefit Green as a regional example worth emulating.
"This company has potential far beyond Estonia's economy to grow far beyond Estonia's borders and I want our companies to answer in kind," said Kariņš.
"We need our state companies to be unleashed. It's like this tremendous potential that I see. And politically speaking the decision-making is difficult because o the ball and chain of people falsely thinking that going to the capital markets is equivalent to stealing – as it was sometimes in the nineteen nineties.If we can break this thought process we can unleash a fantastic potential for these companies to open the door for other companies to go to the capital market."
Currently the Latvian capital market is tiny and if the Rīga stock exchange closed tomorrow it would barely even be noticed, the PM admitted.
"As a country, I'm convinced that what is holding us back the most is our own way of thinking. We have to break with the past and move into the future and developing the capital markets, letting our state enterprises open the door, is the best and the fastest and the most reasonable way to go," he concluded, quipping that if necessary he would drink five cups of coffee to get the message across.
