Transfers from compatriots living abroad – usually referred to as "remittances" make a big contribution to the economy. At the same time, Latvia lags behind the two neighboring countries in terms of accumulated investments by approximately ten billion euros.
In order to attract capital and promote the inflow of diaspora savings into the Latvian economy, Ar pasaules pieredzi Latvijā offers an eight-step program that will allow Latvians living abroad to invest their accumulated funds in Latvian companies.
"We offer a targeted program that would stimulate the redirection of these [money] transfers to investments in Latvian companies. Repeated studies show that the more ties diaspora members have with Latvia in any format: friends, acquaintances, real estate, any kind of ties increase the likelihood that a person will return, and this is another hook of the proposed program, how to plan it so that a person can return," said Miks Muižarājs, the deputy chairman of the organization.
In order for the program to start working, data will be needed on both the potential investment volume and the number of people who would be willing to invest. As the head of the Altum development bank, Reinis Bērziņš, pointed out at the session of the Saeima commission, it is important to know what form the investments would take – for example the sale of company shares or loan capital.
Altum's diaspora investment guarantee, capital gains tax discount or co-financing of state investments could be involved.
The program would also encourage the emergence of higher value-added businesses in regions where the diaspora could invest.
"The diaspora has been dealing with sending many millions or even billions a year to Latvia for many years. In this case, it would be another opportunity to both support Latvia and invest your money in Latvia. Diaspora organizations outside Latvia work very hard to communicate about Latvia as a safe environment to invest in. Therefore, the diaspora organizations themselves, which may currently invest their capital in world markets, would be ready to invest in Latvia," said Indulis Bērziņš, the head of the independent diaspora media outlet Latviesi.com.
"There are many examples – recently airBaltic attracted capital, the Bank of Latvia also issues savings bonds which are invited to invest in Latvia, and it should be emphasized how important communication with the diaspora is. My call is to do more of it," Bērziņš added.
The Saeima commission will invite the Ministry of Economics, in cooperation with Altum and diaspora representatives, to prepare an offer for attracting diaspora capital by October.
Representative of the Center for Diaspora and Migration Studies of the University of Latvia stated that the center plans to conduct a large-scale survey of the diaspora in the summer, which could help gather useful data.
