RESTRICTED
WORLD TRADE WT/ACC/LVA/20
21March 1997
ORGANIZATION(97-1164)
Original: English
ACCESSION OFLATVIA
Communication from Latvia
Thefollowing information onindustrial policies hasbeenreceived fromtheMinistry ofForeign
Affairs oftheRepublic ofLatvia.
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Industrial Policy
Inrecent years theindustry ofLatvia haschanged considerably, bothincommercial terms
andinareas suchascompanies 'research effort andfinancial structure. TheGovernment structural
policy isaimed atestablishing acompetitive market economy inLatvia andthedevelopment ofastrong
andstable enterprise sector. Since largescaleStateenterprises prevailed inLatvia during thecentrally
planned economy, twoissues aremost important forsuccessful transition:
1) privatization ofState enterprises withemphasis ontheparticipation offoreign investors;
2) support ofthesmall andmedium sizeenterprise sector.
Having solved theabove mentioned tasksitwillbepossible toadjust Latvia 'smarket economy
structure tothatofthemarket economy. Theeffort torestructure andinnovate itisincreasing according
totheimprovement ofthebusiness environment. Thechanges intheprocess ofentering international
competition,industrialcompetition,regionaldevelopmentofindustry,innovationprocessandinvestments
inindustrial branches havebegun. Weconsider thatthecreation ofnewjobsandtraining intheexisting
industry should bethemost important goal, aswellasthedevelopment ofnewregional enterprises
through attracting investments andprivatization.
Other activities performed byGovernment aretheestablishment ofquality systems, training,
export promotion, attraction offoreign investments, creation ofphysical infrastructure, like:
telecommunications, utilities, transport infrastructure.
Thesupport ofentrepreneurs inLatvia isdirected towards: development ofnewenterprises;
support ofgrowth withemphasis ontraining andnetworking ofemployees andemployers, andfinancing
ofthecompanies; aswellastackling therestructuring ofenterprises.
TodeveloptheindustrialsectortheMinistryofEconomyhasdraftedtheConceptofGovernment
Strategy inIndustry andNational Programme ofSmall andMedium Enterprise Development, which
hasenvisaged thefollowing activities: investment promotion, industrial cooperation andcompetition,
industrial restructuring andcreation ofnewjobs, etc.WT/ACC/LVA/20
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Support rendered toentrepreneurship
TheGovernmenthasdevelopedasupportsystemtothoseentrepreneursmeetingtherequirements
setbyLatvian lawsinenvironmental, labour protection andtaxareas. Theprogramme provides for
thesupport totheentrepreneurs onalllevels oftheGovernment: Central andLocal.
Management training isbasically organized bytheMinistry ofEconomy through Business
Advisory Service Centres. Training courses andconsulting areorganized formore thantwothousand
entrepreneurs annually. Seminars comprise suchareas astheoverall management, financial structure,
productionproblematics,exportandimportdutiesandothers.Businessincubators,technologicalcentres,
technological parks andsoonhelptoadapt tothenewtechnology andresearch ofmarkets.
Training andnetworking
Training andnetworking isapartofthegovernment 'sprogramme tosupport entrepreneurs
andworkers. TheMinistry ofEconomy incooperation withthePhare programme hasestablished
atrainingnetworkofentrepreneursandkeypersonnelalloverthecountrythroughtheBusinessAdvisory
Service Centres.
Universities andcolleges havedeveloped special training courses forentrepreneurship gaining
alotofinterest among thestudents andlecturers.
Newtypes ofenterprise forums arearranged tointroduce thebusiness plans ofsuccessful
companies. Themanaging director andhisgroup willexplain andgothrough thebusiness planof
thecompany andtheaudience willhavethepossibility toraisequestions andmake comments onthe
issues.
Financing
TheGovernment ofLatvia willsupport expansion oftheactivities ofStateJointStock Company
"LatvianEksportkredit".Tomeetthegrowingneedsofriskfinancing,theGovernmentofLatviaintends
tocreate twonewagencies. Oneofthem istheState Guarantee Institute which provides guarantees
forthebanks, sothebanks 'riskwillbetaken bythegovernment authorities andentrepreneurs
themselves.
Theother institution willbetheRegional Development Fund, which could make riskloans.
Itwillalsoactasthegrouping initiator forfinancing andriskfinancing forlocalSME's.
Weconsider thepossibility ofpreparing several important reference books forentrepreneurs:
1. acomprehensive "workbook" forcompanies toprepare abusiness plan.This"workbook" will
beofgreat interest among thecompanies andtraining institutes;
2. aquality control "workbook" forcompanies togainexperience onISO9000 requirements.
Special seminars andlectures support these efforts;
3. adesign management "workbook" hasbeenprepared forcompanies tointroduce them with
requirements andmethods ofdesign management inagreater detail;
4. national reference book.WT/ACC/LVA/20
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Tosupport entrepreneurship theGovernment ofLatvia haselaborated aregional development
policy andpartofthepolicy willbeprobably devoted togrants andsubsidies forthestart-up and
expanding companies aswellasfortheonessaving power resources.
Agreement onSubsidies andCountervailing Measures
TheMinistry ofEconomy hasnotdeveloped asupport programme inaccordance withthe
Agreement onSubsidies andCountervailing Measures yet.Thediscussions onthisitemshould be
started inthenextyearonNational Programme forSME Development Board.