Dynamic businessman uses EU funds to support local development

Coastal fishing combined with guiding tourists

Creating new earning strategies

A coastal fisher with a history serving on icebreakers, Andris Skuja plans another activity as he discontinues his work aboard icebreakers. The new job is to act as a local tourist guide introducing groups and individuals to the coastal fishery. He will take tourists out to sea in his fishing vessel, show them how he catches fish, bring them back and give them a meal of freshly caught fish, while entertaining them with stories about fishing, the sea, and the local area. The money he earns will be a useful supplement to his income as a coastal fisher.

The fishing is with 600 m of net and several fish traps. The 120 cm high nets are laid between 500 m and 1,000 m from the shore and are attached to the bottom. The main catch is usually herring, but Mr Skuja also catches other species such as round goby. The fishing season runs from mid-November to May and, after a break of a couple of weeks, goes on again to the end of September. From 1 October to mid-November fishing is again prohibited to allow salmon to breed. Apart from the temporal restrictions there are no limits on the fish he catches, with the exception of salmon, of which he may not retain more than one fish. Catching herring is demanding as with 600 m of nets he needs people and two boats. After catching it for two years Mr Skuja has decided therefore not to target it any longer. Herring is more suited to younger people, he says, but at his age (72), it is too challenging. Round goby is an invasive species for which there is no market in Latvia, so these catches are sold to a processing factory in the vicinity that will freeze and export them usually to Ukraine or to Romania and Bulgaria.

Andris Skuja, (standing right) welcomes a group of teachers on board his vessel. It is unfortunately too windy to take them on a sailing trip.

Dynamic businessman uses EU funds to support local development

Successful diversification of income sources

Small-scale commercial fishers in Latvia, as in other parts of Europe, are looking to diversify their sources of income. Factors such as the disappearance of cod, the presence of dioxin (in large salmon and herring), the spread of round goby (a highly predatory species, though now also a resource), eutrophication, damage by seals and over-wintering birds have contributed to reduce the size of catches.

To compensate for declining incomes coastal fishers are looking at other activities where they can use their existing knowledge and skills to generate additional income. A popular way of diversification is for fishers to work with tourists, for example, offering boat rides to observe the fishery, showing them around a harbour from the sea, offering a meal of freshly caught fish, taking them fishing etc. But some fishers also have more ambitious plans.

Using the local FLAG to good effect

With a background in the fishing sector Aigars Laugalis has availed of the funding opportunities offered by the European Maritime, Fisheries, and Aquaculture Fund (EMFAF) to create alternate sources of income. Together with his family, he now owns a restaurant and a brewery in Liepaja and has interests in various other enterprises many of which have been supported by EU funds. At the brewery he offers patrons fish-based snacks to go with their beer. These are traditional as well as innovative Latvian products such as smoked sprats in oil, batter-fried pieces of round goby in a tomato dressing, and balls of minced cod in a sauce among others. The products are served with bread and quail eggs and are intended to promote the local industry and local products. Mr Laugalis is a member of a Fisheries Local Action Group (FLAG) “Liepaja regional partnership” which includes municipalities that together have about 100 km of coastline. In terms of the number of participating smallscale commercial and subsistence fishers, the Liepaja FLAG is one of Latvia’s biggest. FLAGs are partnerships of fishing, aquaculture, and processing companies with local authorities, NGOs, institutions, and civil society organisation. Decisions are taken within

the framework of a local strategy, developed in response to specific needs and opportunities identified locally. Funding available is targeted primarily at creating employment and new economic activity as well as improving the quality of life in areas affected by a decline in fishing activities or by other specific challenges hindering the viability of local fisheries communities.

Mr Laugalis represents the 13 board members of the FLAG of which three members represent fisheries. His family has been involved in fisheries for many years. His father was recruited to work on a Soviet trawler fishing in the Atlantic for pelagic fish. After that Mr Laugalis senior joined a local fishing company and following the political changes at the end of the 80s managed some years later to buy out the company’s fishing vessels and quotas. Aigars Laugalis thus grew up in the shadow of fishing vessels and also spent time on board fishing, and processing the catch. At one point he even entertained dreams of becoming a fisherman with his own vessel. That, however, was never fulfilled, instead he went to Riga to study political science and business. In the meanwhile, as Latvia joined the EU in 2004 and the vessel decommissioning programme was introduced, the Laugalis trawlers were scrapped one by one over the years.

Mobile shop supplies value-added fish products to local towns and villages

The compensation from the decommissioning was invested in various other activities. Mr Laugalis together with his brother established a small processing factory for the production

Edgars Pohevi s

Different kinds of beer are produced at the brewery. The brand, Puta, offers visitors from southern Europe a laugh. With a point of departure in fishing Aigars Laugalis has diversified his family activities to encompass a processing plant, brewery, restaurant, and hotel among other businesses.

of highly value-added products such as the ones he serves at the brewery. These products are sold to local consumers and at local markets in and around Liepaja. Mr Laugalis’ brother uses a mobile shop to take the products to areas in a 100 km radius from Liepaja where they are sold. Both the production and the sales are ways of responding to consumer demand for more value-addition, and greater convenience when buying fish. The mobile shop serves areas where there is no local shop selling fish products or even if there is, the selection cannot match what the mobile shop can provide. The shop follows a strict schedule so that people know where and when to expect it and can make their plans accordingly. Purchasing power in these areas is not high and the products in the mobile shop reflect this. They are made with locally caught fish and are not overly sophisticated so that they can be priced at a level that is affordable for the target segment. Recent increases in production costs have made it more difficult to maintain the price level, so the mobile shop has been upgraded and will now start serving cities more, as purchasing power there is higher.

Mr Laugalis’ family fishing activity was slowly declining. This was partly due to a switch away from sprat and herring and towards cod, the fishery for which was closed shortly afterwards. One of the Laugalis’ vessels was therefore scrapped and the compensation used to start a hotel for tourists. The hotel functioned during the summer when there were plenty of tourists and then as the weather changed the tourist season ended and the

The building housing the restaurant, brewery, processing plant for value-added products, and other activities was renovated with EU support.

fishing season began. Another vessel was scrapped a few years later and, together with a partner who also scrapped a vessel, the proceeds were invested in a factory for primary processing and cold store. This investment was supported by European funds and over the last 10 years the partners have invested some EUR5m in the factory and cold store with the help of EU support. The factory is supplied by local fishers, but raw material is also imported to be able to supply all the year round.

Sharing knowledge of support programmes with other fishers

Not satisfied with just working seasonally Mr Laugalis and a partner went on to start another business with a fitness centre. Although this was not supported as it had nothing to do with local development, as a member of the FLAG he was familiar with opportunities to get support from EU funds and used this knowledge to implement small projects at the hotel, as well as in the other business ventures. But he also shared his knowledge about exploiting support opportunities with other fishers to encourage them to develop projects and apply for funding that would benefit them and at the same time contribute to the development of the area.

The building that now accommodates the brewery was an old warehouse and was purchased by Mr Laugalis senior in 1997. At that time the entire area was completely rundown, but the attraction of the building was that it had its own stretch of pier and so the vessels could land there. The warehouse also housed a repair shop where repairs and maintenance of the fishing vessels were undertaken. A few years ago, the Liepaja municipality understood that to make the city attractive to tourists it was necessary to renovate the area, create a promenade along the water, and make the port more accessible so that people could see and approach the vessels. Mr Laugalis realised that this development would bring many visitors to the area as it was only a short distance from the city centre. As the family building was so favourably located, it would be obvious to try and make use of the flow of people to the area. On the strength of his fishing activities, the staff he had, and the experience gained from developing and implementing projects, Mr Laugalis put together a proposal that would help to renovate the building and contribute to local development. The end result was a completely renovated ground floor that accommodated the microbrewery and restaurant. In addition, the repair shop was closed down and the small processing facility for value-added projects was established in its place.

A wide range of business activities

The microbrewery and restaurant opened in summer 2020 and proved popular despite (or perhaps, because of) the pandemic. However, they are essentially operations designed for the tourist season, about five months from April/May to September. Once that concludes the flow of customers dries up and the establishments are largely shuttered. Another factor currently affecting restaurant visits is the general belt tightening as consumers focus on essentials like paying their higher energy bills. Appropriately enough for a restaurant associated with a fishing company, 90 of the menu is fish. The most popular offering is fish and chips served with mushy peas and washed down with beer from the brewery, says Mr Laugalis, who put a lot of effort into finding the right fish, potatoes, peas, and in developing a recipe for the batter. The upper floors of the building are currently used for the fitness centre, meeting rooms for hire, and one section houses a museum with a guided tour describing the life of a worker in a herring factory a century ago.

With his multiple initiatives Mr Laugalis provides a sterling example of how to use the opportunities offered by the EMFAF and other EU funds to diversify income streams and to contribute to the local development of an area. Indeed, this is acknowledged by other FLAGs in Latvia who come to visit, taste the products, sample the beer, as well as learn from his experiences. His own efforts within the network of Latvian FLAGs and in other fora extolling the virtues of fishing and fishermen and the sector’s importance for the economy in small villages and towns along the Latvian coast won him an award two years ago for his promotional abilities. And he has also been instrumental in getting other fishers to see the benefits of the support programmes and motivating them to start submitting projects to the FLAG.

Aigars Laugalis

+371 29 780 736 aigars.laugalis@gmail.com

Companies: SIA Virkavi R; SIA

Ervils Activities: Primary processing and freezing of fish; manufacture of value-added fish products; brewery Puta; restaurant, hotel; fitness centre