The European Times - Latvia

Š The Latvian Institute

LATVIA

Content

Latvia INTRODUCTION

TRANSPORT & LOGISTICS

• Architect of Latvia’s Economic Miracle 4 • Eurozone Entry in 2014 Reflects Economic Turnaround 6 • Latvian Institute Enhancing Country’s Global Image 7

• Major East-West Transport Hub 16 • ABAVA 17 • Riga Electric Machine Building Works 17

TOURISM BUSINESS & INVESTMENT OPPORTUNITIES • Economics Minister Cites Privatisation Projects 9 • Open Doors for Foreign Investors 10 • Dzintars 10 • LAWIN 11 • Lara Polygraphy 12 • Red Dot Media 14

Langervaldes st. 2a LV - 3002 Jelgava Tel: +371 63 09 4300 info@evopipes.lv www.evopipes.com

• High-Potential Newcomer on the Global Tourism Map • Tallink Hotel Riga • Hotel Bergs • Avis Latvia • Royal Square Hotel and Suites

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31/1 Cesu st., 4th Floor LV - 1012 Riga Tel: +371 67 33 2887 lapa@lapa.lv www.lapa.lv

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architect of latvia’s Economic Miracle Prime Minister Valdis Dombrovskis has been called the ‘Architect of Latvia’s Economic Miracle’. He explains how his government managed to turn the economy around.

European Times: You formed your first cabinet in 2009 when Latvia was on the verge of bankruptcy. Now, after four years and three cabinets, Latvia is the EU’s fastest-growing economy. How did you do it?

Valdis Dombrovskis: The problems started after Latvia joined the EU and NATO in 2004. There was probably too much optimism after that. This positive outlook coincided with a general optimism in global fi nancial markets. Latvia began to register huge capital infl ows, but unfortunately this capital was not put to productive use. Infl ation neared double digits, the current-accounts defi cit was more than 20% of GDP, and there was a property-market bubble. And, to make matters worse, the Latvian government at that time did not balance the budget in spite of double-digit growth. Then, the real-estate bubble burst, the economy started to shrink, currency devaluation seemed inevitable, and Parex Bank, Latvia’s largest independent commercial bank, could not refi nance its syndicated loans and had to be nationalised. In late 2008, Latvia turned to the IMF for help. A couple of months later, the government collapsed. That is when my government took offi ce with the mission of sorting out this situation.

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Valdis Dombrovskis, Prime Minister

European Times: How did you turn the economy around?

Valdis Dombrovskis: The key factors were fi scal consolidation, economic stimulus measures and a reinforced social safety net. Between 2008 and 2012 we implemented severe and unpopular fi scal-adjustment measures adding up to 17% of Latvia’s GDP. These included reducing public-sector salaries by around 25%, reducing the size of ministries by around one-third, cutting in half the number of government agencies, and making comprehensive reforms in education and healthcare. Roughly two-thirds of the fi scal adjustments came from expenditure cuts, while the remaining third was in tax increases. We raised all kinds of taxes and introduced new taxes, for example a capital-revenue tax and

capital-gains tax. There is a lot of discussion in Europe today about austerity versus growth. In Latvia’s case, we had to restore fi nancial stability before the economy could grow again, so we made adjustments quickly, mainly in 2009. By 2010 Latvia’s fi nancial sector was stabilising and, by the second half of 2010, the economy began to grow again. When there is no fi nancial stability, banks do not lend, businesses do not invest, citizens do not spend, and the country falls deeper into recession.

Once fi nancial stability is restored, the opposite happens.

European Times: What did you do to stimulate the economy?

Valdis Dombrovskis: We needed to counteract the fi scal adjustments we were making, so we stepped up our absorp-

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Introduction

European Times: What specific measures have you adopted to keep the economy healthy and how much of Latvia’s current success depends on you personally?

tion of EU funds and used these funds to boost growth, especially of exportoriented industries, and to support social programmes. Between 2008 and 2009, we increased our absorption of EU funds by three-fold. We created additional social safety net provisions by prolonging unemployment benefi ts and increasing guaranteed minimum income benefi ts, improving accessibility to healthcare and medicines for the poor, co-fi nancing benefi ts with local governments, and, probably most important of all, introducing major temporary work programmes.

This helped us avoid the kind of social instability that Greece is currently experiencing. For the past two years, Latvia has increased its exports by an average 30%

and achieved a more than 10% increase in industrial production. One could say that industrial production and exports got the country out of the crisis.

European Times: Is the current growth stable?

Valdis Dombrovskis: Yes. We anticipate GDP growth of close to 5% for 2012 compared to 5.5% in 2011. One factor helping Latvia is that most of our foreign trade is with the Baltic and Nordic countries as well as Poland, Germany and Russia, and all these economies are doing relatively well. The Baltic region, in fact, is registering the most dynamic development in the EU.

Valdis Dombrovskis: Prime Ministers and governments can change, but if the right structures are in place, economic stability can be maintained. We have built the right foundations. We have boosted Latvia’s World Economic Forum competitiveness ranking by nine positions through increasing wages and productivity, reducing personal income tax from 25% to 20% over the next three years, and reducing the ‘shadow’ economy. We now offer reductions in corporate income tax for certain large projects and we want to use EU funds to add value to our traditional sectors, including wood processing, food production, metal processing and machinery, chemicals and pharmaceuticals, transport and logistics, and ICT. Our budget defi cit dropped to below 1.9% of GDP in 2012 and we aim for 1.4% in 2013. Interest rates are low, our credit ratings are rising, and the economy is growing. We aim to sustain this momentum.

European Times: What is your message to potential foreign investors?

Valdis Dombrovskis: Latvia is certainly one of the best places to invest today. Riga ranks number one among EU capitals in value for money as a business location, and Latvia has a competitive and highly skilled workforce, one of the EU’s lowest tax burdens, excellent communications and transport infrastructure, and many opportunities, including the privatisations of Citadele Bank, Air Baltic, and part of Mortgage and Land Bank. We have also established the Large Investment Projects Coordination Council to support investors. As a result of all this, we are seeing quite a substantial increase in FDI in Latvia.

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© Aleksandrs Kendenkovs - The Latvian Institute Old Town Riga

Eurozone Entry in 2014 Reflects Economic turnaround Latvia’s open, export-oriented economy achieved a stellar growth of more than 10% per year from 2006 to 2008 but then suffered a sharp decline of almost 25% during the global economic crisis. Now the economy is once again on a growth curve. GDP rose 5% in 2012, making Latvia the fastest-growing economy in the EU last year.

According to Latvia’s statistical offi ce, in the fourth quarter of 2012, Latvia’s economy grew by 5.1% more than its 2011 fourth-quarter growth rate, compared to 4.1% growth in Lithuania and 3.7% in Estonia over the same period.

Latvia’s success story continues. In the fi rst quarter of 2013, the Latvian economy grew 3.6% compared to the fi rst quarter of 2012.

Recognising this performance, the European Commission and the European Central Bank recently gave Latvia the green light to join the eurozone in January 2014. Standard & Poor’s responded by raising its rating on Latvia’s debt from BBB to BBB+ while Moody’s Investors Service assigned provisional (P)Baa2 and (P)Prime-2 long and short-term ratings to Latvia’s global medium-term-note programme.

Latvia’s national currency, the lats, has been pegged to the euro for eight years, but offi cially adopting the euro is a signal

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to the world that Latvia is on the mend. In fact, Latvia’s current economic fundamentals put most eurozone countries to shame.

The national debt, at just over 40% of GDP, is well below the eurozone’s 60% ceiling, and the government of Prime Minister Valdis Dombrovskis managed to reduce Latvia’s fi scal defi cit from 7.7% of GDP in 2010 to 2.7% last year.

Model for the eurozone The government achieved Latvia’s impressive turnaround by requesting a €7.5 billion bailout from the EU and the IMF and then by imposing stringent austerity measures and spending cuts. Unlike in Greece, these measures did not spark severe public protests, and Latvia is now being singled out as the model to follow for eurozone countries in economic distress.

Building on its strategic location, Latvia bases its economy on exports, and its transport infrastructure is highly developed.

Top sectors are timber and wood-processing, agriculture and food products, machinery and electronics. The majority of Latvia’s companies, banks, and real estate have been privatised, although the state still holds sizable stakes in a few large enterprises. Latvia offi cially joined the World Trade Organisation in February 1999 and the EU in May 2004.

The eurozone entry in 2014 is another sign of progress for this high-potential economy.

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latvian institute Enhancing Country’s Global image Karina Petersone, Director of the Latvian Institute, discusses the organisation’s priorities and projects.

European Times: What are the activities of the Latvian Institute and what experience do you bring to the post of Director?

Karina Petersone: The Latvian Institute is a crucial institution for ensuring Latvia’s long-term success as an international player. The Latvian Institute pursues public diplomacy within the Ministry of Foreign Affairs and focusses on enhancing awareness of Latvia worldwide. We are key players also in creating a favourable background for tourists and investors who are looking into Latvia. I feel that my experiences in the academic fi eld and in several high-profi le government positions, including as Minister of Culture and as an elected Member of Parliament several times, have given me a good foundation for promoting the country, not only from the knowledge point of view but from the emotional side as well.

European Times: What specific strategy are you employing to create a positive image of Latvia?

Karina Petersone: First of all, we are showing the world that Latvia is a developed and reformed country, both fi nancially and politically. We are promoting Latvia as a reliable international partner and as a country committed to solidarity within the EU. We are trying to promote more unique features of Latvia as well, such as the fact that Latvia is the world’s second-greenest country. Latvia’s tourism slogan is ‘Best Enjoyed Slowly’, which refl ects the country’s unspoiled natural and cultural heritage.

European Times: How is Latvia coping with the effects of the global financial crisis?

Karina Petersone: Latvia has taken very serious steps to reform our governmental and regulatory institutions in order to correct our mistakes. We have taken harsh cost-cutting measures and instituted budgetary constraints across the board. We have also taken serious steps to facilitate growth and transform the country into an export-based economy. We have restructured our finances to ensure sustainability and we aim to loosen

Karina Petersone, Director Latvian Institute

our taxes now that the country is back to stable growth and no more austerity measures are needed. What completely distinguishes Latvia from other countries is that it was the current generation that found solid solutions, not putting the weight of our problems on our children’s shoulders. We have reformed many sectors and totally overhauled the government. The Latvian people value these changes, as can be seen by the fact that the current Prime Minister has remained in office through these harsh times.

European Times: What is your personal message to potential investors and tourism visitors?

Karina Petersone: Latvia is a country with an unequalled resource: our people.

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• Open Doors for Foreign Investors

Business & Investment Opportunities

“We are committed to ensuring fair play and a level playing field, and to achieve this we must diminish the state’s involvement in the business sector.”

Daniels Pavluts, Minister for Economics

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Business & Investment Opportunities

Economics Minister Cites Privatisation Projects Daniels Pavluts, Minister for Economics, discusses the government’s current programmes involving the business sector.

European Times: What are your key objectives for the next few years?

Daniels Pavluts: One of our current priorities is to minimise the government’s presence in the private sector and in state-owned enterprises, because, as we all know, the state is not always the most effi cient or best regulating and administrative body for companies in a market-oriented economy. We are committed to ensuring fair play and a level playing fi eld, and to achieve this we must diminish the state’s involvement in the business sector.

European Times: Are you making any changes in the regulatory environment?

Daniels Pavluts: The government has developed a new law on the governance of state-owned enterprises which will soon be reviewed by the Parliament. This new law will result in more transparent governance through more effi cient and effective reporting.

State-owned companies will need to make quarterly reports containing much more specifi c information about how executives and board members are selected. Ultimately, the goal is to eliminate political interference and increase the quality of these appointees. The new law focusses on fi nancial supervision and dividend policy, and it will correct past inconsistencies. At the end of the day, we are working to ensure that these companies are

Daniels Pavluts, Minister for Economics

run more effectively and that they will deliver a better return on our equity. We believe that we can boost the output of these companies and we are very determined to increase their revenues and sustainability.

European Times: How is the government progressing on the privatisation of around 150 stateowned companies?

Daniels Pavluts: The country’s current state-owned companies include some major players, such as the national railroad, airline and utility companies, but most state-owned enterprises are smaller operations. We are currently reviewing all state-owned companies to decide which to keep under state ownership and which to privatise. One of the companies we are considering privatising is the national telecom enterprise Lattelecom. We would also like to exit from state-owned Citadele Bank by around 2014. This bank’s operating

effi ciencies are increasing and its costs are decreasing, so this represents an excellent investment opportunity. Many other companies would also be attractive to investors, such as AirBaltic, in which we will retain a stake but are looking to divest some of our shares by around 2015. This company has a newly appointed CEO and its future is very bright.

Katlakalna iela 4B LV-1073 Riga Tel: +371 67 50 2910 www.groglass.com

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Open Doors for Foreign investors Latvia offers significant advantages for foreign investors. These include the highest GDP growth rate in the EU in 2012, a strategic location bridging East and West, a skilled multilingual workforce, advanced transport infrastructure, a very open economy based on free trade, a number of tax advantages and investment incentives, and a stable, business-friendly government.

Dzintars Historic Cosmetics Enterprise Puts the Emphasis on innovation Dzintars has been known for innovation since the company was founded in 1849. Using only natural ingredients, Dzintars produces cosmetics, perfumes and make-up, all developed in the company’s research laboratory. Dzintars often produces products for other companies to market under their own labels. Dzintars has earned over 100 patents and Chairman of the Board Prof.

Ilya Gerchikov has obtained 159 patents of his own.

© The Latvian Institute

Latvia’s membership in the EU, Schengen and the World Trade Organisation, along with its upcoming entry into the eurozone in January 2014, add to this small but dynamic country’s investment appeal.

High-potential sectors

The company is certifi ed ISO 9001, ISO 14001, ISO 22716 and GMP Goodman Manufactory Practice. Prof.

Ilya Gerchikov says, “All our products compare to those of the best companies in the world. We have many specialists working for Dzintars to test every product in every aspect, and we have made major investments in the latest equipment and technologies. We put the accent on innovation. We do not outsource technologies and ideas; all our products are created within the company.”

The Investment and Development Agency of Latvia (LIAA) singles out key sectors for foreign investors. These are information technology (including data centres); green technologies; healthcare; life sciences; transport and logistics; metalworking and the manufacturing of machinery and electronics; woodworking; and food-processing.

Dzintars exports around 70% of its production and has 50 sales outlets in Latvia as well as a well-developed network of franchises in Russia, Belarus, Ukraine, Finland, Estonia, Lithuania and other countries. Prof. Ilya Gerchikov concludes, “Our competitive edge is that we make products that are better than others as well as cheaper, and we do it every day.”

Government and private-sector leaders in Latvia organised the fi rst World Latvian Economics and Innovation Forum, held in Riga in early July 2013, to showcase the country’s recent progress and strong investment attractions. At the event, Latvian Economics Minister Daniels Pavluts noted that Latvia aims to continue to expand its export activities, enter new markets, and spur on the development of its services while creating even more opportunities for foreign investors.

30 Malu st. - LV-1058 Riga Tel: +371 67 10 3930 dzintars@dzintars.lv - www.dzintars.lv

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Business & Investment Opportunities

laWiN

law Firm with 20 Years of Experience in Major FDi Projects LAWIN provides world-class legal services in the Baltics.

The firm was launched in 2004 to combine the talents of over 140 professionals from the three regional leaders - Klavins & Slaidins (Latvia); Lepik & Luhaaar (Estonia); and Lideika, Petrauskas, Valiunas (Lithuania).

Among the many awards that recognise the quality of LAWIN’s legal work are several inaugural European awards for this region, including ‘Chambers Europe Award for Excellence’ (2012) and The Lawyer’s ‘Law Firm of the Year’ - Scandinavia and the Baltics (2009), Baltic States (2011). The fi rm is also the exclusive Baltic member of Lex Mundi and World Services Group.

In Latvia, LAWIN has earned a strong reputation for its FDI-related work. Raimonds Slaidins, co-founder of the fi rm in Latvia and Chairman of the LAWIN Baltic Management Board in 2013, explains, “We were among the fi rst law fi rms to work with international investors in Latvia. When Filip Klavins and I (both American qualifi ed attorneys of Latvian descent) founded Klavins & Slaidins in 1992, local lawyers were just beginning to come into contact with the basic principles of commercial law. In those days, fi nding a lawyer with good English language skills was a rarity as well. We were able to provide the fi rst investors the type of services they were looking for as we had begun our careers as commercial lawyers in the US. And we started out with a bang - Kellogg’s was one of our fi rst clients...”

The fi rm grew quickly, as did the FDI in Latvia. Gaining its clients largely through word-of-mouth recommendations, LAWIN quickly became one of Latvia’s preeminent law fi rms for foreign investors. Now its stellar client list includes many well-known names, with Swedbank, DNB Nord, Coca-Cola, Johnson & Johnson, IBM, E.ON Ruhrgas being just a few of them.

LAWIN has also played a key role in Latvia’s development through its participation in a number of projects facilitating regional development and FDI to Latvia, including introduction of the JEREMY initiative by the European

Raimonds Slaidins, co-founder and Chairman of the Board

Investment Fund. The fi rm is active in various pro bono and legislation development initiatives.

Latvia has made great progress in enhancing its investment attractions, Raimonds Slaidins believes. He explains, “Latvia now has a legal system that conforms to EU norms, has greatly streamlined the process of establishing a business and can boast of a vastly improved business climate. LAWIN will continue to help clients to reach their business goals. We have the capacity, expertise and 20-year track record to make it work.”

Elizabetes 15 - LV-1010 Riga Tel: +371 67 81 4848 riga@lawin.lv - www.lawin.com

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lara Polygraphy

World-Class Design and Printing Services Through its dedication to serving its customers, Lara Polygraphy has expanded from an advertising agency into a diversified advertising, design and printing enterprise which is ranked among Riga’s top 10 printing companies. Lara Polygraphy is well known for its cutting-edge technologies, highly-skilled design team, and excellent quality-price ratio.

In fact, Lara Polygraphy has evolved to become a true one-stop shop. Owner Romans Astapovs explains, “Our advertising customers asked us to fi nd good printing houses we could work with, since it is more effi cient for designers and printers to work together. We decided to invest in our own printing plant in 2006, and we have grown steadily ever since. We are able to offer a full range of services, from design through printing, all at very attractive prices.”

Design and printing of all kinds of materials Lara Polygraphy (also known as Print Group) designs and produces all kinds of materials, from logos, business cards, catalogues and calendars to magazines, books, newspapers, folders, brochures, cup-holders, paper bags and much more. The company also designs logos and helps develop corporate identities, and is able to work with diverse materials and formats, including wide formats for fi lm, fl ash animation and PVC banners. Lara Polygraphy sometimes partners with sub-contractors for certain aspects of projects in order to streamline its services for its customers.

Romans Astapovs notes that Lara Polygraphy also provides full self-publishing services and is able to offer limited print runs so that customers will not have to order more copies of their books than they want. He says, “To be able to print your own book and carry on your legacy is a feeling we think every writer should be able to achieve, without the restraints and risks of having to order a minimum of 1,000 copies. As designers and printers, our goal is to help you achieve your printing and publishing dreams. Now every artist, photographer, blogger and writer can share their art with the world in a book or magazine.”

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Romans Astapovs, CEO and Vladislavs Aleksejevs, Co-Owner

Reliable supplier for European companies While Lara Polygraphy has been concentrating on the Latvian market, it is beginning to market itself to customers elsewhere in Europe. The company defi nitely has what it takes to serve all kinds of customers in Latvia and beyond.

Romans Astapovs explains, “I anticipate doubling our annual turnover from €1 million today to €2 million within two years. We are enhancing our website and online presence so that potential customers can fi nd us more easily. We are not a big printing company, but we know the Latvian market and we know how and where we can get good prices, good production terms and good quality. Customers outside Latvia will not need to research the Latvian market and look for a lot of advertising and printing suppliers here, because we can do the entire job for them.”

Lara Polygraphy has already had impressive success in attracting customers from abroad. Scandinavian advertising agencies, French tourism companies, Russian publishing houses, various airlines and the embassies of several countries are just a few of the international customers who have contacted Lara Polygraphy for their advertising and printing needs in Latvia.

The company’s local clientele includes banks, pharmacies, trading companies, publishing groups and enterprises active in foreign markets. Romans Astapovs points out, “We

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Business & Investment Opportunities

welcome all kinds of customers, whether they are individuals or small, medium-sized or large companies. As a mediumsized enterprise ourselves, we are able to be very fl exible and to make decisions rapidly, which speeds up the whole process for our customers.”

Focus on tailor-made services Lara Polygraphy prides itself on its tailor-made services, which include fi nding ways to reduce customers’ costs while also ensuring high quality. Romans Astapovs explains, “With us, there is no minimum printing quantity; we give you exactly the amount that you need. This means that you do not lose money by printing too many copies. Lara Polygraphy also offers the latest technologies and fi nishing equipment and a dedicated design team so that you can be sure you can count on us for a great personalised product.”

As an additional incentive, the company is currently giving a 10% discount on orders of more than €1,000 and a 30% discount for customers establishing a year-long partnership

with Lara Polygraphy. Potential clients can also get quotes for jobs online.

Lara Polygraphy continues to invest in new equipment and technologies to ensure that its processes are as effi cient as possible and that it can meet its customers’ deadlines. Romans Astapovs says, “We will always offer high quality at attractive prices to satisfy our customers’ needs in every way. I never say ‘no’ to a client! We are eager to prove our reliability to you.” He welcomes the chance to form new partnerships and to explore new opportunities with investors, customers and companies throughout Europe and beyond.

Kandavas 41a - LV-1083 Riga Tel: +371 67 41 3659 offi ce@printgroup.lv - www.printgroup.lv

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Red Dot Media

Dynamic Media leader Open to Production Partnerships RDM is responsible for some of Latvia’s best-known television programmes. One success story of the company is “Nothing Personal”, broadcast on TV3 Latvia. This weekly investigative-journalism programme is one of the 10 most-watched TV programmes in the country. “Nothing Personal” inspires debates and is regularly quoted in other media reports.

Exceptional TV documentaries and movies

Red Dot Media (RDM), a full-service production house, was founded five years ago but has already become a trend-setter in Latvian broadcasting. RDM was launched by a group of highly experienced television-industry professionals who wanted to form a professional, open, yet relatively small production house designed to play a key role in Latvia’s media sector. They have succeeded in their mission and continue to set ambitious new goals.

Along with producing several documentaries, RDM is currently fi nishing its fi rst feature fi lm in a partnership with Germany and Greece. Germany’s NRW2 Film Fund and the Eurimages production fund are supporting the project. RDM, the delegated producer, is Latvia’s only production company to receive Eurimages fi nancing. The fi lm, with the working title “Modris”, is set to premier in early 2014. It is being made with the participation of international fi lm professionals, including Oscarnominated director of photography Bogumil Godfrejow.

RDM also works in advertising and has a growing list of highprofi le clients, including Swedbank, TV3, Viasat, Merrild coffee, Laima chocolates, Martini Latvia, Delfi .lv and others.

RDM welcomes the chance to partner with foreign companies and production houses to co-produce documentaries and other types of programmes. RDM can also provide a wide range of services – including location-scouting, casting, equipmentsourcing, food services and more – for media companies looking to operate in Latvia and elsewhere in the Baltic region. RDM aims to be recognised as a driving force in Latvia’s media sector.

Dzelzavas st. 120s LV-1021 Riga Tel: +371 67 18 8440 rdm@reddotmedia.lv - arta.giga@reddotmedia.lv www.reddotmedia.lv

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• Major East-West Transport Hub

Transport & Logistics

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© Aleksandrs Kendenkovs - The Latvian Institute

Major East-West transport Hub Latvia has established itself as a benchmark for European transport and logistics thanks to its highly developed rail, port, air-transport and road infrastructure as well as its high-labour competitiveness and many investment opportunities in the transport and logistics sector.

Europe, the CIS countries and Asia. Latvia’s rail system transported a record 60 million tonnes of goods in 2012 (3.9% more than in 2011), around 81% of which transited through Latvia’s ports.

Ever since it established a free-market economy, Latvia has made the most of its strategic location and access to the Baltic Sea by investing extensively in infrastructure to support international trade. Latvia has three major, ice-free international ports − Riga, Liepaja and Ventspils − that are closely connected to the country’s extensive rail, road and pipeline system.

Latvia continues to invest in its transport and logistics and welcomes the participation of foreign investors in this key sector. Priority projects in the works include Latvia’s portion of Rail Baltica, a 1,435-kilometre-wide network of tracks connecting Estonia, Latvia and Lithuania with Poland and other European countries. Latvia also plans to expand the route of the ZUBR cargo-container train to the Ukrainian ports of Odessa and Illichivsk and to step up its investment in logistics and distribution services to strengthen its role as a regional trade hub.

Latvia is also the home of the biggest airport in the Baltics, Riga International, which handles almost twothirds of all flights in the region and serves over 70 international destinations with direct connections. The airport’s freight service handled a record 32,953 tonnes of cargo in 2012.

Latvia’s rail network, operated by state-owned Latvijas Dzelzcels, provides easy access to markets throughout

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Major projects in the works

Latvia’s National Development Plan for 2014-2020 calls for several major transport-infrastructure projects. These include implementing new systems to ensure safe navigation in winter in the ports of Mersrags, Roja, Salacgriva and Skulte; improving or building new regional roads and major highways; and improving connections between

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Transport & Logistics

the port and city of Riga and the EU TEN-T network.

Latvia’s most important highways, railways, ports and airports are already part of TEN-T. Latvia is also looking to the East. In June 2013, the Latvian government invited representatives from the EU, the US and several Central Asian and Middle East countries to a conference on the integration of Afghanistan and Central Asia into regional and global economies. The conference highlighted Latvia’s role as a major East-West transport hub.

Railway-Products Manufacturer Entering New Markets Riga Electric Machine Building Works (RER), established in 1946 and privatised in the 1990s, is building on its long history of manufacturing expertise to expand in the EU and international markets. The company specialises in producing traction equipment for electrical trains, light railways and forklifts as well as lighting and power-supply equipment for passenger coaches. As part of its expansion drive, RER recently purchased Lat-Trans Komplekt and 98.5% of the shares of JSC Latvo.

Around 99% of RER’s products are exported, mainly to Russia, but RER now aims to boost its presence in Belarus, Ukraine, Poland, Kazakhstan, Germany and the UK as well. “We plan to continue to diversify our project portfolio, supply network and markets, and we are investing in new procedures and training to help us meet all EU and international standards. In June 2013 we will receive EU certifi cation for our welding,” explains Mikalaj Yerokhau, Chairman of the Board.

aBava

ideal Business Base and logistics Partner

Rolands Gritans, Chairman of the Board

Riga Electric Machine Building Works

ABAVA is the ideal local partner for companies operating in Latvia. Rolands Gritans, Chairman of the Board, explains, “Our business park provides our customers with everything they need for successful business activities as well as a range of services.”

Mikalaj Yerokhau, Chairman of the Board.

RER’s clients include manufacturers of trains, passenger cars for trains and underground systems as well as companies producing railway equipment. Mikalaj Yerokhau says, “RER has a very experienced team which can provide complex services. Thanks to our long experience and extensive market knowledge, we can offer top-quality products at very competitive prices.”

ABAVA Logistic Service, established in 2009, provides everything from complete logistic solutions to warehousing (including frozen and chilled goods), customs and excise support and direct deliveries. Rolands Gritans says, “We are able to offer solutions which are both high standard and economical. Companies targeting the Baltic market can use ABAVA’s premises as a crossdocking hub.”

Ganibu Dambis 31 - LV-1005 Riga Tel: +371 67 38 1193 offi ce@rer.lv - www.rer.lv

Melluzu st. 1-7 - LV-1067 Riga - Tel: +371 67 40 3950 info@abava.lv - www.abava.lv

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Tourism

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© The Melody of Heavens - The Latvian Institute Baltic Sea

High-Potential Newcomer on the Global tourism Map According to the European Travel Commission’s report on European tourism in 2012, Latvia recorded the biggest increase in international arrivals over the first half of the year, welcoming 14.9% more international visitors. Latvia also topped the list in the number of nights international tourists spent in the country over the same period, reporting a rise of 17.8%. Latvian tourism is set to grow even more strongly next year when Latvia’s capital, Riga, assumes its role as the European Capital of Culture and puts its stunning architectural heritage, natural beauty and vibrant cultural scene on display.

Around half of Latvia’s inbound visitors are from neighbouring Estonia and Lithuania, although the country is also seeing strong growth in the number of visitors from Russia and other EU countries. Latvia is stepping up its effort to showcase its tourism appeal to travellers all over the world.

Seven UNESCO World Heritage sites Latvia offers all kinds of attractions for visitors. This compact, easy-to-reach nation has almost 500 km of sandy beaches, many well-preserved architectural monuments (including venerable cities once part of the medieval Hanseatic League), vast unspoiled natural areas, and

seven UNESCO World Heritage sites, which include Riga’s historic city centre. A trading hub for over 800 years, Latvia has long been open to other cultures and to foreign travellers.

To enhance its tourism appeal, Latvia is participating in the European Destinations of Excellence (EDEN) programme, which promotes sustainable tourism throughout the EU. EDEN singles out destinations with particularly strong tourism appeal as well as a demonstrated commitment to social, cultural and environmental sustainability.

The EDEN sites in Latvia demonstrate the country’s diversity. They include Ligatne Village north of Riga, set in picturesque Gauja National Park and known for its caves, clear waters and lush forests. Another Latvian EDEN site is Jurmala, the biggest beach resort in the Baltic. It is soughtafter for its mild climate, natural spas, pine forests, and 32.8-km white-sand beach.

Tervete Nature Park, set in an area inhabited since the fi rst millennium BC, features the Tervete History Museum and lovely Swans Lake. Rezekne, in eastern Latvia, is the home of traditional Latvian pottery, while Kuldiga, the ‘Latvian Venice’, was named ‘Best Emerging European Rural Destination of Excellence’ in 2007. These EDEN sites are just a few of the many reasons to visit Latvia, which has opened its doors to foreign travellers and tourism investors.

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the european times

latvia

tallink Hotel Riga

Riga’s Newest Hotel Offers World-Class Service Tallink Hotel Riga, one of the city’s newest hotels, features everything business and leisure travellers are looking for in an upscale city-centre hotel property. Built by the Estonia-based Tallink Group, which also owns and operates four hotels in Estonia, the Tallink Hotel Riga was designed and built from the ground up to meet the highest international standards.

General Manager Hannes Tall explains, “We provide excellent service because we believe that the product itself should be fl awless. You cannot rest when you reach success. You have to constantly work to improve, and that is what we do at the Tallink Hotel Riga.” He notes that the Tallink Group has grown into a key player in the regional tourism sector since it not only has fi ve hotels but also operates a cruise line under the Tallink and Silja Line brand names.

The Tallink Hotel Riga contains 256 elegantly decorated rooms and suites, including 21 single rooms, 197 double and twin rooms, 30 Superior rooms, ten double-deluxe rooms and three very spacious suites. The hotel’s amenities include the highly rated Elements restaurant, a real drawing

250 guests. Hannes Tall points out, “Our conference centre is very fl exible and can be divided into six smaller rooms. It can even be connected to the restaurant, which can increase its capacity. We want to meet our clients’ demands, so we are ready to provide a variety of solutions to fi t our customers’ needs.”

card since its chef was named as one of the ‘Best Chefs in Latvia’ last year and the restaurant was named ‘Best Kitchen’ among all Tallink Group cruise ships and hotel properties. The Tallink Hotel Riga is also the home of the convivial Café Balanss, which serves tasty homemade pastries, croissants, sandwiches and light salads.

The hotel contains its own state-of-theart meeting space which can serve up to

Guests can also get fi t and pamper themselves in the hotel’s sauna and gym or indulge in beauty treatments and coiffeur services at the Hera Beauty and Wellness centre, which offers a range of treatments using high-quality Sothys cosmetics.

Explaining why guests should choose the Tallink Hotel when they visit Riga, Hannes Tall says, “We are one of the newest hotels in the city, and we are very fl exible and open for cooperation.

Our hotel is suitable for both leisure and business travellers and we always maintain a very high standard of services. I can say – we serve from the heart – enjoy it!”

24 Elizabetes - LV-1050 Riga Tel: +371 67 09 9760 booking@tallinkhotels.lv www.tallinkhotels.com

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the european times

Tourism

Hotel Bergs

World-Class, trend-Setting Hospitality The Omnium Properties Group has brought world-class standards to Latvia’s residential and commercial real estate sector as well as to the hospitality industry. Since 1991, Omnium Properties specialises in renovating and managing historical buildings throughout Latvia, including the Bergs Bazaar. Originally built in 1887, the Bergs Bazaar is a meticulously restored pedestrian arcade in Riga’s city centre featuring a five-star hotel, boutique shops, restaurants and cafés, offices, luxury apartments and even an art house cinema.

In 2003, Omnium Properties launched a hotel-management company which today oversees two luxury properties, the fi ve-star Hotel Bergs in the Bergs Bazaar and Rumene Manor in the Latvian countryside. The American-Latvian CEO Aleksis J. Karlsons says, “Our goal in creating a hotelmanagement enterprise was to provide a unique experience for visitors to Latvia, not just a standard hotel environment.

Our guests enjoy an authentic experience while receiving top-level service and amenities. We have an international perspective on customer service and our highly trained, multilingual staff members know how to provide what discerning travellers are looking for.” Hotel Bergs is a member of Small Luxury Hotels of the World and offers 38 designer suites from 45 sq m to 80 sq m. In addition, the hotel is home to Restaurant Bergs, which is consistently rated as one of Riga’s top restaurants.

Aleksis J. Karlsons, CEO

For visitors looking to explore Latvia’s countryside, Hotel Bergs has recently opened its countryside residence Rumene Manor, a renovated 19th century Baltic-German manor house about one hour by car from Riga. Aleksis J. Karlsons explains, “Rumene Manor offers fi ve-star comfort that can compete with those of any chateau hotel in France or Italy. Guests can enjoy a range of activities, from hunting and fi shing to croquet in the park and biking. We also offer wine tastings and cooking classes. We have given travellers a luxury option in the Latvian countryside. As Hotel Bergs did in Riga, Rumene Manor is setting a new trend in Latvia’s tourism industry.”

For those looking to relocate to Riga, Omnium Properties also rents around 60 elegant apartments ranging from 75 sq m to around 300 sq m throughout the historic centre of Riga. They are very popular among executives, ambassadors, embassy staff and other high-profi le visitors. Aleksis J. Karlsons notes, “Again, customer service has been the cornerstone of our success. We even have clients that have been with us close to 20 years. We not only provide stylish and comfortable living spaces but are also highly responsive to the needs and concerns of our tenants.”

Elizabetes st. 83-85 - Riga Tel: +371 67 77 0900 hotelbergs@hotelbergs.lv - www.hotelbergs.lv rumene@hotelbergs.lv - www.rumene.lv

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the european times

latvia

avis latvia

international Car-Hire leader Offers Competitive advantages Global car-hire leader Avis has established a strong presence in Latvia. Building on more than 20 years of experience in the local market and thanks to the expertise and high standards that give Avis its competitive edge worldwide, Avis Latvia offers a full range of products and services, from short-term rentals to fullservice leasing. Last year Avis Latvia won an award as a top transportation-services provider and has always guaranteed its customers the same level of service that Avis is known for all over the world.

Andris Ribaks, Chairman of the Board, explains the Avis advantage.

He says, “We are constantly working to improve our services and the quality of our fl eet. We invest extensively in employee training and we have a ‘three-minute’ promise that means that if you book a vehicle with us, we promise you that we will take care of all details within three minutes of entering our offi ce. We constantly monitor the market in order to provide what our customers want, and we always focus on offering good quality and service.”

Wide choice of vehicles, with or without drivers Avis Latvia has a short-term fl eet of around 140 vehicles on hand in the busy summer season and offers around 13 different types of automobiles, from very popular compact cars to four-wheel-drive options and

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Andris Ribaks, Chairman of the Board

luxury sedans. Premium vehicles are available with or without a driver. Most of Avis Latvia’s business is for corporate clients, including multinational as well as local companies. “Customers come to us because Avis is a known brand and we keep our standards high,” Andris Ribaks says.

As a member of the international Avis network, Avis Latvia also provides its customers with the convenience of the Avis online reservations system as well as access to the well-established Avis network throughout the Baltic region and beyond. Urging business and leisure travellers in Latvia trust Avis for their car-hire needs, Andris Ribaks says, “If you rent an Avis car in Latvia you can drive it in Estonia or any other Baltic

country for the same price, with no extra fees. For our corporate customers, we offer very advantageous long-term leasing contracts. At Avis, we care about our clients and we make car use easier!”

11 Novembra Krastmala 29 Riga Tel: +371 67 22 5876 avis@avis.lv www.avis.lv

the european times

Tourism

Royal Square Hotel and Suites

luxury Hotel in Riga Guaranteed to Exceed Guests’ Expectations The five-star Royal Square Hotel and Suites in Riga, winner of the coveted ‘Leading Hotel in Latvia 2012’ prize at the World Travel Awards, offers exceptional luxury amenities and services along with authentic Latvian style. The locally owned property is a member of one of the country’s top hospitality groups, which includes a diverse range of quality hotels, restaurants and entertainment options. The Managing Director explains, “There are competitor hotels that claim that they have local Latvian flavour, but their owners and managers are foreigners. We are Latvian, managing a local hotel in a local hospitality organisation, and that makes us unique in Latvia amongst exclusive hotels.”

With only 30 rooms and a choice of spacious suites, the boutique hotel focusses on providing its guests with truly personalised services. The hotel has 18 classic rooms, eight executive rooms, two deluxe suites (each with a fi replace and private sauna), one luxury suite with its own fi replace and sauna, and the Royal Suite with two bedrooms.

Guests at the Royal Hotel and Suites can indulge in a guests-only sauna and

ancient stone walls and with views through a glass fl oor of a well-preserved historic well, Restaurant Desiderata’s elegant dining room is the essence of Riga’s Old Town in its ambiance. It is also the perfect venue for enjoying fabulous gourmet dishes, accompanied by the fi nest wines.

Jacuzzi, enjoy gourmet cuisine in Restaurant Desiderata – voted the best restaurant in Latvia in 2010 – and relax in the convivial Secret Garden nightclub.

Executive travellers can also make use of the hotel’s choice of meeting facilities for groups of up to 25. Set right in the centre of Riga’s historic Old Town, the hotel is also just 12 km from the city’s international airport. The Royal Square Hotel and Suites was built on the remnants of Riga’s 16th century city centre and offers a winning combination of historic character along with state-of-the-art facilities and services.

Best restaurant in Latvia in 2010 Another draw for guests is the hotel’s Restaurant Desiderata, with its unique décor and atmosphere. Set within

The Managing Director says, “We urge international travellers to discover Riga and to stay at the Royal Square Hotel and Suites or in one of the group’s other properties. We believe that Riga has the potential to become a destination for longer stays, because there is so much to see and do in the city and throughout Latvia. And on their trips to Riga, guests should choose to stay with us. We guarantee to exceed your expectations.”

Kalku st. 3a LV-1050 Riga Tel: +371 67 21 4555 info@royalsquare.lv www.royalsquare.lv

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Elegant and cozy interior and high-class service creates a fabulous atmosphere for your perfect holiday or successful business trip.

The Royal Square Hotel & Suites: Latvia’s Leading Hotel 2012!

2012

LATVIA'S LEADING HOTEL

ROYAL SQUARE HOTEL & SUITES

This certifies that the holder has been nominated in this category for the World Travel Awards 2012

3a Kalku Str., Riga, LV1050, Latvia, Phone: +371 67214 555, Fax: +371 67214 777 E-mail: info@royalsquare.lv, Web: www. royalsquare.lv