Therefore, this year and in the following two years state budget resources will primarily be invested in the initiatives that will not be funded from EU funds and will have a long-term effect on strengthening economic security – measures that will enable our companies to become stronger, develop faster and create well-paid jobs,” the Minister of Economics Ilze Indriksone continues.
The priority measures of the state budget of the Ministry of Economics this year are investments to promote growth, competitiveness and access to finance of enterprises, development of innovations and commercialisation of science, improvement of the human capital and employment management model, development of the ecosystem of the start-up sector, as well as improvement of accessibility and quality of housing.
In 2023, EUR 12.19 million will be channelled for the promotion of growth, competitiveness and access to finance of enterprises. The main activity in this area is the continuation of operations of the Investment Fund. A total of EUR 70 million are provided for investments in the development of large export-oriented projects of entrepreneurs important for the economy – EUR 10 million in 2023, EUR 30 million per year in 2024 and 2025. Within the framework of the funding granted this year, it is also planned to support 10-11 large investment projects, creating at least 600 extra well-paid jobs, increase the amount of investments of enterprises in research and development – ~ EUR 10 million per year and achieve additional export volume growth – EUR ~ 70 million per year. Overall, within the framework of the funding granted in the programme, which will reach more than EUR 222 million, it is planned to support 32-33 large investment projects, creating 2000 new well-paid jobs, increase the amount of investments of enterprises in research and development – ~ EUR 30 million per year and achieve export volume growth – EUR ~ 500 million per year. At the same time, this year, EUR 2.19 million is intended for the provision of export transaction insurance services to Latvian companies providing support for export transactions for EUR 200 million.
In 2023, additional funding of EUR 2.87 million is provided for fostering innovation, the contribution of science to the economy and human capital development. EUR 2 million are intended for the further development of the Innovation Fund initiative early-stage research projects with commercialisation potential, while EUR 4 million per year are expected to be allocated to this objective from the state budget also in 2024 and 2025. Innovation Fund initiatives have already started at the end of 2022 and, currently, two projects have already been supported, each amounting to EUR 5.7 million with the implementation period until 2024. One of the projects supported is implemented in the field of smart specialisation “Biomedicine, medical technologies, pharmacy” and the other in the field of smart specialisation “Photonics and smart materials, technologies and engineering systems”. The additional funding provided for 2023, 2024 and 2025 is intended for embodying the project approach that would enable long-term planning of project funding, as well as the possibility of setting up project consortia or platforms, using flexibility in selecting the most appropriate sub-projects to achieve the national and mission approach based objective set for the consortium.
To improve the human capital and employment management model by promoting growth and export capacity of Latvian enterprises, ensuring highly skilled and professionally prepared labour force, EUR 675.3 thousand is planned this year, while EUR 759.8 thousand in 2024 and EUR 844.3 thousand in 2025. Within the next 3 years, it is planned to introduce a human capital matters management model, develop a National Human Capital Development Strategy and ensure monitoring of graduates of lifelong learning training programmes.
Innovative start-ups that are able to grow rapidly into exportable companies are important for strengthening the Latvian economy. Additional EUR 200 thousand will be directed to the development of the ecosystem of the start-up industry, within the framework of which it is planned to provide analytics of the Startup database, organise the Startup Day & Startup Awards, TechChill 2023 – Baltic leading three-day conference, Startup BBQ, ecosystem education/networking activities, hackathons, implement the Office hours mentoring programme, popularisation of the image of Latvia abroad, attraction of foreign investors and media attention, Business Angels training, provide monthly consultations and investment sessions, innovation ecosystem workshop, as well as organise activities of the Latvian private and venture capital association for improvement of qualification of local funds and promotion of interest of potential investors in these funds.
To improve accessibility and quality of housing, the Saeima supported the provision of additional funding for the continuation of the housing guarantee support programme and the support programme “Balsts” – in the amount of EUR 3 million this year, while EUR 3.6 million in 2024 and 2025 each year. As it is known, these support programmes implemented by Altum provide adequate housing for families with children, reducing the amount of the first instalment to get a home loan. As part of the programmes, 1,500 families with many children are expected to be supported over the next three years, with “Balsts” subsidies, as well as more than 6,000 families with children by granting them guarantees.
However, EUR 2.33 million is planned this year, while EUR 2.6 million annually in 2024 and 2025 for the further development of the Construction Information System (CIS) and the modernisation of services. CIS functionality is constantly developed and supplemented. As of October 2019, CIS ensures the full digital circulation of the construction process documentation, thus bringing Latvia forward among digital leaders of the industry in Europe. Last year, the functionality was developed to ensure the operational processes of a building and to manage buildings. To improve the quality of construction control, it is possible to browse three dimensional building information models (BIM). To improve the process of management of residential houses, ensure fair competition conditions for managers, as well as free and secure storage and availability of the documentation of apartment owners on the operation of the house in one place, the functionality of the House file has also been developed. Over the next three years, the development of CIS is expected in three main directions – automation of construction processes, improvement of CIS usability and promotion of quick functioning of CIS.