President of Latvia Egils Levits met with Mārtiņš Kazāks, Governor of the Bank of Latvia, met today to discuss the development in national and global economy. President and Governor both underlined the importance of financial sector’s response to continued recession at the beginning of this year, i.e., various steps to be taken by the financial sector to strengthen and support Latvian economy, such as wider access to credits, less obstacles and more competition among financial institutions.
Bank of Latvia forecasts continued recession early this year, but it will not last long or have deep impact. Economic downturn will be driven by weakening household purchasing power as wages will rise significantly slower than inflation.
Egils Levits and Mārtiņš Kazāks also discussed envisaged increase of minimum monthly wage this and next year. President of Latvia and Governor of central bank both underlined that government should agree on the minimum wage increase principles based on structural interventions rather than political negotiations.
Meeting also focused on productivity or business efficiency, and how to raise productivity to make Latvia the economic champion of Baltics once again. According to Governor Kazāks, investments in the human capital – health and skills of people – and comprehensive strategies for attracting as much EU investments as possible should allow Latvia to achieve this goal.
In conclusion, both officials discussed the importance of expanding national capital market, encouraging residents to invest in local companies and thus generating finance for their growth. More lively capital market would improve the overall business environment in Latvia and governance of public companies.
