Investment agency in Latvia aims for a prosperous year ahead
In a bid to attract more investment and boost its economy, Latvia is focusing on knowledge-intensive and green projects, particularly in the sectors of bioeconomy, renewable energy, and Information and Communication Technology (ICT).
The Indian company Teh Mahindra has recently opened a business services center in the Baltics, with a potential team of 500 employees. This move is a testament to the growing interest in Latvia as an investment destination.
Andris Bite, President of the Confederation of Latvian Employers, has emphasized the need for proactive efforts to attract more investment. Bite's suggestions imply a more active and targeted approach, with a focus on personal engagement and persuasion to attract investment. He suggests identifying countries, directions, companies, or entrepreneurs and approaching them to draw investment into Latvia.
One of the sectors that Latvia is actively investing in is bioeconomy. While no specific large-scale pea protein plant investment in Liepaja or Kurzeme was detailed, Latvia's overall strategy strongly supports bioeconomy and biotechnology. The Latvian Investment and Development Agency (LIAA) promotes projects in biomedicine and biotech in cooperation with research institutes, aiming to incubate startups that can scale up with venture capital.
Latvia has relatively stronger investment and employment in ICT compared to other innovation indicators. ICT specialist employment and cloud computing adoption are improving substantially, supported by government programs focusing on increasing ICT sector employment. This suggests active investment and development in smart digital technologies.
Renewable energy investments are a priority, with projects like the Elwind offshore wind farm and planned photovoltaic parks highlighted as flagship initiatives. Such projects contribute to the smart energy transition and green economy focus of the region.
Biomedicine is explicitly mentioned as a key sector for investment, backed by LIAA's cooperation with research institutes and support for startups in this field. Although Latvia’s overall R&D and venture capital investment remain below EU averages, this sector is a strategic priority.
Latvia is improving its foreign investment framework with simplified procedures, export councils for sectors, and enhanced aftercare measures to attract knowledge-intensive and green investments. Investment volumes have modestly rebounded from historic lows recently, with forecasts suggesting significant growth in 2026 and 2027.
Notably, 70% of incoming and outgoing investments in Latvia come from investors who have already invested in the country. Last year, 45 investment projects were launched with the participation of LIAA, totaling EUR 655 million. LIAA plans to introduce investor after-sales service to increase the volume of investments. After-sales service is a new model being introduced by LIAA to increase investments in Latvia.
In addition to Mahindra, a Lithuanian capital company has invested €80 million in Liepāja to produce smoked salmon products. The Norwegian representation established the Norse Atlantic Airways business services center in Latvia, further demonstrating the country's attractiveness to foreign investors.
Bite believes each municipality should have specialists who actively work on attracting investors. The main investment attracted was in Rīga and its vicinity, but Kurzeme stood out among the regions. The focus is on drawing in investors who may not have initially considered investing in Latvia, particularly from Western and Northern Europe.
With growth forecast in Europe this year, including in neighboring countries and Germany, which are Latvia's main export markets, the country is well-positioned to capitalize on these trends and attract more investment in the coming years.
References: 1. Latvijas Investīciju un attīstības aģentūra (LIAA) 2. European Commission, Digital Economy and Society Index (DESI) 3. Latvijas Banka, Investīciju attīstības indicators (Investment Climate Indicators) 4. Latvijas Banka, Investīciju attīstības indicators (Investment Climate Indicators) – 2021
- The Indian company Teh Mahindra, having opened a business services center with a potential team of 500 employees in Latvia, signifies a growing interest in the country as a destination for finance and business, particularly in sectors like renewable energy and ICT.
- The European Commission's Digital Economy and Society Index indicates that Latvia has a relatively stronger investment and employment in ICT compared to other innovation indicators, suggesting active investment and development in smart digital technologies.
- Andris Bite, President of the Confederation of Latvian Employers, underscores the importance of personal engagement and persuasion to attract investment, suggesting that Latvia should identify countries, directions, companies, or entrepreneurs and approach them to draw investment into sectors like bioeconomy and biotechnology, which are strategic priorities for Latvia.
