INVESTMENTS IN LATVIA

Sandra Jekabsone, Irina Skribane

Abstract


The effective attraction of investments to the national economy is a key factor, which provides favourable conditions to perform structural changes in the national economy, regional development as well as promotes technical progress. Therefore, investments in the public and the private sectors conduce development of the national economy and provide conditions to increase the overall competitiveness of a country. The purpose of research is to evaluate investment processes in Latvia before and after the global financial crisis, revealing investment-related problems. Also, to calculate the level of the desired investment, which would ensure the Latvia’s average GDP growth of 5% per year, according to the target set by the NDP. The analysis employs different qualitative and quantitative analysis methods, such as: scientific literature and empirical research analysis, modelling tables, charts and schemes, calculations of average and relative values, grouping, comparison and other. Publications on investment and research by Latvian and international scholars are analysed seeking to define the investment role on the economic growth process. The authors use the data available in the Central Statistical Bureau of the Republic of Latvia and Eurostat data bases, reports by the Ministry of Economics of the Republic of Latvia, the World Bank, the OECD and other studies of international organizations, as well as information provided in the Internet. As a result of research there have been defined the investment policy directions and essential obstacles that delay investment attraction in Latvia.

KEYWORDS: investments, investment gap, “optimal” level of capital, investment policy.

JEL CODES: E01, E22, E32, E60.

DOI: http://dx.doi.org/10.15181/rfds.v23i1.1680


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