The overall opinion of local businessmen towards the existing business environment in Latvia showed signs of improvement last year, as reported by Turība University’s Faculty of Business Management dean Zane Driņķe on Wednesday, the 15th of February.
Available data from the university and SKDS indicates that the overall of Latvian businessmen about the business environment in the country has improved by seven points. While in 2021 the Turība Business Index value was at -23.3, last year this index improved to -16.3. Driņķe said that
the index has remained negative across five years of surveys.
She added that the government’s work was given a positive score by only 13% of interviewed businessmen. More than 50% viewed the work done by the government as disruptive towards businesses.
Businessmen were positive about certain aspects of the work done by the government, such as the speed at which business operations can be established, the general attitude from local governments and residents. The negative aspects mentioned by businessmen included the electricity market, labour force availability, administrative burden and regulatory instability related to business operations.
Turība University Faculty of Law dean Ivo Krievs reports that the business index regarding the influence of the work of the government on the legal environment was -29.2 last year, which is an improvement of 15.1 percentage points when compared with 2021, when this index was at -44.3.
Krievs reported that
54.4% of respondents said the government’s work was disruptive,
whereas 28.2% said the government neither interferes nor helps. According to him, this is a good score – if the government’s influence is unseen, it is good for businesses. Krievs also adds that the government’s work is viewed positively by large enterprises.
The general opinion from businessmen towards the administrative burden was at -35 last year, which is an improvement of 18.9 percentage points when compared with 2021, when this sub-index was at -53.9. A total of 23.3% of interviewed businessmen viewed the administrative burden as acceptable. 74.7% said it is excessive. Krievs said
the majority of businesses that consider the administrative burden as acceptable have foreign capital behind them.
According to the expert, this may mean that when compared with foreign countries, the administrative burden in Latvia is not as high.
The score for the legal environment was at -15.9 last year, which is an improvement of 20.7 percentage points when compared with 2021, when the value of the index was at -36.6. Krievs explained that this is the highest score given to this sub-index in the history of the university’s index. 46.4% of respondents described the legal environment as poor and 31.4% described it as good. The score here is better among large businesses as well.
As for stability of legislation and its predictability, the sub-index was at -40.5 last year, which is an improvement of 13.3 percentage points when compared with 2021, when it was at -53.8. A total of 76.5% of respondents described the legislative aspect in Latvia as negative. Only 20.3% it is positive.
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