The involvement of Latvian business community in the reconstruction of Ukraine and development cooperation grant projects, sanctions against Russia and Belarus, economic security, and EU trade policy were the main topics discussed during the meeting between the Latvian Chamber of Commerce and Industry (LCCI) and the Ministry of Foreign Affairs (MFA) on 27 June 2024.
The Minister of Foreign Affairs, Baiba Braže, underlined that the Ministry of Foreign Affairs maintains close ties and co-operates with Latvian companies and organisations in order to be up-to-date on current business developments and the pool of knowledge of specialists and companies in Latvia’s industries.
“We appreciate the LCCI as a cooperation partner. Working together with entrepreneurs and their involvement in development cooperation grant projects and public-private partnership are of strategic importance in the current geopolitical context. Economic security is as important a cornerstone of national security as military security, especially in the long term. No doubt, the involvement of entrepreneurs in grant projects is also an important factor for the security of our foreign policy and economy,” Baiba Braže noted.
In a discussion on the reconstruction of Ukraine, the Foreign Minister underscored that, in the state budget for 2024, EUR 5.4 million have been allocated for the reconstruction of Ukraine, and the funds will be used for rebuilding social infrastructure, psychological support projects, digitisation projects, spatial planning, as well as EU-related areas.
“The role of development cooperation grant projects has significantly increased – for example, a record high number of projects have been submitted under the 2024 grant project competition. Of the 11 projects approved, four are related to Ukraine in areas such as medicine (microsurgery), business support, machine translation, and strengthening human rights. The Ministry of Foreign Affairs will continue to involve Latvian businesses in the reconstruction of Ukraine – both by helping to build contacts and by informing them about projects funded by other donors,” Baiba Braže emphasised.
The Minister welcomed the continuation of the LCCI project in 2023–2024 to support small and medium-sized enterprises and civil society in Ukraine seeking to promote Ukraine’s integration into the EU. The project is supported by the MFA, with co-financing from the US Department of State. It should be noted that already back in 2021 and 2022, the LCCI ran an MFA-supported project for the integration of the Ukrainian small and medium-sized enterprises into the EU single market through transferring Latvia’s experience in implementing EU requirements, which also received co-financing from the US Department of State.
“We are currently working actively for development cooperation to contribute to Latvian exports, especially in the digital and IT sector. In July, we also intend to sign a Memorandum of Understanding with the United States Development Cooperation Agency, USAID, on cooperation on digital matters. At the same time, close engagement with the European Commission is underway in order to obtain accreditation for the Central Finance and Contracting Agency (CFCA) by autumn 2024 in the capacity of the Latvian Development Cooperation Agency, which will enable direct involvement in the absorption of EC development cooperation funding. The CFCA is already engaging in large-scale projects as project co-ordinator on the Latvian side, including in partnership with business-related NGOs,” Baiba Braže explained.
The Minister stressed that Latvia is one of Ukraine’s most active supporters.
Regarding sanctions against Russia and Belarus, the Foreign Minister said Latvia firmly advocates for the broadest possible and robust EU sanctions to reduce Russia’s military capabilities.
“Strengthening EU sanctions is an ongoing effort. It is in Latvia’s security interests to reduce economic dependence on Russia. The Ministry of Foreign Affairs consistently recommends to stop cooperation with Russia and get rid any kind of assets in Russia – given the minimal ability of the Latvian Foreign Service to protect the interests of Latvian companies in Russia,” Baiba Braže said.
She also called on Latvian manufacturing and exporting companies to pay increased attention to export partners in third countries in order to prevent Russia from obtaining goods used in the military industry. On earlier occasions, the MFA has met with several Latvian companies whose products had entered the Russian market through third countries. In order to maximise the uniformity of the implementation and application of EU sanctions, the MFA actively cooperates in the format of the Baltic States and NB8 by co-ordinating joint activities at the level of sanctions experts, financial supervisors and customs authorities.
The Minister emphasised that the Foreign Service has a number of effective instruments at its disposal – embassies abroad, representations in international organisations, the network of honorary consuls, cooperation with the representative offices of the Investment and Development Agency of Latvia – to support entrepreneurs, and the role of the Foreign Service is being increasingly activated to help pursue Latvia’s economic interests. Baiba Braže stressed that the MFA will continue working to strengthen the existing trade ties with EU and North American markets, Japan, Korea, Australia. Meanwhile, current priority in exports is to embrace the emerging and fast-growing markets, including Africa and Latin America. She also called on Latvian companies to make more active use of the opportunities offered by the Foreign Service.
The participants of the meeting also addressed the new Strategy for Human Capital Development (2024-2027). Latest events in the EU were then discussed.
