Economics Ministry working on solutions for additional support to tourism industry

  • 2020-10-06
  • LETA/TBT Staff

RIGA - The Ministry of Economics is working on solutions to provide additional financial support to tourism entrepreneurs to continue their business, Evita Feldberga, a representative of the Ministry of Economics, told Latvian Radio on Tuesday.

She pointed out that the ministry has listened to the proposals of tourism industry entrepreneurs regarding necessary support, and is working on them, thinking in the long run, not only for the crisis period.

Feldberga also noted that the contribution of the existing support instruments, namely the grant available to companies in the amount of 30 percent of the paid labor taxes during the year, is being assessed.

"We listen very much to the industry. The plan is to work with the tourism industry during the winter months, when the situation may worsen," said a ministry spokeswoman, saying the support measures should be designed to suit businesses in different sectors.

Inga Kavaca, chairwoman of the board of the Latvian Association of Travel Agents and Operators, noted that currently no information has been gathered on how many tourism companies plan to close down, but there will be such companies. Currently, the decline in turnover for tour operators and agents is measurable at 98 percent, while the annual decline in turnover could be 90 percent compared to the previous year.

She predicted that with the existing support - a grant to subsidize the salaries of employees - tour operators will be able to survive until the end of October. If state support does not continue, liquidations of tour operators are expected at the beginning of 2021.

"If we can't work now - when?", the head of the association said, adding that clarity is needed about travel outside of Latvia.

At the same time, the President of the Latvian Hotel and Restaurant Association Janis Naglis admitted that both the Ministry of Economics and the Ministry of Health have come up with valuable and logical proposals, but they are being implemented too slowly.

He also stressed that large hotels depend on state support, because "it will not be enough for hotels to survive this period until June 1 of next year, when the active tourist season could resume''.

Naglis pointed out that if the "Baltic bubble" was restored, it would help to survive the crisis a bit better.

Asnate Ziemele, the head of the Latvian Rural Tourism Association, said that compared to international tourism, rural tourism has suffered the least. The reason for this could be that rural tourism has always been oriented towards local tourists.

Despite the fact that rural tourism was stable during the summer period, Ziemele noted that concerns about whether demand will be as good in the future have not disappeared. She said that rural tourism is frightened by the fact that the Latvian economy may not be doing so well, which could significantly reduce the demand for tourism services.