Latvia to lose 1 billion euro in Cohesion Funds

RIGA -- Latvia is poised to lose access to around 1 billion euros in cohesion funds under new proposals from the European Commission.

The proposals come as part of the EU multi-year budget plan, spanning from 2014-2020. The adjustments would entail that a cap on EU aid of 2.5% of national GDP - a significant drop from Latvia's current level of 3.8%.

“Latvia is not satisfied with current proposal, because it envisages reduction of the Cohesion Policy or EU funds financing to Latvia. Latvia also believes that the EC proposal does not ensure focused enough Cohesion Policy providing support to limited number of priorities allowing achieving more visible results,” said. Deputy State Secretary of the Ministry of Finance Aleksandrs Antonovs is a press release.

“Negotiations on issues related to future Cohesion Policy will be difficult, but Latvia will not be alone in its position, as was proved by the joint letter sent last week by prime ministers of the Baltic States and Hungary to the European Commission on unfair rules for distribution of Cohesion Policy financing among Member States," he said.

Latvia wants to improve effectiveness of the Cohesion Policy stating that Member States should report on achievements, rather than the amount of expenditure.

The finance ministry noted that "EU funding is the only considerable source of investment for development in Latvia".