What's next after the EBRD and the Baltic biz conference?

RIGA - At the end of May the flowers were in full bloom, music filled the squares of Old Riga and there were thousands of bankers, businessmen and financial experts walking around. Riga played host to two annual European business conferences, the European Bank of Reconstruction and Development's annual meeting and the concomitant Baltic Business Conference. One topic of discussion at both of these was the continued development of foreign investment in the Baltics.

"Overall investment plans and regional development are the key topics at this year's EBRD meeting," said Roberts Zile, the EBRD's Governor of Latvia. "Latvia is looking to keep up globally with long term investment as its main goal."

Speakers and participants took part in an overall view of what needs to be done keep steady foreign investment in the Baltics. Their conclusion is strategic development.

"The EBRD and BBC were a culmination of two years preparations to show Europe at what stage of development Latvia has reached," said Viktors Kulbergs, the president of the Latvian Chamber of Commerce and Industry. "The conferences were not only important for Latvia but for the Baltics. We needed to show Europe where we are on the map and that we are here to stay."

Monty Akesson, the president of the Foreign Investment Council, said the businessmen who visited Riga did not know how much Latvia had developed since its independence and its recovery after the Russian crisis in 1998.

"Latvia has recovered fully from the Russian crisis. This result can be attributed to foreign investment. Steady economic growth is the outcome of investments in Latvia," said Akesson.

The Ministry of Economy made general summaries of how the ministry is enticing foreign investors to Latvia and what their plans are for the future.

"The ministry presented their joint strategy with the Latvian Development Agency to develop high tech, information technology and chemical industries," said Kaspars Paupe, ministry spokesman. "After the wrap up of the privatization process at the end of this year, overseas investments will slow down. Strategies need to be placed to attract more investment. The end of privatization is a concern to the government."

Kulbergs said it is very good that privatization will soon be finished. Politicians will be able to get on with politics and leave the business to businessmen.

How foreign investors can benefit the Latvian economy was a keynote at the BBC. Akesson said if Latvia can keep attracting overseas investments, preparations can be made for the future.

Kulbergs, a speaker at the BBC, said Russia is a large bottle and the Baltics are the bottleneck. Being the bottle neck Latvia can join East to West and vice versa.

"We need to keep the flow of foreign investment. Development of our local industry through investment will benefit our economy," Kulbergs said. "Latvia can then be ready when 'the giant bear' Russia wakes from its slumber in around 8-10 years time."

Akesson said Latvia needs to prepare itself for the future when Russia will become an economic force.

"Foreign investment in Latvia is very good. There is a high amount of investment here compared to other Eastern European countries," said Akesson. "Brains need to be used to bridge the West to Russia through Latvia.

"The investments are slowly moving from natural resources to financial, information technology and human resources. Latvia needs to keep developing these areas to keep foreign investment capital," he said.

Country and company representatives at the BBC spoke about the direction Latvia and the Baltics need to go to keep overseas investments flowing into the region. The main challenge is to proceed with a purposeful strategy for direct foreign investment.

"It is vital the government starts its proposed tax law and subsidy amendments so investors find the business climate here attractive," said Paupe.