Latvian entrepreneurs successfully conquer new foreign markets

According to the data of the Central Statistical Bureau (CSB), the Latvian goods external trade turnover grew in April 2015 by 2.3% month-on-month, due to rises in export and import by respectively 4.5% and 0.5% month-on-month. Within a year, the export value of goods increased by 7.0%, but the import value of goods dropped by 1.4%.

In the first four months, goods exports rose by 2.5% year-on-year. The fastest growth rate in goods exports was maintained for various mechanisms and electrical equipment, construction materials, paper and cardboard products, textiles and textile products, plastic products and chemical industry products, whereas the greatest drop was experienced in the export of agricultural and food products..

In April, month-on-month growth was fastest in the export of optical equipment (owing to the export of various measuring devices to Russia, medical equipment to Belarus, breathing apparatuses and gas masks to the United Kingdom and Austria), base metals and their products (to Turkey, Algiers, Sweden), mechanisms and electrical appliances as well as chemical industry products (fertilizers) to Guinea. These data are a positive sign, given the hitherto close relationship of several sectors with the Eastern markets whose current economic situation is not very favourable. The export growth in above mentioned groups of goods points to the success of entrepreneurs in their search for new alternative markets.  

In April, the increase in the export of base metal products was also fostered by the largest enterprise in the sector "KVV Liepājas metalurgs", which resumed its work at the end of February. But, in view of the fact that the situation in metallurgy in Europe at large is still very difficult, metal processing has been stagnating for the past couple of years because of the low demand and weak market activity as well as because of the decision by "KVV Liepājas metalurgs" decision about reducing the production and laying off employees, it is difficult to predict what can be expected with regard to the metal processing industry and development of metal product exports. Month-on-month the fastest increases in goods exports have been to Russia, Estonia, Guinea, Turkey, Egypt, Portugal, and the United States.

In April, exports to Russia increased by 18.0 mil. euro month-on-month, mostly due to increases in exports of measuring devices, electric equipment generators, telephones, TV and radio equipment), vegetating plants, precious stones, and alcoholic beverages. In four months, export to Russia has decreased by 23.9% (or 74.7 mil. euro) year-on-year.

Month-on-month, goods imports remained practically unchanged in April, whereas year-on-year, the value of goods import dropped – by 1.4%.

On 4 June 2015, the Food and Veterinary Service received an official announcement from Russia to the effect that it is enforcing a ban on all Latvian fish product exports to Russia for an indefinite term. The ban is a "heavy blow" to the fish processing industry, for it will have an impact both on the catch and processing of fish, but it is not a lethal one.  Even before this ban, the exports of canned fish, including sprats, to Russia diminished last year and also in 2013, and this trend continued this year as well. The proportion of canned fish exports in total Latvian exports is tiny, around 0.7-0.8%. For several years, fish exports to Russia accounted for 0.3% of total exports, but this year, in the first quarter, it had dropped to 0.1%. The drop in canned fish exports to Russia was greater than the total drop in canned fish exports. That indicates that almost all fish processing enterprises have other markets outside of Russia and the customs union countries and new markets are found rather quickly. In May the Chinese Certification and Accreditation Administration gave an official permission to 11 Latvian fish processing enterprises to begin exporting their production to China. Thus both dairy (which received the green light for exports to China) and fish production exports have had new possibilities open for them. Even though Latvian producers will not have in China a 100% alternative to Russia, the Chinese market has a tremendous potential. Latvian producers can offer natural, ecological and quality production, which is in demand in China and not only there, for all around the world, consumers increasingly turn to healthy lifestyles and thus pay an increasingly serious attention to the quality of food.

APA: Pelēce, D. (2024, 24. apr.). Latvian entrepreneurs successfully conquer new foreign markets. Taken from https://www.macroeconomics.lv/node/1959
MLA: Pelēce, Daina. "Latvian entrepreneurs successfully conquer new foreign markets" www.macroeconomics.lv. Tīmeklis. 24.04.2024. <https://www.macroeconomics.lv/node/1959>.

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