If Latvia wants to meet the rising expectations among its citizens for better public services, such as health, education, and transportation, it should consider increasing revenues through improving its taxation system, according to the World Bank.
The forthcoming report, which will summarize the findings from a year-long review, finds that tax revenues in Latvia are lower than in many similar countries, while social inequality remains higher in comparison to many European Union (EU) countries. The tax revenue to GDP rate in Latvia, at some 29 percent, in one of the lowest in the EU – 10 percentage points below the EU average and about 5 percentage points below the Organization for Economic Cooperation and Development (OECD) average.
To combine efforts in the fight against the grey economy, corruption and other fraudulent activities affecting the state budget and the overall welfare of the society, the state administration implements the social information campaign also known as the anti-fraud movement – #FraudOff! The long-term goal of the movement is to achieve a zero tolerance of the population towards the fraud in our country.
On Monday, January 30, Japanese credit rating agency R&I changed Latvia`s credit rating outlook to positive from stable. R&I has affirmed the Foreign Currency Issuer Rating at BBB+.
On Tuesday, 10 January, the Cabinet of Ministers approved the Latvian Anti-Fraud Coordination Service (AFCOS) operational strategy of the Ministry of Finance (MoF). It provides that the public administration institutions involved in the AFCOS network will unitedly fight against fraud in the field of the European Union (EU) funds, thereby increasing efficiency of protection of interests of the EU taxpayers.
Minister of Finance, Dana Reizniece-Ozola, has been recognised as the best Minister of Finance of 2017 in the European region. The high rating has been granted by the international business and financial publication The Banker by appreciating the work done for stabilisation of the financial situation of Latvia and promotion of growth.
After a comparatively strong growth in 2015, when the Latvian economy was able to demonstrate a solid stability in light of the shocks of external environment, the economic growth in 2016 slowed down by 1.4% (in the first three quarters of the year). This was largely due to continuously unfavourable situation in the external environment, as well as a slower introduction of the resources of the European Union (EU) funds, in light of the change of the fund planning periods.
To raise the level of knowledge of the public administration auditors and strengthen the professional international partnership, the Ministry of Finance, as the internal audit coordinator, on 19 and 20 December organised the bilateral Latvian -Norwegian experience exchange seminar for internal auditors "Effective Governance and Efficiency Audit in the Norwegian Government Administration".
On Tuesday, December 20, at the Cabinet of Ministers meeting the informative communication on launching the official bilateral negotiations for the implementation of the European Economic Area (EEA) and the Norwegian Financial Mechanisms in Latvia for the period 2014 - 2021 was reviewed. The gross allocation to Latvia during the said period of time within the scope of both financial mechanisms comprises 102.1 million euros, with approximately 20 million euros whereof being designated in accordance with the approved implementation framework (administrative costs of the Donor States, mandatory 5% reserve, fund for promotion of bilateral cooperation, technical assistance, mandatory NGO fund, etc.), whereas 80.2 million euros are to be allocated to the introduction of the investment programmes.
On Friday, November 4, the international credit rating agency Fitch Ratings has affirmed Latvia's Long-term foreign and local currency Issuer Default Ratings at 'A-' with Stable outlook.
On Friday, September 30, due to the favourable conditions in the international capital markets, Latvia issued a new 10 year bond amounting EUR 650 million. The coupon was set at the historically lowest level 0,375% (yield 0,456%). Demand for Latvia’s new bonds exceeded 2,6 times the issuance size.