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WEEK 29th 2004

Friday, the 16th of July, 2004

Latvia - the highest GDP increase in the EU
According to Eurostat, in the first quarter of 2004, Latvia has the highest GDP growth among the EU member states. The GDP in Latvia increased by 8.8 per cent during this time. The president of the Bank of Latvia, Ilmars Rimsevics, says that this growth is unexpectedly high and too rapid. Normal development would be 6 or 7 per cent.

Government to not increase minimal salary
Although the state and both the employers and employees had an agreement anticipating increasing minimal salary by LVL 10 each year till 2010, the government has decided not to increase the salary this year. Nevertheless the increase of the non-taxable minimum up to LVL 40 by 2007 is accepted. The Minister of Finance, Oskars Sprudzins, explains that it is not possible to increase both the salary and the non-taxable minimum because the government does not want to exceed the 2 per cent budget deficit.

Thursday, the 15th of July, 2004

Fictitious companies - like fish in EU pool
Last year, the state has lost LVL 104 million due to actions of fictitious companies. The EU accession provides new ways for deception with added-value tax (VAT). It has also become more difficult for police to control the actions of the companies. Now the fictitious companies can import and distribute different products for a low price without paying the VAT because the entrepreneurs can pay VAT when the products are already sold. The State Revenue Service claims that the number of these companies has decreased to 4,600.

Wednesday, the 14th of July, 2004

Statisticians count according to new scheme
According to Intrastat, in May the largest import partner of Latvia was the EU. 79.7 per cent of all the imports were from the union. The leaders are Germany (LVL 49.2 million), Lithuania (LVL 30.7 million) and Finland (LVL 22.2 million). The imports amounted to LVL 291.6 million in May. This is a decrease of 19.9 per cent compared to April. The exports amounted to LVL 174.6 million, a decrease of 1.1 per cent. 35.1 per cent of the exports were timber and wooden products. 81.5 per cent of all the exports went to the EU. Most of these goods went to England, Germany and Sweden.
Biznes & Baltija

Game's rules are clear at last
The management committee of the European Regional Development Fund has harmonized most of the business grant schemas of the Latvian Investment and Development Agency. Now the criteria for receiving EU co-financing are clear. The acceptance of the projects could start in July or August.
Dienas Bizness

Tuesday, the 13th of July, 2004

Income tax to be reduced to 12.5%
Latvian vice-PM Ainars Slesers announced that it is planned to reduce the income tax from 15% to 12.5%. Therefore, it will be the lowest income tax in Europe. According to Slesers, it will promote the development of Latvian companies and attract foreign investments. His proposal caused a discussion, during which high officials both criticised and praised this idea.

Monday, the 12th of July, 2004

Retail commodity turnover increases by 14%
According to the Central Statistical Bureau, during five months of 2004 the retail commodity turnover of Latvian enterprises increased by 14% in comparison with the same period of 2003. In May this index grew by 3.6%. Most of all or by 27% it increased in companies selling cars and car parts.

Transit supports economy
Latvian Ministry of Transport informed that in January-July 2004 ten Latvian ports shifted 29.583 million tons of cargo, which is by 2.3% more than in the same period of the last year. The three largest ports, Riga, Ventspils and Liepaja, shifted 28.98 million tons. Ventspils was the leader in this field. It was followed by Riga and Liepaja.

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