Latvia's Economic and Financial Outlook

EU Playing Key Role in Funding Structural Change in Latvia Efficient and well targeted absorption and use of EU funds will promote competitiveness and stimulate economic growth as well as support necessary structural reforms. Allocation Of EU Funds For 2014-2020 By Priority Axes 9% 11% 7% 2% 4% 4% 11% 12% 26% 14% ■Promoting sustainable transport and removing bottlenecks in key network infrastructures ■Protecting the environment and promoting resource efficiency ■Investing in education, skills and lifelong learning ■Supporting the shift towards a low-carbon economy in all sectors ■Strengthening research, technological development and innovation ■Promoting social inclusion and combating poverty ■Enhancing the competitiveness of small and medium-sized enterprises Enhancing access to, and use and quality of, information and communication technologies Promoting employment and supporting labour mobility ■Technical assistance Source: Ministry of Finance. EU Cohesion Policy Accompanies Structural Reforms The Latvian economy and the goals envisaged by the National Development Plan are strongly supported by well targeted and smart EU cohesion policy funds (EU funds like Structural funds and Cohesion Fund) and investments. EUR 4.4 billion EU funds are available for targeted and smart investments in Latvia within the 2014-2020 programming period across major nine priority areas with the general aim to enhance competitiveness of Latvia's economy and reinforce the country's solid foundation for sustained and smart growth. EUR 3.3 billion EU funds are already contracted for investment projects. • During 2007 - 2013 period Latvia has successfully completed the investment programme supported by EUR 4.5 billion Cohesion Policy EU funds (100% of EU funds <<envelope» for Latvia). Source: Ministry of Finance • • EU Funds After 2020 and Government's Support The European Commission has published a proposal for the new multiannual financial framework after 2020 in May 2018. The European Commission expects to start negotiations regarding planning documents of the framework in 2019. Initial European Commission proposal for Latvia's Cohesion policy allocation is 4.26 billion EUR (in 2018 prices). Allocation will be a subject of negotiations and Latvia will insist on bigger allocation. Latvia will remain eligible to receive support from all three Cohesion policy funds (Cohesion Fund, European Regional and Development Fund, European Social Fund). EU funds investment progress is transparent and can be followed: www.esfondi.lv 26

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