The Foreign investors council in Latvia (FICIL) held an online meeting with the Prime Minister of the Republic of Latvia, Mr. Krišjānis Kariņš, on Thursday 3rd of March to discuss the ongoing military conflict in the region, as Russia’s invasion of Ukraine began on the 24th of February, 2022.

Chairperson of the FICIL Board Zlata Elksniņa Zaščirinska (PwC) opened the meeting with comments on the ongoing conflict in the region and reassured that businesses are very focused on providing all the help they can to Ukraine and Ukrainian people that they can at this moment, including donations of funds and supplies needed.

Prime Ministers Kariņš reiterated NATO commitment to defend Latvia as it is a member of NATO, as well as informed FICIL Board on the additional measures taken by the Alliance to strengthen NATO’s Eastern Block  with additional soldiers and equipment. It is important at this point for the society of Latvia and business community to remain calm and trust in the information coming from the public sector in Latvia.

Investors outlined the energy dependency on Russia as a major concern going forward. Prime minister Kariņš spoke about this aspect emphasising that this in an understandable concern taking into account that energy prices were a driver for inflation even before the start of war in Ukraine. Now there is a greater demand for development in renewable energy sector, with the aim to minimise the imports from Russia. However, there is no quick solution, but the work is underway, for one Mr. Kariņs emphasised that the Government supports the development of wind parks. Also, the Government will implement additional measures to assist households in their transition towards green energy, more specifically facilitating the transition of residential houses from gas heating to heating using renewable energy resources.

Regarding sanctions that are in place, Mr. Kariņš said we have to understand that “when we bite the economy of Russia, they will bite back”. FICIL Board members commended the positive impact that the so-called financial sector overhaul in Latvia will have on the economy, since we realise the effect of the sanctions could have been larger for the economy of Latvia, if not for the reforms carried out in recent years.

Another issue that was discussed was related to integration process in Latvian society. Prime Minister Kariņš spoke on the necessity for the Latvian people to be more unified, and the need to avoid fostering any ethnic division. We all support democracy and peace in this situation. It is clear that Latvia will not be able to achieve in  a week what we have not been able to achieve in the last 30 years. Lastly, the Prime Minister stated that we need to focus on building a unified society and also welcome Ukrainian asylum seekers as part of  our society. We must avoid implementing any radical policies and work to de-radicalise parts of society.