Uncategorized – ActusQ SIA

LIAA Attracts EUR 655 Million in Investments in 2024

In 2024, the Investment and Development Agency of Latvia (LIAA) facilitated 45 investment projects with a total value of €655.4 million, creating an estimated 2,023 new jobs. The most significant projects this year focused on high-value-added manufacturing, information and communication technology (ICT), energy, and aviation industries.

“This has been a challenging year due to the geopolitical situation and the slow growth of our key external economic partners. However, despite these challenges, the volume of investments attracted is 6% higher than last year. This year, we reorganized LIAA and tripled the number of staff dedicated to investment attraction. Looking ahead, we aim to increase annual investment volumes to €1 billion within five years,” stated Laura Štrovalde, Deputy Director of LIAA. She added that LIAA’s current investment portfolio includes 166 projects with a total value of €10.8 billion.

Climate change has shifted investor priorities toward green projects, including renewable energy, circular economy initiatives, and sustainable production. This aligns with LIAA’s focus on knowledge-intensive sectors with broad economic impact. “We are open to working with any significant investment projects but will proactively prioritize sectors that contribute the most to economic growth, such as energy. Affordable green energy is essential for developing manufacturing and other industries, especially in light of EU and global emission reduction targets,” explained Ms. Štrovalde.

Key Investment Projects in 2024:

Asns Ingredient began constructing a pea protein isolate plant in Jelgava, with planned investments totalling €114 million.
Golden Fields Factory LV opened a protein production facility in Liepāja, investing €16 million to process 50,000 tonnes of pulses annually.
Tech Mahindra, a global technology company, established a representative office in Riga, creating 500 new jobs.
Norse Atlantic Airways, operating flights between Europe and the US, announced plans to open a business services centre in Riga and explore additional development opportunities.

LIAA’s Global Reach and Future Goals

Of the 45 projects implemented in 2024:Some projects were secured through LIAA’s economic representations abroad. LIAA currently maintains offices in 20 countries and plans to enhance its focus on investment results. Key target markets for investment attraction include Norway, Germany, Sweden, and the USA, each with two representatives. Additionally, new offices are planned for Spain and Indonesia in 2025. These decisions are informed by consultations with business organizations and analysis of Latvia’s foreign trade trends.

The coming year looks promising for investment attraction. As tariff wars between significant powers continue, Latvia is positioned to attract manufacturers who are hesitant to expand into Asia due to increasing risks. In the US, companies looking to grow in Europe also present opportunities. Furthermore, municipalities are developing industrial parks to foster inward investment. Overall, 2025 is expected to bring moderate economic growth to Latvia, sending positive signals to investors.

Focus on Large-Scale Projects

“This year, we worked on several large-scale projects, including the biorefinery Fibenol in Valmiera and the Elwind offshore wind farm. Other notable ventures include the Fokker Next Gen hydrogen-powered aircraft project. To manage these efforts, we plan to divide our team’s focus: some specialists will proactively seek new clients, while others will concentrate on supporting ongoing projects and companies already operating in Latvia. Currently, 60-70% of investments come from businesses already established in Latvia,” noted Ms. Štrovalde.

Geographic and Sectoral Distribution of Projects

Of the 45 projects implemented in 2024:

21 are located in Riga,
3 in Riga Region,
12 in Kurzeme,
4 in Latgale,
3 in Vidzeme,
2 in Zemgale.

Key sectors represented include:

ICT (11 projects),
Bioeconomy (9 projects),
Smart energy (7 projects),
Photonics and smart materials (7 projects),
Biomedicine (2 projects),
Other sectors (9 projects).

LIAA aims to attract €1 billion in investments between 2023 and 2025, creating 7,500 new jobs. For 2025, the agency has set a foreign investment target of €790 million, underscoring its commitment to driving sustainable economic growth in Latvia.

Information source: Investment and Development Agency of Latvia

From 2025, the Agricultural Data Centre’s tasks will be taken over by the Rural Support Service

Starting from January 1, 2025, all the services previously provided by the Agricultural Data Centre (ADC) will be delivered by the Rural Support Service (RSS).

No changes will be introduced to the range of paid services, and clients will continue to have access to all existing systems and registers. The procedure for animal registration, as well as the European Union’s requirements for the registration and identification of animals, will remain unchanged.

This decision was made to establish a unified system, ensuring simplified and flexible oversight of the agricultural sector while reducing the fragmentation and overlap of state administrative functions.

The consolidation of functions under the institutions subordinate to the Ministry of Agriculture will facilitate faster exchange of information between institutions and private individuals, thereby improving and simplifying services provided to the public and enhancing their quality. Since RSS has nine territorial units – regional agricultural administrations – farmers will continue to receive the necessary services in their regions.

RSS will also adopt the practices of previous years, ensuring that farmers can order and receive animal identification tools. Additionally, RSS will represent national interests in international organizations overseeing and evaluating agricultural animals, including the International Committee for Animal Recording (ICAR) and the Interbull Centre for the evaluation of breeding bulls.

A commission established by the Ministry of Agriculture will ensure the inventory of ADC’s material and non-material assets, financial resources, and obligations by December 31, 2024, as well as the transfer of archives and record-keeping to RSS. Changes related to the reallocation of funding between institutions will be carried out within a single state budget sub-program. The commission will also assess the number of personnel to be transferred from ADC and prepare the ADC’s closing balance sheet.

Source of information: Rural Support Service

Increased support rate in agri-environmental measures for organic farmers and grassland habitat managers

On December 10, Latvian government approved amendments to the regulations governing support from the European Agricultural Fund for Rural Development (EAFRD) for implementing area and animal-based commitments. These amendments increase the 2024 support rates for organic farmers in two agri-environmental measures – LA10.4 and LA11 – as well as for all those managing biologically valuable grasslands under measure LA10.5.

With the rate increase*, farmers who implemented interventions LA10.4, LA10.5, and LA11 in 2024 will have their support recalculated. As a result, the total support amount they receive will be higher than initially planned in the spring.

Since the Rural Support Service has already started distributing EAFRD payments for area- and animal-based support, the support rates for farmers’ 2024 spatial applications will be recalculated by the end of December. This recalculation will include the increased rates and other additional adjustments.

* The decision of the European Commission approving amendments to Latvia’s Common Agricultural Policy (CAP) Strategic Plan for 2024.

Information source: Ministry of Agriculture

LATRAPS’ first public bond issuance successfully concludes, with demand exceeding by 50%

One of the largest grain exporters in the Baltics, LATRAPS has successfully raised €8 million during its public bond offering with a fixed interest rate of 7.5%. The total demand for the bonds exceeded initial expectations, reaching more than €12 million, surpassing the initial bond offering target by 50%.

Interest from both retail and institutional investors has been strong since the publication of the Information Document, emphasizing the strength of the agricultural sector and the potential of the ASNS Ingredient project in the Baltics. Over 300 private and institutional investors took part in the public bond offering. In terms of investment volume, Latvian investors made up to 90% of the total demand.

Roberts Strīpnieks, Chairman of the Board at LATRAPS, commented: “The results of our first public bond offering reflect the community’s interest in participating in the development of the agricultural sector and in strengthening Latvia’s name on the global economic map, for which I am grateful to every investor. From today, not only the 1220 members of LATRAPS are involved in this important process, but also more than 300 investors. I am pleased that the goal of this issuance is ambitious and tangible for all of us together – to build the largest pea protein isolate factory in Northern Europe, ASNS Ingredient, where construction is planned to start this month.”

“LATRAPS example illustrates that an issuer with a good reputation, solid financial performance and well-developed growth plans is not only able to attract significant interest from institutional investors, but also motivates an increasing number of Latvian private investors to start their investment journey in bonds. We are happy to see substantial interest from Latvian investors, as every LATRAPS bond investor will help the issuer implement one of the largest investment projects in Latvia in recent years,” assessed Kristiāna Janvare, Head of Investment Banking at AS Signet Bank.

Estonia’s largest farmers association, KEVILI, also expressed its views on the LATRAPS bond offering: “We are proud of our Latvian colleagues and fully support them in this public bond offering. We see it as setting a bold example for other farming associations in the Baltics, including KEVILI. Agriculture, especially the cultivation of grains and rapeseed, is an area where we have much in common to strengthen our cooperation. Estonian farmers will take the opportunity to supply peas to the new ASNS Ingredient facility, thereby fostering the growth of agricultural exports from our region and enhancing the global recognition of the whole Baltic agricultural sector.”

As demand for the bonds significantly exceeded the issuance volume, the allocation to investors is made according to the principle of proportionality, aiming to establish a stable, diversified, and reliable investor base.

Following the bond issuance, LATRAPS will submit an application to Nasdaq Riga for the listing of the bonds in the Nasdaq Baltic First North alternative market.

The bonds will be settled on December 12, 2024. Bondholders will receive quarterly coupon (interest) payments, with the first coupon payment being made on 31 March, 2025.

The arranger of the bond issue is AS Signet Bank, while legal advice is provided by the law firm TGS Baltic.

Information source: Latraps

Results of agricultural land inspection in 2024

The Rural Support Service (RSS) has conducted an inspection of agricultural land areas to determine whether the land is being maintained in good agricultural and environmental condition. Agricultural land is considered to be in good agricultural and environmental condition if, by September 1 of the current year, it has been mowed at least once, and the grass has been harvested or shredded and dispersed.

This year, RSS inspected 2.2 million hectares of agricultural land, of which 1.99 million hectares were maintained areas, while the remainder were classified as unmanaged.

The results of the 2024 agricultural land inspection are available on the service’s website (https://karte.lad.gov.lv). This information helps landowners assess the condition of the land they own.

The inspection utilized satellite imagery data as well as results obtained through on-site surveys.

The Rural Support Service reminds landowners that at least 70% of the agricultural land registered in the cadastre must be maintained for it to be considered managed. If RSS determines that agricultural land is uncultivated or unmanaged, the local municipality imposes an additional real estate tax rate. Additionally, if the unmanaged agricultural land is declared for area payments, support amounts are reduced accordingly.

Information source: Rural Support Service

Change of ActusQ office opening hours over Christmas holidays

We inform you that employees of Ltd “ActusQ” are going on Christmas holidays from December 23 to January 5. We will resume working in usual working mode on January 6, 2025.

Wishing you a Christmas brimming with joy and the magic of cherished moments. May your New Year 2025 shine with boundless opportunities, heartfelt moments, and accomplishments to be proud of!

ActusQ Newsletter November 2024

ActusQ November newsletter about current topicalities in European and Latvian agricultural sector has been published! At the end of the newsletter you will find selected agricultural real estate offers.

View as PDF file

Amendments to the Strategic Plan of the Latvian CAP 2023-2027 approved by the EC simplify the application of support payments to farmers

On November 12, the European Commission (EC) approved the Second Amendment to the Strategic Plan of the Common Agricultural Policy of Latvia (CAP SP) for 2023-2027 developed by the Ministry of Agriculture. The main changes concern the application of direct payments and rural development interventions, simplifying conditions and avoiding excessive detailing of requirements.

The CAP SP revises a number of provisions of good Agricultural and environmental condition (GAEC) standards, specifying them for the protection of wetlands and peatlands, the establishment of buffer strips along water bodies and plant changes. Simplified conditions for the grant of multi-ecoscheme support in order to reduce the administrative burden on farmers by avoiding excessive detailing of CAP SP requirements. The conditions for a system of social conditions relating to working and employment conditions or to the obligations of the employer have been laid down. Changes to direct payment measures (interventions) will apply from 2025 onwards.

The CAP SP also specifies the conditions for a number of rural development measures. For more information on the amendments approved by the EC, visit website of the Ministry of Agriculture.

For the implementation of the CAP SP, EUR 2.5 billion is foreseen for 2023-2027, with the largest part of the funding, or EUR 1.714 billion, in the form of direct payments. EUR 0.791 billion is foreseen for rural development measures and EUR 10.1 million for support measures for the common organisation of the market.

Amendments to the CAP Strategic Plan were prepared by experts from the Ministry of Agriculture in cooperation with industry, organising several CAP expert working groups in the first quarter of 2024. At the meetings, experts discussed and agreed on the necessary amendments together with farmers’ and environmental non-governmental organisations. The amendments to the CAP SP on 14 May 2024 were also agreed with the monitoring Committee of the CAP Strategic Plan 2023-2027.

The Latvian CAP SP is a medium-term policy planning document that defines support priorities and support instruments for agriculture and also rural development. After the first year of implementation of CAP support, it was concluded that changes to a number of support measures were needed to reduce the level of detailing of conditions in the CAP SP and the administrative burden on farmers and to increase the interest of farmers in applying for a wider range of support.

Information source: Ministry of Agriculture

Latvenergo acquires large-scale solar park in Dienvidkurzeme Municipality from Danish Sun Energy ApS

We are happy to announce that a large-scale solar project with a total capacity of 265 MWp has entered its next milestone of development. Latvenergo AS, Latvia’s leading energy company, has acquired this ready-to-build solar project from Danish Sun Energy ApS to be constructed in Latvia, South-Kurzeme Municipality (Dienvidkurzemes novads) during year 2025.

ActusQ has been long standing strong consulting partner on local issues to Danish Sun Energy ApS to help to bring the project into a ready-to-build phase. Thanks to all team members and cooperation partners, and thank you, Danish Sun Energy ApS, for trust and endurance through challenges!

More information HERE.

ActusQ Newsletter October 2024

ActusQ October newsletter about current topicalities in European and Latvian agricultural sector has been published! At the end of the newsletter you will find selected agricultural real estate offers.