Nine months after Latvia introduced the euro, the country has seen a number of benefits: the common currency has significantly lowers the international transfer fees and conversion fees, Latvia uses a global reserves currency which helps remove devaluation risks, the country’s rating has improved and it is now able to take part in the European Monetary Union’s decision process. The Bank of Latvia is also expecting other benefits in the foreign investment area.
An economic recovery is underway, despite recent developments in Ukraine. “Six years after the financial crisis we can finally say that the worst is over,” says Grzegorz Cimochowski, Lead Partner in Strategy Consulting in Central Europe, Financial Services Industry, Deloitte Central Europe.
Thousands living in eastern Ukraine are caught in the escalating conflict between government forces and Russian-backed separatists. With foreign retail companies, international trade going down and the devaluation of the hryvnia, the economic situation is worsening and the country is on the verge of bankruptcy. Continue reading Military neutrality in Ukraine is key to its economic growth
Insecurity in gas delivery from the East as well as the EU’s lowering carbon emission quotas have made Poland look to diversifying its energy sources. Hence, the multiple investments that the country has made and still plans to make to diversify energy sources and thus increase the country’s security.
For companies working within the aerospace industry, Avitation Valley in Mielec, Poland, is the place to be.
Companies like Yasa Motors Poland, set up in 2011, have already recognised the great potential of this cluster, as Managing Director Markus Müller says:
“The zloty fulfilled its goal in the time of that crisis but should there be another earthquake around Poland, being outside the Eurozone would be particularly dangerous for the country, its inhabitants and economy. Should we have another typhoon in Europe, similar to the one after the collapse of Lehman Brothers in 2008, we wouldn’t be able to survive even though we are part of the European Union because we’re not in the Eurozone,” says Janusz Piechociński, Poland’s Deputy Prime Minister and Minister of Economy.
Since the 14 special economic zones were set up across Poland almost two decades ago, the country has attracted foreign and domestic investments of more than €20 billion and created about 250,000 new jobs. Now, the government wants to update the areas included in the zones and attract as much research and development investment as possible.
As the Dutch Minister for Foreign Trade and Development Cooperation, Lilianne Ploumen, points out, trade relations between Poland and the Netherlands goes as far back as the late Middle Ages. Back then, Poland played a prominent role in the flourishing trade of our forefathers with several countries around the Baltic Sea.
Poland’s position in the newest World Bank’s Doing Business report may have improved but the country’s Deputy Prime Minister and Minister of Economy, Janusz Piechocinski, still identifies certain challenges for entrepreneurs, including the legal and tax systems, as well as existing relations between companies, courts and tax offices.
One never knows how things will develop, says James Roaf, Senior Regional Resident Representative of IMF, discussing changes on the CEE geopolitical scene with Why Emerging Europe, including Russia’s annexation of Crimea and CEE’s history of legacy risks. Roaf argues that it is imperative for countries of CEE to repair their fiscal policies through structural reform, dealing with high debt levels and controlling the exposure to unpredictable foreign investment in order to create a healthier business climate and better economy.