RIGA, Jan. 9 (Xinhua) -- The Latvian economy's performance during the COVID-19 crisis has been "acceptable" on the whole and the Baltic state has been doing better than many other countries, according to Andris Vilks, a member of the Council of the Bank of Latvia Council and former finance minister.
While the pandemic has brought about serious problems, it also created new opportunities and highlighted long-neglected issues in many sectors of the economy, Vilks told the Latvian news agency LETA on Friday.
Using funds from the European Union (EU) and its national budget, the Latvian government has created a number of support instruments to help the country's economy survive the coronavirus crisis, he said. These include downtime and wage subsidies, working capital grants and rent discounts to businesses.
Vilks believes that the recovery funds currently available to Latvia must be used more actively to transform the economy so it can get off to a strong start as soon as the world opens up again.
"At present, the downturn is deeper than earlier expected. But the economy is flexible, and we see that many industries, many businesses have even managed to improve their results," he said.
Companies are regrouping and modernizing, and the country's export results are surprisingly good, Vilks said, adding that once the pandemic is over and the economy reopens, Latvia will be in a good starting position.
However, the pandemic has also highlighted numerous problems that have been plaguing the Latvian economy for years, like shadow businesses, low public trust in state authorities and an excessively complicated tax code, Vilks said.
Latvia has so far been too slow to absorb the money available through the European and national support programs, he noted, saying it would hamper economic recovery and leave the country lagging behind its neighbors.
Another serious problem is that too little of the money that is currently being injected into the economy reaches the people and households, he said.
Furthermore, Latvia needs a much clearer focus and more specific targets when it comes to the use of EU support funds, Vilks said.
"COVID-19 has brought an entirely new way of thinking in society and also in business," he said. "Most people will keep working from home also in the future. Therefore, if we want to develop our territory, we need to ensure connectivity. As the reforms are being made, money must follow projects. I am therefore not pessimistic at all. This is the right moment for us to seize our opportunities, but we must not miss them." Enditem