Why this is important to Wisconsin businesses: Although European companies are already active in the market, there is still room for Wisconsin suppliers, as Latvia's economy booms and it seeks to reduce its energy dependence.
Latvian companies generated a GDP of €26.6 billion in 2017—growth of 3.1 percent over the previous year. EU funding programs, a continuous investment boom and favorable economic conditions overall in key markets are contributing to strong growth in Latvia for the current year as well. The European Commission projects that Latvia will achieve the highest GDP growth of the Baltic States in both 2018 and 2019, at 3.5 and 3.2 percent respectively, with strong gross fixed capital formation as one of the growth drivers and imports to satisfy investment demand.
Latvia has reduced its energy dependence from around 41 percent to 15 percent in recent years, and has been able to remedy the significant coastal pollution from the Soviet era. Renewable energy accounts for 39 percent of Latvia’s energy, with hydropower being one of the most frequently used forms—accounting for 54.1 percent of Latvia’s renewable energy, more than twice the EU average of 23.4 percent.
Major projects under way are the modernization of Plavinas hydroelectric power plants in Kegums in the center of the country and the Baltic Energy Market Interconnection Plan (BEMIP) to connect the Baltic States to the European electricity grid. These include, among other things the power ring connection, in the Kurzeme region of western Latvia for about €220 million, and further interconnections to Estonia. In addition, the EU-funded infrastructure project "Rail Baltica" is prompting investments totaling of about €2 billion in Latvia and will increase energy demand.
In 2016, goods worth around $14.32 billion were exported from the U.S. to Latvia, with $5 million coming from Wisconsin firms. Electrical machinery worth $110,991 was exported from Wisconsin to Latvia in 2016 and $94,925 in 2017. New projects and investments in the hydropower sector offer great opportunities for Wisconsin renewable energy companies. Although there are already European companies active in the market, innovative Wisconsin suppliers should still do well in the market.
Trade shows can provide excellent opportunities to get to know the market and meet potential partners. As Latvia is a small country, many of the relevant interesting trade shows take place in neighboring countries. For example, the Energy Supplies Industry Equipment show will take place in Kaliningrad, Russia, from March 15 to 17, 2018; MoldEnergy will be held from March 21 to 24, 2018, in Chisinau, Moldova; and the Environment and Energy show will take place from Oct. 10 to 21, 2018, in Latvia’s capital, Riga.