Sustainable Recovery and Knowledge based Economy Karsten Vandrup Chairman, Vigrid Group

Latvia’s Economic Recovery Congratulation, the ‘Internal Devaluation’ has been a success. Well done! However, the crises hasn’t disappeared, it threatens the whole Euro zone… Adjusting the valuation can only work once, new measures has to be implemented to prevent another downturn There is a need for sustainable job creation, to survive in the new global ‘disorder’ 2

Latvia’s Potential Innovation and Knowledge – natural resources in Latvia? Latvia has good Basic Educations, and a very low rate of illiteracy (0.3%) Latvia has a tradition of science and technology in the high school level educations Latvia has strong universities, focused on natural sciences, math, technology and research High IT readiness in the population (ranked 28 in the world) Why is Latvia not on the top of the Innovation index in Europe? 3

The Knowledge Potential A large knowledge base in the society is by far the most efficient way to job creation – also in the low wage segments Strengthening the knowledge base activates new resources and attract foreign investments The most successful of the spices and the ones who are most adaptive to changes If you aren’t big, be smart! 4

The competition Shanghai Daily – September 12,

There is a need for investments My two fundamental recommendations The Business Frame Conditions – Make Latvia attractive to foreign investments – Keep Tax on Labour in the low range – Keep Company Tax low (too) – Support Innovation and Entrepreneurship The Knowledge Base – Strengthen the higher Educational System – Invest in talents, socially independent – Increase IPR generation in public institutions – Have a transparent and efficient Technology Transfer system 6

Paldies!