European Commission president speaks appreciatively of Latvia's national recovery plan

RIGA - Latvia's national recovery and resilience plan was submitted quickly and the plan is of good quality and balanced, European Commission President Ursula von der Leyen said at a news conference Tuesday.

Like other countries, Latvia has put the emphasis in its plan on climate goals and digital transformation, the European Commission president said, noting that Latvia's plan also stresses social inclusion and investing in people and their skills.

In the context of social inclusion, Leyen underlined the importance of a minimum income reform, investing in industrial parks, education institutions and affordable housing. The European Commission chief said that all this shows Latvia's focus on taking care of the people and their day-to-day needs.

Leyen also praised Latvia for the decision to invest in the health sector to improve access to healthcare services. She also said that Latvia's plan stresses the development of people's digital skills, which in her words, the a bridge to the future.

The European Commission president believes that Europe's NextGenerationEU recovery instrument is an excellent response to the unprecedent crisis brought about by the Covid-19 pandemic. Although member states' economies have suffered greatly in the crisis, the instrument is not just about the recovery and healing, but also about a transformation of the EU's economy and society.

Leyen noted that the process of digitalization is now as extensive as ever and work is under way to make the EU's Green Deal a reality. Meanwhile, members of society are being provided with everything to help them become even stronger and resilient. The EUR 800 billion instrument is bringing renewal, which is necessary to Europe and Latvia in order to recover from the crisis, Leyen believes. 

The European Commission chief indicated that in coming years, Latvia will receive EUR 1.8 billion from this instrument, with 37 percent of this amount intended for climate goals. Leyen noted that some of this money should be spent to ensure energy efficiency of homes. The money will also be spent on promoting mobility and purchase of solar panels. Around EUR 300 million will be invested to overhaul Riga's transport system. 

Meanwhile, 21 percent of the earmarked recovery funding will be spent on the digital transformation. According to the European Commission's president, the support will allow Latvia's businesses to become more digital and develop new products, expand to new markets and create new jobs. This will be also an investment in the 5G network.

Leyen also welcomed reforms planned in Latvia's health sector, noting that ten Latvia's hospitals will receive financing so they can provide high-level healthcare services. The plan also includes a minimum income reform and education reform.

As reported, the European Commission has approved Latvia's Recovery and Resilience Plan in the amount of EUR 1.8 billion, the Commission's representatives said on Tuesday.

The Recovery and Resilience Plan has yet to be approved by the European Council.

Latvia's Recovery and Resilience Plan was submitted to the Commission on April 30 in the amount of EUR 1.826 billion. The plan stipulates aid in six areas: achieving climate goals, digital transformation, reducing inequality, economic transformation and productivity reforms, the health sector and strengthening the rule of law.

The plan contains 85 measures, including 24 reforms and 61 investments.

According to the plan, EUR 676.2 million will be allocated for achieving climate goals (sustainable transport, energy efficiency, renewables and decarbonization of electricity grids, adaptation to climate change), EUR 365.3 million for digital transformation (digitization of public and private sectors, e-government services, data management, digital skills, 5G), EUR 370 million for reducing inequality (road reconstruction, school infrastructure, affordable housing, industrial parks, social services, long-term care, skills development).

EUR 196 million will be set aside for economic transformation and productivity reforms (innovation management, promotion of private sector research and innovation, investment in research, management of higher education and science, career development in research), EUR 181.5 million for healthcare (hospital and outpatient infrastructure, human resources, sustainability, public health), and EUR 37 million for strengthening the rule of law (combating economic crime, prevention of money laundering, public administration, procurement).

The Recovery and Resilience Facility will provide large-scale financial support to reforms and investments undertaken by EU member countries, with the aims of mitigating the economic and social impact of the coronavirus pandemic and of making the EU economies more sustainable, resilient and better prepared for the challenges posed by the green and digital transitions. It will help member states to address the challenges identified in the European Semester, in areas such as competitiveness, productivity, environmental sustainability, education and skills, health, employment, and economic, social and territorial cohesion. It will also ensure adequate focus of these investments and reforms based on the green and digital transitions, to help create jobs and sustainable growth and make the EU more resilient.