I have been in contact with the marketing director for one of Latvia's largest food companies. It was not a happy marketing manager who told me that their business with Sweden has come to a standstill.
At Swedish client meetings, she was often told that Latvia is going out of business because the Swedish government has said so. Nobody wants to do business with countries that are perceived to be unsuccessful, which is understandable. But can a country go bankrupt and is this true for Latvia?
Possibly, depending on what bankruptcy means, but it is not only Latvia's inhabitants that will find themselves in a difficult situation, the bankruptcy wave will hit Swedish banks and the Swedish taxpayers hard.
The comparison with Iceland is worth mentioning, here the external debt is more than 830 percent of the GDP, and a powerful devaluation is completed, which has resulted in that many Icelandic industrial concerns see a significant increase in demand for their products. The recovery in Iceland has begun.
Of course, it is a difficult time in Latvia, but they handle the situation well and Latvia will be back on track, there is no other option. Devaluation of the currency is still present and this will be yet another loss affecting Swedish banks and taxpayers.
The marketing manager also points out that many Swedes have made large investments in Latvia in recent years and for them it is now obviously a tough period, there are no exceptions to the situation prevailing at the moment.
The marketing manager told me that they also get affected when a Latvian politician speaks bad of Russia which decrease their business with Russia significantly, and it goes quickly. Once an article is out online with such a statement, we can see the effect the next day.
This clearly shows the politicians responsibilities for the statements in the press and media.
It is strange that the politicians in Sweden are not trying to have a positive view of our neighbor country Latvia, despite the difficult situation that we are in. We are actually currently President of the EU which requires responsibilities.
Is the situation in Latvia really bad? No, absolutely not.
Personally, I participated at the Investment Forum "Invest in Latvia", which took place at the Latvian Embassy in Stockholm on October 6th. A well-attended forum in which many representatives from many different Swedish industries showed great interest in the new business opportunities that Latvia offers.
This is where the possibilities of recovery exists, new business and increased trade, regardless of what is expressed by various politicians.
Cecilia Helland