OREANDA-NEWS. September 19, 2011. Latvian President Andris Berzins was on a working visit to meet with the European Commission’s commissioner for budget planning and budgeting, Janusz Lewandowski. The two officials discussed preparations for the EU’s multi-year budget, cohesion policy principles during the next planning period, direct payments in terms of agricultural policy, the implementation of Latvia’s international lending programme, as well as the development of major energy projects in the Baltic region.
 
At the beginning of the meeting, Commissioner Lewandowski congratulated President Berzins on his election and said that Latvia sets an example for all EU member states in terms of overcoming the crisis and ensuring economic recovery. President Berzins, for his part, said that the results of this week’s snap Saeima election, the next government, its operating declaration, and the next Latvian prime minister will be of great importance in terms of Latvia’s future development, particularly given the international lending programme and the future of economic stabilisation and growth in Latvia.
 
President Berzins also insisted that Latvia is prepared to continue the process of consolidation and to uphold the goal of joining the euro zone in 2014. Mr Berzins added that Latvia is among those EU member states which still need fiscal support from the EU as it plans its multi-year budget. In the medium term, therefore, Latvia is interested not just in the EU 2020 strategy and its global competition goals in terms of the new multi-year budget, but also in support for convergence specifically in the EU. The President also insisted that before Latvia can achieve the average standard of living of the EU, it must receive cohesion support, as well as equal terms for farmers in terms of direct payments and the development of the infrastructure, not least in terms of integrating the market for energy resources.
 
Mr Lewandowski said that the results of the negotiations about the next budget planning period will depend very much on the activities and professionalism of Latvia’s diplomats and other representatives. The commissioner admitted that Latvian diplomats have been very active and professional in defending Latvia’s positions on matters such as direct agricultural payments. The European Commission released its proposal on the multi-year budget in June, and it is focused on the implementation of the EU 2020 strategy that is aimed at ensuring growth over the next decade that will allow the EU economy to become more sustainable and integrated.
 
In talking about Latvia’s position on the need for cohesion policies, President Berzins pointed out that per capita GDP in Latvia remains at 52% of the EU average, while EU Structural Funds have indirectly allowed the country to increase GDP whilst also supporting the establishment of new companies so as to increase the number of employees at companies with financing from the EU Structural Funds by 10% more than other companies have done. There has also been support for education, which means that cohesion policies are of great importance for Latvia, said the President. Latvia insists that the construction projects financed from the Cohesion Fund have become more expensive specifically because of the comparatively low level of population density in the country.
 
In terms of direct payments related to the EU’s Common Agricultural Policy, President Berzins particularly insisted that the proposal from the EC on evening out direct payments is unacceptable for Latvia, because it will not ensure fair and honest support for all EU farmers. Neither will it ensure equal payments among member states, which means that the competitiveness of farmers in certain EU member states, including Latvia, will not be helped. Latvia has had the lowest level of direct payments ever since 2004, and that is why Latvia cannot accept the gradual evening out of direct payments, as provided for in the EC proposal. In explaining Latvia’s position, Mr Berzins said that the EC’s proposed principles would mean that after 2013, the direct payment system would be based on historical, out-of-date and unimportant criteria based on data about the period between 1997 and 1999, when agricultural indicators in Latvia were lower than at any time since the restoration of the country’s independence. Using such data for new calculations would not be appropriate, and it would mean that the direct payment system would continue to be in violation of the overall goals of the Common Agricultural Policy, said the President.
 
Commissioner Lewandowski said that he understands Latvia’s position and concerns. He insisted that decisions on the multi-year budget principles and the preparation of the budget must involve a compromise among EU member states, because the EU is not planning to increase the overall budget in this area, and so the final decision must be balanced and justified.
 
The President and the commissioner also discussed energy projects, including the construction of a liquefied gas terminal in the Baltic States. President Berzins said that Latvia already has advantages for the project, given that it has conducted preliminary investigation of the situation and that it already has natural gas storage facilities. Speaking on behalf of the EC, Commissioner Lewandowski explains that the Baltic States need to reach agreement on a joint position vis-a-vis the construction of the liquefied gas terminal, and only then might the European Commission agree to offer co-financing for the project.
 
President Berzins also met with Latvia’s ambassadress extraordinary and plenipotentiary to the Kingdom of Belgium, Lelde Lice-Licite, to learn about the embassy’s priorities and operating principles, given that it is in the same building as Latvia’s representation at the EU and works closely together with it. The ambassadress said that the role of the Latvian representation is decisive, and bilateral relations in Belgium involve three different issues. One is popularisation of Latvia, given that 186 countries are represented in Brussels, as are many different financial organisations, which means that the role of Brussels in establishing commercial contacts is very important.

Second, there is the need to create new economic projects, because Belgium did not experience any radical economic decline during the global economic crisis, and the purchasing power of Belgians did not decline. That means that Belgium can be a good market for Latvian products. Third, there must be work related to the Latvian community in Brussels, which is made up of some 2,000 people. The embassy, said the ambassadress, has an important role to play in preserving Latvian identity and in expanding opportunities to learn the Latvian language. That is because those who work in Brussels include diplomats and professionals who are involved in EU structures and move to Belgium with their whole families. President Berzins praised the goals which the ambassadress proposed and said that he supports them.