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LTRK: VIRUS AFFECTS ALL SECTORS, WHICH IS WHY IT IS FUTILE TO DETERMINE SECTORS REQUIRING SUPPORT

LTRK: VIRUS AFFECTS ALL SECTORS, WHICH IS WHY IT IS FUTILE TO DETERMINE SECTORS REQUIRING SUPPORT

The largest association of Latvian entrepreneurs — the Latvian Chamber of Commerce and Industry (LTRK) —, having reviewed the Draft Law on the threat to the State and measures of preventing and overcoming its consequences due to the spread of Covid-19, conceptually supports the adoption of this law, however, to ensure that a maximum number of companies survive this crisis by retaining jobs, employing the population and paying taxes, LTRK voices the following objections to the Draft Law:

Support tools must be ensured irrespective of the sector. The economic crisis caused by the pandemic will affect nearly all sectors, without discriminating companies — whether small or large, operating domestically or exporting, whether they are traders, manufacturers or service providers (a part of businesses are prohibited from carrying out operations, while others see their market crumbling by the minute, and other still experience substantial encumbrances to business due to delayed deliveries and employees being off work due to illness, whereas, due to the halting global economy, the situation in the nearest future will, most likely, deteriorate for nearly everyone). Likewise, there are multi-sector companies, and the situation of companies differs also within the framework of the same sector.

Support tools must motivate companies to continue working. Support tools must stimulate companies not to fire employees, but instead seek possibilities to continue working, even if at a reduced rate or by changing the profile. We recommend forming the support for salaries as follows: irrespective of the sector, the state will cover the state mandatory social insurance contributions for employees to the extent established by the Cabinet of Ministers.

 “LTRK believes that, in order to improve economic indicators of Latvia after the crisis faster, the main task right now is to maintain companies, ensuring liquid funds for them, therefore we do not support determining specific industries for receiving state support. Companies of all sectors are facing challenges, and it will be difficult to distinguish the sectors that require more help or less help,” claims the Chairperson of the Board of LTRK Jānis Endziņš.  

LTRK believes that most of the provisions of the law are useful and are to be supported, however it is incorrect and short-sighted to try to narrowly define sectors affected by the crisis and to envisage support only to companies of these sectors.