Analytics, Baltic Export, Baltic States – CIS, EU – Baltic States, Foreign trade

According to the Central Statistics Bureau's data, Latvian export of goods picked up 1.2% last year, which was by far the best performance among the Baltic States. It also partly explains why Latvia recorded faster economic growth than Lithuania and Estonia in 2015, Abolins said.

Meanwhile, Latvian imports slowed 1.3% year-on-year in 2015, which in combination with export growth allowed Latvia to narrow its trade gap by EUR 288.7 million.

"Although the moderate export growth and drop in import might seem a relatively weak performance, it does not really characterize the current reality of the Latvian economy. Last year, both export and import were adversely influenced by various factors not directly linked to the Latvian economy. The steep drop of the oil price in the world, for example, significantly reduced both export and import value of oil products in euro. This made export figures look worse but was good for us because cheaper oil allowed the Latvian economy to save EUR 255 million or 1% of GDP last year," the Citadele economist explained.

If, along with the oil products, alcohol export (which basically consists of re-export to Russia and which plummeted in 2015) was also excluded from Latvia's export statistics, Latvian export grew by nearly 4% last year, which is closer to the country's overall economic growth rate, the economist said.

"To a great extent, Latvia's export growth was driven by rising exports of grain, timber, as well as various electric appliances, machines and optical equipment. Apart from the oil products and alcoholic beverages, the biggest reduction was recorded in the export of various dairy and fish products, as well as clothing. The drop in these products' export was largely caused by Russia's sanctions and economic issues, but this drop has had a limited impact on overall growth figures," Abolins said.

Latvia's dairy product export decreased by EUR 44 million last year, but dairy product imports declined as well, which means that the net reduction was EUR 25 million, the economist said. At the same time, fish product exports decreased by EUR 12 million as Russia imposed its sanctions in the middle of the year. The combined reduction of dairy product and canned fish exports came to an estimated EUR 50-55 million, but this was only one fifth of the Latvian economy's gain from lower oil prices, Abolins explained.

Overall, there was a 1.2% increase in exports in 2015 when compared to the previous years, Economics Ministry Economic Development and Job Market Projection Department spokesman Edmunds Gergelevics informed LETA.

He said that exports to EU countries increased by 1.9% last year, while exports CIS countries reduced by 19.8%. Exports to all other countries increased by 22.4%.

Meanwhile, there was a 1.3% reduction in imports last year. The ministry expects that there will be a moderate increase in exports in 2016.

He said that the reduction in exports to CIS countries can be explained by the economic situation in Russia, as well as the Russian good embargo.

As reported, provisional data compiled by the Central Statistical Bureau (CSB) shows that in 2015 foreign trade turnover at current prices in Latvia amounted to EUR 22.86 billion – by EUR 42.9 million or 0.2% less as compared to 2014.

The value of exports increased by EUR 122.9 million or 1.2%, while the value of important decreased by EUR or 165.8 million or 1.3%.

In December 2015, compared to November 2015, foreign trade turnover at current prices in Latvia decreased by 10.3%, while the export value of goods dropped by 12.6%, and the import value – by 8.3%.

In December the amount of goods exported by Latvia comprised EUR 817 million, while the amount of imported goods constituted EUR 972.5 million. The foreign trade balance became worse as exports in the total amount of foreign trade dropped to 45.7% (in November 2015 – 46.9%).