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International Internet Magazine. Baltic States news & analytics Friday, 21.06.2024, 15:35

Mayor of Riga presents an Ambitious Agenda and Plans for the City

BC, Riga , 01.12.2020.Print version
The Mayor of Riga Mārtiņš Staķis who was elected earlier this year during Extraordinary Elections of the Council of Riga on the platform to change the corporate governance culture in Riga and reshape Riga into orderly, open, green and people-friendly metropolis of Northern Europe, last week spoke to the Norwegian investor community in Latvia and presented his personal priorities and the plans of the newly-established “Riga Change Coalition”.

In his presentation to the Norwegian investor community, M. Staķis presented an elaborate Action Plan for Riga that the governing parties have agreed upon to achieve by 2025 with focus on critical areas, such as establishing good corporate governance and cooperation, improving mobility and infrastructure, promoting urban development and environmental protection, among others. Four investors that joined the conversation - Frode Gronvold, CEO of Linstow Center Management, Ilze Grase-Ķibilde, General Manager of Moller Baltic Import, Aleksis Karlsons, a representative of the Omnium Properties group, and Santa Rozenkopfa, Managing Director of CBRE Baltics, welcomed the plans outlined by the Mayor of Riga and pointed out several additional critical aspects to improving quality of life in Latvia’s capital and increasing its attractiveness to foreign investors.

The discussion with the Mayor of Riga was moderated by Matīss Kukainis, Chairman of the Norwegian Chamber of Commerce in Latvia (NCCL) and Founder & Partner of Spīgulis & Kukainis Law Firm. The discussion was organized by NCCL with the support of the Norwegian Embassy.

New Project Development

“Riga City should capitalize on the historic opportunity the Rail Baltica project represents. This project opens up for an upgrade of the Railway station area connecting the two sides of Riga and hence new opportunities for developers,” says Frode Gronvold, CEO of Linstow Center Management, which have been investing in various real estate development projects in Riga for more than 20 years. F. Gronvold calls attention to the principles introduced by Danish architect Jan Gehl, which suggest that pedestrians should always be prioritized ahead of cars and it is very important to create easy communication within a city for all types of communication, but especially for pedestrians and bicyclists. 

F. Gronvold believes that on the backdrop of Rail Baltica project many of the principles introduced by J. Gehl can be implemented. “These relatively simple principles increase the value of Real Estate in a city. When the value of the Real Estate is increased, that opens up opportunities for more related investments in the city. It also increases value for the municipality in terms of increased economic activity and tax income,” adds F. Gronvold. 

In response to this, M. Staķis says that the new Riga City Council intends to be an active player in the Rail Baltic project and will aim to make the city more walkable and with better-integrated transport networks. In the area of new project development, the Mayor of Riga emphasized the Green Corridor that has been recently established to increase the speed of reviewing and obtaining approval for new construction projects. 

Sustainable and Improved Mobility

Ilze Grase-Ķibilde, General Manager of Moller Baltic Import, referring to experience from Oslo, which has limited access to the city center for high polluting cars, asked the Mayor of Riga about his plans to improve the air and life quality in the City of Riga. In response, M. Staķis pointed out that his target is to make Riga the first climate neutral city in the Baltics. “Our aim is to make Riga more walkable and livable city,” said the Mayor of Riga, specifying that he will start by launching several pilot projects and experiments, and evaluate their impact on local communities.

Compared to any other EU city, one third from whole population of Latvia resides in Riga, which is critical from mobility point of view, as most of them live in flats of multi-story buildings. According to study, 80% of e-mobility driver charge whilst at home, which is challenging in mentioned city conditions, says I. Grase-Ķibilde, emphasizing out the need to develop solutions for charging stations around the city, especially in areas with high resident density.

When speaking about public transport system, M. Staķis acknowledges that currently the Railway system and the municipal public transport system are two completely separate systems. His goal is to merge them together in one ticketing system. Focusing on cooperation rather than competition, Riga Area mobility program would link Riga and its surrounding municipalities in one public transport system, said the Mayor.

Preserving the Historical Centre

Predictability and not too much bureaucracy are the two main things that Aleksis Karlsons,  from the Omnium Properties group, expects from the Municipality. However, he also points out the need for various support programs, such as tax discounts and co-financing mechanisms to support rejuvenation of Riga’s historical center. 

„It is important to protect the historical center not only to preserve our historical heritage, the beautiful environment that every inhabitant of Latvia can enjoy and show to our children, but also because the historical center is the main driving force of the Latvian tourism industry,“ says A. Karlsons who is the founding member and Chairman of the board of the Latvian Private Historic Houses Association and the Riga Centre Association of Private Historic Buildings. He reminds that a complete restoration of historic buildings and their management and maintenance costs 1.5 to 2 times more than that of new buildings on top of various restrictions that have been placed on historical properties. Hence, various support programs are highly essential to stimulate reconstruction and renovation of these properties.

As confirmed by M. Staķis, the City Council intends to continue the real estate tax credit system, which is based on the type of the building and the social situation of the tax payer can add up to 90%. The new Riga City Council plans to continue the renovation co-financing mechanism of cultural and heritage preservation projects, which was started four years ago with a budget of 1,4 mln EUR for the next year.

Attracting Foreign Investments

The Managing Director of CBRE Baltics Santa Rozenkopfa reminds that the main driving force why the real estate development is improving or stagnating is the occupiers and the absorption speed of a vacant space. She points out that now is the best timing not only to do a reorganization, but also to promote the Capital of Latvia. “We have been receiving signals that second-tier cities in the Baltics, and Riga as well, are high on the agenda for corporate occupiers due to technological progress making work for highly skilled workers possible in all parts of the world. Riga can offer a high quality of life that it should be promoting and multiplying its success stories!” says S. Rozenkopfa, emphasizing the need for proactive and effective city promotion efforts.

Speaking about competing with other Baltic capital cities for investment attraction M. Staķis acknowledges: “As good is not good enough. If you are not much better than your competitor then the system does not work.” However, the Mayor of Riga believes that Riga has much better possibilities than Vilnius due to the Riga’s Airport. A new Investment and Tourism agency, which will be built of the foundation of Riga’s Tourism Development Bureau, is expected to start work in January 2021 and will work in synergy with Latvia’s Investment and Development Agency to service foreign investors. 

Corporate Governance and Fight against Corruption

The Chairman of NCCL Matīss Kukainis pointed out that the Norwegian Government via the EEA / Norway Grants program has disbursed over 13 mln EUR to support preventing and combating Economic Crime in Latvia and creating whistleblowing mechanisms. When asked about going after those who have been behind misappropriation of funds at “Rīgas Satiksme” and the Southern Bridge project, the Mayor of Riga emphasized that already 77 people have already been sued, but also acknowledged that it may be harder to prosecute somebody in relation to the Southern Bridge construction project that was completed in 2008. The project costs exceeded more than 800 mln EUR (570 mln LVL), making it one of the most expensive bridges in the world.

“We have to create a new system in the municipality and companies owned by the municipality, where the corruption is on a zero level. And it starts with me and with my statement that I want this city free of corruption,” says M. Staķis, reminding that one of the Vice-Mayors Linda Ozola has been tasked with fighting corruption and promoting good governance at the municipality. M. Staķis encourages whistleblowers that know of wrongdoing not to be scared and report the problems to the City Council.

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