In the recent ten years the export-focussed sectors and enterprises have developed more rapidly in Latvia therefore those enterprises will have the greatest chances to reach TOP 101 top ten which are be able to take advantage of the opportunities provided by the global economy. At this moment some ambiguity surrounds globalization vector, however, in general the global economy becomes digital, the automation technologies develop with great speed and the cross-border trade in services grows very rapidly.  This knowledge-based export is embodied by the most successful enterprise in the recent years, Mikrotīkls, having reached the top ten.

Meanwhile, in the next ten years, the greatest potential to reach the top ten will be possessed by a representative of digital economy from service sector, to my mind. Since 2010 the export of information technology services in Latvia has been growing at average by more than 20% per year, and the size of the industry doubles more frequently in Latvia compared to that of us going to the polls. This unlocks a very great potential for the growth.  At the same time a great number of small and medium-size enterprises predominate, and the question is open whether any of the enterprises will have the capability to increase its size to such extent so that it could compete with the leaders of the traditional industries?

Assessing particular enterprises, at this moment the most potential could be possessed by EVOLUTION LATVIA which is already one of the largest employers in the country with very strong development dynamics. However, other companies in IT sector have potential as well, and some surprises may also occur in the industries   related to the digital economy. For example, online trading has grown already for some time by approximately 30% every year in Latvia, and will create ever stronger competition for the traditional traders.

At the same time the biggest challenge in the service sector is that the export of the industry is formed largely by the working hours. Will we find any our ideas to be exported in the next ten years?  It is very difficult to foresee.  The new enterprises in Latvia have many such ideas, however, implementation of a good idea into a big business should overcome the limited local capital availability, lack of commercial experience and the small size of the domestic market, but this is definitely rather possible.  

Does all this mean that the traditional industries do not have the potential? I think no, and other industries can also make the most of external market opportunities.  If the ambitious expansion plans will be successful, Airbaltic will certainly qualify for the top ten.  Similarly, upon successful concurrence of factors one of the Latvian large wood-processing, food production or pharmaceutical enterprises can make it into the top ten.  Of course, the existing top leaders do not sleep and do develop, but the current top largely consists of the state-owned capital companies and companies operating in the local market, and their private potential will be restricted by the small local market as well as negative demographic trends.

Mārtiņš Āboliņš, Economist, bank “Citadale”