Between 2005-2007 large inflow of foreign capital strongly stimulated the Latvian economy. Annual GDP grew with 10%[1] and until the middle of 2008, it was the fastest developing in Europe. Unemployment rates fell from 10% to 6.1% in the same period[2]. With the 2008 financial crisis Latvian GDP contrated by a quarter from €24.3 billion to € 17.9 billion in 2010. Unemployment reached a peak at 19.5% in 2010 and the real wages of the employed fell by 12%.[3]
As of the end of 2010, the recession has stopped and growth has resumed. From 2011 to 2013 GDP grew by 4.4% per year on average, forecasted growth for 2017 is 2.9%. At this pace it will take Latvia a full 50 years to reach EU average level of welfare. To address the economic crisis, increase the pace of economic growth and in light of rapid technology transition, Latvia in 2014 identified the “knowledge” sectors as strategic smart specialization directions for its economic development.[4] To induce the change and growth strategy has defined five specialization areas: 1) Knowledge-intensive bio-economics; 2) Biomedicine, medical technologies, 3) Bio-pharmacy and biotechnologies; 4) Smart materials, technologies and engineering systems; smart energetics; 5) Information and communication technologies (ICT). The ICT sector is one of the government’s defined priorities.
Latvia’s ICT capacity are well established - the ICT sector and its export capacity is growing rapidly, in 2016 it became the third largest export sector of Latvia, after wood materials and food products overtaking previous third export whale - transit sector. In comparison to 2014 ICT services export growth rate in 2016 reached 24%, thus reaching €361.32 million thus becoming one of the fastest growing sectors in Latvia. The sector revenue increased by 90% to €288 million between 2011 – 2016[5], number of employed in sector in the same period has increased 1.7 times, also the percentage share of the ICT sector of GDP has grown and reached 4.7% in 2016.
In this context, the data based 4th industrial revolution provides unique moment and opportunity for compact, agile countries with a well-established ICT capacity like Latvia to ensure a successful, sustainable and viable economic transition with GDP growth and job creation.
To exploit that momentum, Latvia consolidated academia, industry and business around a common national vision for Development of Data Driven Nation (DDN). In December 2016, the Memorandum of Cooperation on ‘common goals and cooperation in the process of digital transformation of Latvia and development of a Data Driven Nation’. Currently, 25 partners have signed memorandum, including government institutions, universities, national and multinational ICT companies.
The Memorandum upon which the concept and goals of DDN was signed is based on three pillars
I Data democracy and free access to public data: Aim is to promote data availability, transparency and reuse of government data, including the development of proper legal regulation.
The success criteria include:
Positive impact on strategic criteria stated in National Development Plan of Latvia for 2014 – 2020: Increase turnover of innovative products (as a % of total turnover) to 11% by 2020*, increase proportion of innovative businesses (as % of all companies) to 30% by 2020. Open data specific criteria – identified data sets with high commercialization potential, 120 government data sets released until 2020, improved rating in EU Open data maturity assessment[6].
Activities under this pillar include:
- Facilitate opening of government data: Identification of data sets with high commercialization; Implement open data licenses and metadata standards; Proactive work with institutions to open data and publish in Open data portal;
- Created a framework for cloud service usage in government (strategy) and initiate transfer to logically unified government data center;
- Set regulation to enable and facilitate cooperation between government and private sector on innovative ICT product development and collaborative trialing
- Improve ICT and data competences of government officials and citizens and facilitate usage of data for product development and evidence-based policy- train 30 top level managers in government;
II Data enabled citizen engagement: Aim is to proactively communication and provide government service delivery, involve citizen in public sector decision making processes.
The success criteria include:
Until 2021 - 85% of citizen participation in legislative process in government is going to be submitted electronically, all central government institutions (115) and at least 50 NGO’s will regularly be involved in process; Non- automatic case processing in legislative process will be decreased to 33% (currently 100%).
Activities under this pillar include:*
- Actively engage citizens in policy planning and legislative processes:
- Implementation of integrated legislative process system and portal, with integrated public consultation possibilities
- Facilitate openness of the government
- Develop platform for government websites that fulfill criteria of openness and accessibility; Improve availability of online streams of central government and municipal work
- Increase citizen centricity and quality of public services by co-creation with citizens
III Data driven innovations (innovative data products commercialization): Aim is though data and technologies to develop new and innovative products and services. E-governance projects are seen as the innovation platform and launching pad for the implementation of innovative projects with high commercialization and export potential in the future.
The success criteria include:
Number of enterprises received support to develop new products until of 2023 will reach 100. Increased private investments in R&D projects. Increase of attracted foreign investment to research projects in business sector.
Activities under this pillar include:
- Provide support for industry 4.0 capacity development
- Develop regulation to facilitate data based innovation development and commercialization, non-monetary patronage for high potential projects.
- Attraction of private sector investments to development of new product and technologies – funding for cross-sectoral research and pilot projects in smart specialization sectors (€63,3 million ERDF funding[7]) available from 2017 – 2021.
- Execute industry 4.0 awareness activities within industries
- Strengthening of ICT sector
- Development of ICT sector development strategy until 2025
- Identify high productivity strategic investment projects with in ICT
- Design and execute cross-sectoral data based research pilot projects.
To succeed, the capacities of Latvian science, the competence of IT sector and competitiveness will be stimulated, in line with the global technology development tendencies, such as big data, machine learning, robotics and other areas, where Latvia has already demonstrated strong capabilities.
Innovation and distribution platform
Currently memorandum on Data Driven Nation is signed by 25 partners, ranging from government institutions, academia, NGOs, chambers of commerce, local ICT companies and multinationals.
Data Driven Nation implementation plan is regularly reviewed and discussed in National Information Society Council, led by Prime minister.
First results include
- In Partnership with Microsoft, regional Innovation center has been opened in Riga, 2016.
The first technological innovation platform of its kind in the region of Baltic countries and Northern Europe[8]. Objective of this center is to strengthen the cooperation between partners of the ICT (Information and Communication Technologies) industry, science, non-governmental organizations and public sector, development of export capable IT solutions and digital transformation within Latvia. The Innovation Centre will undertake two main directions – the implementation of innovative interdisciplinary IT projects with the focus on cloud computing technologies, IoT (Internet of Things) and artificial intelligence solutions, and the popularization of IT education and support for preparing new specialists.
- Initiated partnership with Roche on big data based Gene analysis pilot-project for cancer diagnostics and treatment, 2016.[9]
Pilot project will test potential cooperation models to settle in Latvia their North Europe center of excellence in genomics. It is expected that center will conduct applied research in genomics and will provide services to health sector institutions and companies and will facilitate development of start-up environment in genomic sector.
- National Open data portal[10] has been launched and data sets are being published.
currently 74 data sets are published by end of 2017, but 20 more institutions report on their plans to publish additional data sets in the coming months. It is expected that number will increase because of regulation that all 2007 – 2021 ERDF funded government projects must release open data sets in data.gov.lv.
- Information society development council led by Prime minister has agreed to make Address register and few Geospatial data sets available for fee-free usage (costs to be covered by government budget), which were identified as priorities by business and ICT sector NGO’s.
- In discussions with private and academic sector stakeholders next valuable data sets to be provided or provided without fee are being identified, such as air quality data, weather forecast, postal codes and respective areas, public transport, water quality, health sector (medicine, medicine prices, etc).
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For further information: Ministry of Environmental Protection and Regional Development of Latvia, Public services department, www.varam.gov.lv.
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[1] www.imf.org/external/pubs/ft/weo/2017/01/weodata/weorept.aspx?pr.x=31&p…
[2] http://data.csb.gov.lv/pxweb/lv/Sociala/Sociala__ikgad__nodarb/NB0020.p…
[3] https://www.em.gov.lv/files/tautsaimniecibas_attistiba/zin/2016_jun_eng…
[4] http://www.izm.gov.lv/en/Science/smart-specialisation-strategy
[5] http://data.csb.gov.lv/pxweb/lv/zin/zin__datoriz__ikt_sektors/IT0230_29…
[6] Strategic goal set in 2014 was to reach 500 by 2020, but as Open data maturity assessment methodology changed, target number is not relevant anymore.
[7] https://likumi.lv/ta/id/279410-darbibas-programmas-izaugsme-un-nodarbin…
[8] https://www.microsoftinnovationcenters.com/locations