In Q3 2024, the value of Latvia’s exports has slightly increased YoY, with Latvia’s exports experiencing more positive trends in the services sector. Global uncertainty remains high, and potential US tariffs on exports from the EU could hinder more buoyant economic growth and recovery in trade. Moreover, suppose the US were to impose customs tariffs on China. In that case, Chinese exporters might increasingly turn towards Europe, further intensifying the market competition for Latvian exporters, who are already experiencing signs of deteriorating competitiveness in terms of costs.

FDI reached 327 million euros or 3.2% of GDP in the third quarter and 658 million euros or 2.3 % of GDP in the first three quarters of 2024. Investments were largely made in professional, scientific, and technical activities, as well as in financial and insurance activities. The largest investments came from Sweden, Estonia, and Denmark.

Goods imports decreased only slightly year over year, as consumption did not grow rapidly and investments in the Latvian economy declined. Imports of mineral products have declined YoY – the value of imported gas, oil products, and electricity has decreased, with their prices falling below the previous year’s levels. Meanwhile, energy prices have been volatile in response to various geopolitical tensions around the world. Among other goods, only imports of machinery and electrical equipment have seen a larger decline, while imports of other goods have remained largely unchanged.

Exports of travel and transport services increased and the activity of visitors from abroad grew. The fastest-growing component of transport services has been road transport. Among other services, telecommunication and computer services continued on an upward trend, while exports of other business services maintained a value similar to that of the previous year.

Although the value of services exports in Latvia has reached a record high, it should be noted, that, in the context of the Baltic States, services exports from Latvia have fallen behind those of Lithuania and Estonia, with Lithuania experiencing rapid growth in road transport and financial services and Estonia recording faster export growth in ICT and other business services sectors.

Imports of construction services have increased likely due to Rail Baltica construction works. With more such works underway, this trend is expected to continue in the future. Imports of other services have remained broadly unchanged, and only imports of other business services (such as trade-related services) have grown.