Working Life Barometer in the Baltic Countries 2002 (pdf) - mol.fi

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the concentration of industry and unemployment. As a rule, the south-east is
less developed than the central regions. Urban structures mainly exist in the
capital city Riga, which is the biggest city (743 269 inhabitants in June 30,
2002) in the Baltic states.
Regional development policy in Latvia should be paid more attention. During
the fifty years of Soviet occupation in Latvia, certain economic sectors were
developed under the auspices of the centralised planning system without any
economic justification and despite the fact that Latvia had neither necessary
production factors, nor a market for the goods that were produced. This led to
the creation of an artificial and deformed territorial structure for the economy;
the most important consequences of which are the following:
1. an excessive concentration of residents and production processes in the
Riga region;
2. a relatively low population density and poorly developed production
processes and infrastructure elsewhere in Latvia;
3. significant differences in the standard of living in various areas of
Latvia, which can be determined on the basis of per-capita income,
unemployment levels, development of the social and production
infrastructure, and other indicators.
As a result of the territorial deformation mentioned above, about one third of
the entire population (2.36 million inhabitants in July, 2002) lives in the city
of Riga. In addition, an excessive concentration of production, social
infrastructure as well as scientific potential has occurred in the district of Riga.
In June 30, 2002 the capital city accounted for 52 % of the industrial output,
56 % of all capital investments were effected in Riga. The unemployment rate
in this city (3.8 %) is close to half the national average (7.8 %). While
unemployment in the Saldus district is 6.3 %, it is 27.4 % in the Rezekne
district.
Issues of regional development have become especially important in recent
years, with the establishment of the market economy. Market forces have led
to a polarisation of different regions in the country. If regional policy
instruments were not applied, the differences between economically stronger
and weaker regions would not only be preserved, but might in fact increase.
This is because the economically stronger regions have more favourable