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Lursoft: number of newly-founded businesses has increased in 57 Latvian municipalities

The number of newly-founded businesses had increased in 57 Latvian municipalities, remained unchanged in four, and reduced in 58 municipalities in 2017, according to data compiled by Lursoft.

67.57% of all newly-founded businesses were registered in Latvia’s largest cities.


Numerically the largest increase was noted in Liepaja, where 303 new businesses were registered in 2017. This means 39 more new businesses when compared with 2016. Jekabpils experienced an increase by 22 new businesses (57 in 2016, 79 in 2017). Madona saw an increase by 16 new businesses (67 in 2016 and 83 in 2017).


Lursoft data shows that a total of 6,899 new businesses were founded in Latvia’s largest cities. This accounts for 67.57% of all new businesses registered in Latvia last year. Compared with a year before, the number of newly-registered businesses in Latvia’s largest cities has declined 10.95%. Still, not all cities experienced a negative trend, because in Liepaja, for example, the number of newly-registered businesses had increased by 39 in 2017 in comparison with 2016. Increase in Jekabpils was 22, in Jelgava it was 5, in Rezekne it was 4 and in Daugavpils it was 3.


Looking at the number of newly-registered businesses in comparison with the number of liquidated ones, it can be concluded that the number of new businesses has increased only in two cities, because nearly all Latvian cities had experienced more liquidations than registrations of new businesses. Jelgava was one exception. The number of newly-registered businesses there was 10 more than liquidated businesses, as reported by Lursoft communications manager Indra Urtāne.


Lursoft calculated that 12,041 businesses or 73.07% of all businesses liquidated in Latvia were based in large cities. 60.31% of businesses liquidated in Latvia were based in Riga. It should be added that the number of liquidated businesses grew the most rapidly in Riga – by 53.72%.  The second most considerable increase in the number of liquidated businesses was registered in Jekabpils (+38.46%).


Ventpils and Valmiera should be mentioned separately, because opposite to the general situation, the number of liquidated businesses had declined last year when compared with 2016. Ventspils experienced 13 fewer liquidations of businesses and Valmiera – 2 fewer liquidations.


Certain counties ahead of large cities

Data shows that new businesses had emerged in all Latvian counties in 2017. The number of newly-registered businesses tends to decrease the further away from the capital and large cities.
 

Lursoft has calculated that less than ten new businesses were registered in 35 counties in 2017. The smallest number of newly-registered businesses was noted in Baltinava County (two new businesses). ‘It should be said that Pieriga took the lead from even some of the largest cities in Latvia last year: Marupe (190), Ogre (142), Kekava (140), Olaine (101) and Sigulda (100) all experienced more newly-registered businesses than Rezekne, Valmiera and Ventspils,’ comments Lursoft representative.


Looking at the relationship between newly-registered and liquidated companies, Lursoft representative notes that a positive trend was noted only in 20 municipalities last year. The number of newly-registered companies there exceeded the number of liquidated ones. Marupe is especially noteworthy in this regard, because the number of newly-registered businesses there exceeds the number of liquidated ones by 61, followed by Babite (28 more) and Adazi (17 more). Other counties situated farther away from Riga are also worth mentioning, including Akniste (+1), Lubana (+3) and Aizpute (+8).


Urtāne mentions that the number of liquidated businesses was equal to the number of newly-registered ones in five municipalities. This situation was present in Carnikava, Jelgava, Koknese, Mazsalaca and Baldone.


Larger population does not guarantee larger number of businesses


«Although it is often said that a larger population guarantees businesses, this belief is easily proven wrong if we look at statistics,» says Lursoft representative.
 

This is demonstrated by Durbe’s example. 146.81 businesses per 1,000 residents were registered there in 2017. This means 435 active companies were registered per 2,963 residents in Durbe last year. In Daugavpils, on the other hand, only 44.26 businesses were registered per 1,000 residents (4,169 active businesses per 94,196 residents).


Municipalities in which the number of companies per 1,000 residents was the largest include:


- Riga: 151.38 businesses per 1,000 residents;

- Durbe: 146.81 businesses per 1,000 residents;

- Marupe: 144.48 businesses per 1,000 residents;

- Rauna: 140.48 businesses per 1,000 residents;

- Garkalne: 135.21 businesses per 1,000 residents.


In all of Latvia’s municipalities, the number of active businesses in 22 of them had exceeded 100 per 1,000 residents in 2017. The number of newly-registered businesses in nine of them had exceeded the number of liquidated businesses. This could point to a positive trend for the future and ensure positive growth.


Lursoft has calculated that the smallest number of active businesses per capita in Latvian municipalities was registered in certain regions of Latgale: Zilupe (33.73 businesses per 1,000 residents), Vilani (33.73 businesses per 1,000 residents) and Aglona (39.79 businesses per 1,000 residents).


Values differ drastically in Latvia’s largest cities. Data compiled by Lursoft shows that the number of active businesses per 1,000 residents exceeded 100 in Riga (151.38 per 1,000 residents). In other cities, the number was 66.18 businesses on average.


Active businesses court per 1,000 residents in Latvian cities:

- Daugavpils (44.26)

- Jelgava (72.14)

- Jekabpils (59.71)

- Jurmala (79.81)

- Liepaja (71.43)

- Rezekne (55.65)

- Riga (151.38)

- Valmiera (81.44)

- Ventspils (64.88).

BNN

04-01-2018
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