This index compares EU/EEA/EFTA members for intra-European sourcing decisions. Scores reflect relative risk between member states from a Nordic buyer perspective.

weighted score 3.6 · seven dimensions

Intra-EU/EEA Sourcing Risk

Latvia

Governance, labour enforcement, regulatory gap, transparency, political risk, payment risk and logistics connectivity intelligence for Latvia as an intra-EU sourcing origin.

Governance & rule of law

CPI ~56. Judicial reforms ongoing and progressing. KNAB anti-corruption bureau strengthened. Governance improving but reform process not yet complete.

Labour standards enforcement

Active State Labour Inspectorate with constrained resources. EU-aligned standards. Main risks in seasonal and temporary labour sectors rather than industrial supply chains.

Regulatory enforcement gap

EU directives generally transposed. Financial sector regulation significantly strengthened post-ABLV. Other sectors may have capacity constraints in enforcement.

Supply chain transparency

EU disclosure requirements followed. AML framework substantially improved. Beneficial ownership registers in place. Financial sector transparency now a reform success story.

Political & EU-integration risk

Strongly pro-EU and pro-NATO. Eurozone member since 2014. Coalition governments fragmented but stable. Heightened security awareness managed through alliance membership.

Payment & insolvency risk

Moderate payment discipline within CEE norms. Scandinavian bank presence (Swedbank, SEB). Investment-grade sovereign rating. Insolvency framework improved through reforms.

Logistics & Nordic connectivity

Baltic Sea location with direct shipping to Stockholm and Helsinki. 1-2 days sea freight to Nordics. Rail Baltica will further improve connectivity. Strong geographic advantage for Nordic buyers.

Governance & Rule of Law

CPI score: Latvia scores approximately 56 on the Transparency International Corruption Perceptions Index. Judicial reforms are ongoing and have been making steady progress.
Judicial reforms: Latvia has been actively reforming its judiciary and anti-corruption framework. KNAB (Corruption Prevention and Combating Bureau) has been strengthened. Progress is real but the reform process is not yet complete.
EU governance alignment: EU member since 2004, eurozone member since 2014, NATO member. Strong alignment with EU governance frameworks and transatlantic security architecture.
Buyer implication: Moderate governance risk. Judicial reforms are moving in the right direction. Governance quality is improving but has not yet reached Nordic levels.

Labour Standards Enforcement

Labour inspection: State Labour Inspectorate is active but operates with constrained resources. Enforcement is generally adequate but capacity is limited relative to the scope of the labour market.
Working conditions: Labour standards are EU-aligned. Minimum wage has been increasing. Some concerns about working conditions in construction, agriculture, and logistics sectors.
Supply chain risk: Limited large-scale manufacturing supply chains. Main risks are in seasonal and temporary labour-intensive sectors rather than industrial supply chains.
Buyer implication: Moderate labour risk. Standard EU due diligence is adequate for most supply chains. Enhanced attention warranted for labour-intensive service sectors.

Regulatory Enforcement Gap

Transposition record: Latvia generally transposes EU directives on schedule. Implementation and enforcement can lag due to administrative capacity constraints.
Environmental enforcement: Environmental enforcement is improving but capacity remains limited. Some legacy industrial sites require ongoing attention.
Financial regulation: Latvia has significantly strengthened financial sector regulation following the ABLV Bank case. FKTK (now part of Latvijas Banka) has enhanced AML enforcement substantially.
Buyer implication: Moderate regulatory gap. Financial sector enforcement has improved significantly. Other sectors may have enforcement capacity constraints.

Supply Chain Transparency

Corporate disclosure: Listed companies follow EU transparency requirements. SME sector has adequate but not exceptional disclosure standards.
Beneficial ownership: Beneficial ownership registers are in place following EU AML directives. Latvia has strengthened its AML framework significantly in recent years.
Financial transparency: Post-ABLV reforms have substantially improved financial sector transparency. Latvia has moved from being an AML concern to a reform success story.
Buyer implication: Moderate transparency risk. Financial sector transparency has improved markedly. Standard due diligence is adequate for most supply chains.

Political & EU-Integration Risk

Political stability: Coalition governments are the norm. Political landscape is fragmented but strongly pro-EU and pro-NATO. No significant eurosceptic threat.
Security environment: Baltic state with heightened security awareness following Russia's invasion of Ukraine. Strong NATO commitment and increasing defence spending.
EU commitment: Deeply committed to EU integration. Eurozone member since 2014. Active participant in EU policy processes.
Buyer implication: Low political risk. Strong EU and NATO commitment. Security concerns are managed through alliance membership rather than creating sourcing instability.

Payment & Insolvency Risk

Payment culture: Payment discipline is moderate. Some commercial payment delays occur but are within Central/Eastern European norms.
Insolvency framework: Insolvency procedures are functional and have been improved through EU-aligned reforms. Recovery processes are adequate.
Credit risk: Investment-grade sovereign rating. Banking sector is well-capitalised and now predominantly owned by Scandinavian parent banks (Swedbank, SEB).
Buyer implication: Moderate payment risk. Scandinavian bank presence provides some comfort. Standard credit terms and insurance are sufficient.

Logistics & Nordic Connectivity

Geographic position: Baltic state on the eastern shore of the Baltic Sea. Direct maritime and overland connections to Nordic markets.
Transport links: Port of Riga provides direct Baltic Sea shipping connections to Stockholm, Helsinki, and other Nordic ports. Road and rail links through Lithuania to Poland and Central Europe.
Lead times: Short sea shipping to Stockholm or Helsinki typically 1-2 days. Road freight to Finland via Estonia is feasible within 1-2 days. Rail Baltica project will further improve connectivity.
Buyer implication: Good logistics connectivity for Nordic buyers. Baltic Sea location and direct shipping routes provide competitive lead times to Scandinavian markets.

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