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Trade Finance
Contents
1. Latvia
1.1 General data
1.2 Economic performance
1.3 Banking industry
1.4 EU membership
2. Transit
3. Trade finance
Latvia
LatviaGeneral data
Area: 64,600km²
Population:
Currency:
Language:
Ethnic composition:
2.23 million
Latvian lats 1 EUR = 0.7028 LVL
Latvian, Russian, English
Latvians 57.7%Russians 29.6%Belarusians 4.1%Ukrainians 2.7%Poles 2.5%
ESTONIA
FINLAND
RUSSIA
BELARUS
UKRAINE
РУМЫНИЯ
POLAND
LITHUANIA
BALTIC SEA
LATVIA
Latvia Economic
Performance 2010
Real GDP: USD 17.2 billion
Unemployment:
Inflation:
18%
-1.4%
LatviaBanking Industry
21 local banks / 10 foreign banks
Total assets (m LVL):
LatviaEU Membership
EU member state since 1 May, 2004
Benefits of EU membership:
Participation in the Customs union
cancelation of duties and quantitative restrictions
Unite foreign trade policy
Unite policy for the development of economicallydepressed regionsFree movement (incl. labour force)
Standardising legislation and social institutes
is planned to be introduced in Latvia starting from 1 January, 2014
Transit
Ports Oil Pipelines
Railways Air Transport
ESTONIA
FINLAND
RUSSIA
BELARUS
UKRAINE
RUMANIA
POLAND
LITHUANIA
BALTIC SEA
LATVIA
LatviaTransit
Three largest ports operating in Latvia:Riga, Ventspils and Liepaja
RIGA VENTSPILS LIEPAJA
Port area
HarbourageOverall berths lengthMaximum draught
1,962ha
4,386ha13,818m12.2m
2,208ha
243ha11,012m15m
385ha
819ha10,000m9.5m
RIGA
VENTSPILS
LIEPAJA
Ports Oil Pipelines
Railways Air Transport
LatviaTransit
Cargo Turnover in Latvian Ports (in thousands of tonnes)
Dry bulk Bulk liquids General cargo
Ports Oil Pipelines
Railways Air Transport
LatviaTransit
Oil Pipelines
Two oil pipelines operating in Latvia:
Polotsk-Ventspils oil pipeline (1968), with a capacity of 16 million tonnes per year
Polotsk-Ventspils oil products pipeline (1971), with a capacity of 5 million tonnes per year
In addition there is the Polotsk-Biržai-Mažeikiu oil pipeline parallel to the Polotsk-Ventspils oil pipeline.
VENTSPILS
Ports Oil Pipelines
Railways Air Transport
LatviaTransit
Railways
In 2009 the total volume of cargo turnover on Latvian railroads was 49.2 million tonnes.In 2010 the transit cargo turnover was about 41 million tonnes (-14.6%).
RIGA
VENTSPILS
LIEPAJA
Ports Oil Pipelines
Railways Air Transport
LatviaTransit
Currently railway transport generates 52% of overland transportation in Latvia and the proportion is increasing. 82% of traffic is generated by transit traffic.
Rail-Baltica (2020)Helsinki-Tallinn-Riga-Warsaw-Berlin
Ports Oil Pipelines
Railways Air Transport
Latvian railways transit turnover (thsnd. Tons)
LatviaTransit
Air Transport
There are two international airports in Latvia:Riga and Liepaja.
Riga International Airport:
Passengers (2010):
Flights (2010):
Cargo (2010):
4,664
68,145
12,247t
82 destinations are available
RIGA
LIEPAJA
Ports Oil Pipelines
Railways Air Transport
LatviaTransit
Riga International Airport (RIX) passenger turnover (in thousands)
Ports OilPipelines
Railways Air Transport
LatviaTransit
Cargo Traffic atRiga International Airport (tonnes)
Ports Oil Pipelines
Railways Air Transport
TradeFinance
LIEPAJA
RIGA
VENTSPILS
LatviaTrade
Finance
Latvian Ports
Cargo turnover in ports of Riga, Ventspils and Liepaja in 2010:
Free port of Riga: 30.5 million tonnes(mostly containers and bulk products)
Free port of Ventspils: 24.8 million tonnes
Free port of Liepaja: 4.4 million tonnes
Over 70% of the cargo turnover of Latvian ports is transit cargos from and to CIS countries.
LIEPAJA
RIGA
VENTSPILS
4,4
24,8
30,5
LatviaTrade
Finance
Rietumu Trade Finance
Rietumu Bank finances export-import operations with the inventory stored at or transferred via the Latvian ports of Riga, Ventspils and Liepaja.RIGA
VENTSPILS
LIEPAJA
LatviaTrade
Finance
Credit lineagainst warehoused goods
Trading company:Buys inventory at its own expense and deposits them at the approved custom warehouse (at the approved freight forwarder) in the port of Riga.
The Bank:Having received notification from the warehouse or surveyor regarding inventory stored at the warehouse, the bank grants a loan to the company.
Warehouse (freight forwarder):Secures the storage of the goods for the client (the trade company), serving the interests of the bank.
LatviaTrade
Finance
Credit lineagainst warehoused goods
Trade company:Arranges the dispatch of the goods at its own expense or at the expense of the supplier (the final destination being Latvian ports).
The Bank:Having received the bill of lading confirming the dispatch of the goods, the bank grants a loan to be repaid when the goods arrive to the destination port or, if the goods are further deposited within a previously approved customs warehouse in the Baltic countries, prior to receiving the goods from the warehouse.
LatviaTrade
Finance
Export factoring
Factoring – financing provided by the bank to those companies which work on deferred payment conditions with their buyers.
The Bank finances the Trading Company for the deferred payment term provided to the Buyer. As a rule, the buyer’s liabilities must be guaranteed by a letter of credit or a guarantee from the approved bank.
LatviaTrade
Finance
Financing imports and exports
Priority goods include:
Oil productsWheat Metals
Coal Wood chips
Deep-frozen goods -meat, fish, poultry, etc
Electronicsand other consumer goods
(up to 80%)
(up to 70%)
(up to 80%)(up to 80%)
(up to 80%)
(up to 60%)
(up to 50%)
Rietumu is open to considering the financing of other goods.
Major requirements:
The company must be a customer of the bank for a minimum three months;
LatviaTrade
Finance
Any application for financing must conform to the following criteria:
The company must have stable turnover at Rietumu Bank* and a stable financial position;
The company’s experience in the financed goods trading field at least a year long;
The company must co-finance the transaction by 20-50%;
The transaction goods must be liquid, with a remaining shelf-life of twelve months or more;
The goods must be stored at a warehouse which is approved by the bank;
The goods must be insured.
This requirement is not applied to clients who present their official financial statements to the bank where these fully reflect their operations during the last two years, on the condition that all turnover be transferred to Rietumu.
Credit Terms
Proportion of financing: 50-80% of the cost of the goods
LatviaTrade
Finance
Minimum loan amount: EUR 200,000.00
Credit line period: 3-12 months
Rate: 8-10% per annum
Foreign Trade Payments
Letter of Credit
LatviaTrade
Finance
Guarantee
Document collection
Contactinformation
+371 6702 5263
LatviaTrade
Finance
Trade Finance Department
www.rietumu.ru
Thank you for your attention
