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Share of the shadow economy in Latvia grew to 25.5% last year
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    Share of the shadow economy in Latvia grew to 25.5% last year

    RIGA, June 16 (LETA) - The share of the shadow economy in Latvia increased by 1.6 percentage points to 25.5 percent of the gross domestic product (GDP) last year, Arnis Sauka, director of the Sustainable Business Center of the Riga School of Economics, told a conference dedicated to the shadow economy in Latvia on Wednesday.

    He noted that the shadow economy has grown since 2012 and that is not a good signal.

    "If we have not succeeded in significantly reducing the shadow economy at a time when the economy is going up, it will be even more difficult to do so now that the economy is going down due to Covid-19,'' said Sauka.

    At the same time, the share of the shadow economy in Lithuania last year increased by 2.2 percentage points - to 20.4 percent, but in Estonia the share of the shadow economy has increased by 2.2 percentage points - to 16.5 percent.

    Under-the-table wages in Latvia accounted for 23.5 percent, which is an increase of 1.2 percentage points, unreported income - 18 percent, which is an increase of 1.4 percentage points. In turn, the non-disclosure of employees reached 10.9 percent, which is the same as in 2019.

    Last year, the largest share of the shadow economy was in Kurzeme - 27.1 percent, in Riga it was 26.3 percent, but the smallest share was in Latgale - 19.2 percent.

    By sectors, the largest share of the shadow economy was in construction - 28.7 percent, which is a decrease of 4.6 percentage points, and in wholesale trade - 25.3 percent, which is a decrease of 0.8 percentage points. Last year, the share of the shadow economy in the services sector was 24.9 percent, in retail trade - 23.9 percent, but in manufacturing - 23 percent.

    Since 2009, since the survey has been conducted, the largest share of the shadow economy in Latvia was observed in 2010 - 38.1 percent of GDP, but the smallest share of the shadow economy was in 2016 - 20.7 percent of GDP, followed by the share of the shadow economy seeing an increase in 2017 and 2018 and a slight decrease in 2019.

    In 2019, the share of the shadow economy in Latvia decreased by 0.3 percentage points and reached 23.9 percent of GDP.

    • Published: 16.06.2021 14:25
    • Ivars Motivāns, LETA
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    • © The given news may not be republished in any way or amount, or otherwise used by the mass media or Internet websites, without written permission of LETA. If this provision is not observed, the matter will be taken to court pursuant to the laws and regulations of the Republic of Latvia.
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