RIGA, June 27 (LETA) - Despite geopolitical challenges and the severing of historical ties with aggressor states, Latgale is demonstrating strong resilience, the Ministry of Economics has concluded.

The ministry reported that during today’s government field session in Latgale, the ministry presented ministers with a comprehensive report on promoting economic activity in the country’s eastern border region and an informative report on strengthening the protection of manufacturing facilities against threats posed by remotely controlled devices.

As explained by the ministry, the measures presented at the government meeting are aimed at improving the region’s security, attracting targeted investments, and enhancing residents’ quality of life.

After analyzing the region’s economic situation, the Ministry of Economics concluded that, despite geopolitical challenges and the severing of historical ties with aggressor states, Latgale is demonstrating strong resilience. In 2024, there were 18,000 economically active businesses operating in the region, which is 3.8 percent more than in 2021.

To promote further growth, the Ministry of Economics has allocated a total of EUR 187.5 million for the development of the eastern border region, introducing special conditions and incentives for receiving funding.

According to information provided by the ministry, several large investment projects are already underway in Latgale in the wood processing, bioeconomy, and energy sectors, including at companies such as Verems, Nordic Elite, and Biofactum.

Similarly, four major investment projects in the eastern border region have been supported with a capital subsidy of EUR 32.5 million. In addition, since May of this year, entrepreneurs in border regions have had access to a special interest-free loan and guarantee program, under which the first 36 applications have already been approved.

The ministry promises that significant support is also planned for the development of the defense industry and dual-use products, where the total planned investment amounts to EUR 690 million.

In August, the new REARM program will be launched, offering loans with a capital discount of up to EUR 20 million and guarantees with a capital discount of up to EUR 25 million, while a EUR 120 million Capital Fund for Growth and Security is scheduled to launch at the end of the year.

The Ministry of Economics also reported that mortgage loans have been available in the regions since the fall of 2025, and 99 applications for home purchases have already been received in the eastern border region. In addition, 334 social housing units are planned for nine municipalities, and a new rental building is under construction in Aluksne. In total, 484 housing guarantees have already been issued to families and young professionals in the region.

Additional funding of EUR 1.5 million has been allocated for the recovery of the tourism sector in 2026, with Latgale designated as a priority target. Activities include marketing campaigns in Lithuania and Estonia, visits by foreign media, and the promotion of Latgale’s offerings in the Japanese tourism market.

During the field visit, Minister of Economics Viktors Valainis (Greens/Farmers) and State Secretary of the Ministry of Economics Raivis Bremsmits visited two manufacturing companies in Latgale - Verems and Avoti.

During the visit, the officials toured the new production facilities at both companies, which were established with state support for large-scale investment projects.