November 16, 2016 - Comments Off on Milburn Lewis – Making the Move Blog. Part VIII – Riga, Latvia
Milburn Lewis is a recruitment business that conducts cross-border searches for our clients, the Big 4 and other international accountancy firms. Most of the professionals we work with are not just considering a career move, but also relocation.
This week, we are concluding our three-part series exploring the Central and East European (CEE) region by travelling to Riga, the capital city of Latvia.
Riga has a great deal to offer professionals looking to gain exposure to international markets, whilst simultaneously growing and developing their career. With an exceptional work/life balance, a cosmopolitan culture, and iconic scenery, we have enjoyed helping professionals make the move to Latvia for many years.
Welcome to Latvia
The Republic of Latvia is an independent, sovereign state in the Baltic region of Northern Europe, one of three Baltic states. Like the other two Baltic states in the current series, Latvia is relatively small when compared to other countries across Europe. Latvia offers both young and seasoned professionals an open and growing economy, competitive business market, and easy access to the European single market.
Latvia is bordered to the north by Estonia, Lithuania to the south, Russia to the East, Belarus to the southeast, as well as a maritime border with Sweden. Due to its location, history, and picturesque landscape, Latvia is increasingly becoming one of Eastern Europe’s prime tourist attractions.
Like most of the countries we have explored in our ‘Making the Move’ blog, Latvia is small when compared to most world states at only 65,000 km2 (25,000 sq. mi). This means that Latvia is comparable in size to other small European states, for example Lithuania and Croatia. The total population is around 1.9 million, with about 14% of residents being characterised as ‘foreign born’.
Given the high proportion of ‘foreign born’ residents and increasing tourism levels, Latvia is becoming more and more multicultural. Latvians make up 61%, whilst Russians account for a further 25%. Jews (5%), Germans (4%), Poles (3%), and Belarusians (2%) are the next largest ethnic groups. This is very like the ethnic makeup of Estonia, which we looked at last week.
There is one official language in Latvia: Latvian. Under the constitution there are also two languages that are considered ‘indigenous’ and are spoken by a relatively small percentage of the population: Livonian and Latgalian. Per the Latvian 2011 census, 62% of residents use Latvian as their main language. Unsurprisingly, given the country’s Soviet history, there is also a high proportion of Russian speakers – around 37%. English is also widely spoken across the country, so we encourage those professionals who only speak English to not be put off considering Latvia as their next destination.
The Republic of Latvia is a parliamentary republic, with its national parliament (Saeima) based in the country’s capital, Riga. Its head of state is President Raimonds Vējonis, and its head of government is Prime Minister Māris Kučinskis. The current government is a coalition between the centre-right parties of Latvia: Union of Greens and Farmers Party, Unity Party, and the National Alliance Party.
On the 1st May 2004, Latvia became a full member state of the European Union. This affords all Latvian citizens EU citizenship and all the benefits that come with it, including freedom of movement. As a condition of membership, Latvia adopted the Euro as its currency and the The Latvian Lat was officially replaced on 1st January 2014.
The Latvian economy is characterised as being an ‘open, advanced economy’ by the International Monetary Fund. According to the Human Development Report 2011, Latvia belongs to the group of very high human development countries. Its total GDP is $48 billion, which equates to around $14,000 per capita. Prior to the great recession of 2009, Latvia was saw exponential economic growth of around 10%; however, the country did suffer a significant recession in its aftermath. Latvia has responded well in recent years and is currently seeing solid growth of around 5% per year. With its public debt at 35%, and a deficit of €200 million, Latvia does offer a competitive business environment that is receiving significant external investment from some of the world’s largest companies, including the Big 4.
Living and Working in Riga, Latvia
Riga is the capital and largest city in the Republic of Latvia, with almost 1.2 million people living in the metropolitan area and around 700,000 in the city centre. Riga is quickly becoming one of Europe’s most attractive cities because of its diverse population, museums, opera, theatres, festivals, bars, and restaurants.
Riga is particularly well-known for its opera, museums, and galleries. These include the Latvian National Opera, established in 1918; the Latvian National Theatre, established in 1919; the Mikhail Chekhov Riga Russian Theatre, established 1883; and the Daile Theatre, opened for the first time in 1920.
Although Riga is the largest city in Latvia, it is one of Europe’s – and indeed the world’s – smallest capitals. Spread over only 304 km2 it is somewhat comparable to Edinburgh, Scotland and Montreal, Canada. It has excellent public transport links, which includes of buses, trams, and trolleybuses that serve all areas of Riga.
Latvia, as well as offering an exceptional work/life balance, presents professionals with outstanding opportunities for career development. In recent years, we have seen Big 4 firms have all announced their intentions of investing heavily both in Latvia and the wider CEE region. Given that the Big 4 firms all have office in Riga, it certainly looks like opportunities will only increase in this beautiful city.
Like most European cities, there is a healthy immigrant community in Riga, attracting professionals and tourists from across the world. It is therefore highly likely that wherever you come from, you will find someone from your country of origin. Regardless, the feedback we have received from professional we have helped move to Latvia continues to highlight the welcoming nature of the Latvian people. And it is for these reasons that we believe Riga is a great choice for professionals looking to make an international move.
The Practicalities: Right to Work
Latvia has been a member of the EU since 2004. Therefore, citizens of EU member states do not require a visa or work permit to travel, reside, or gain employment in Latvia.
If you are a non-EU citizen, or ‘third-party national,’ the process does become slightly more complicated. However, most immigration experts highlight Latvia has one of the best options for non-EU citizens wishing to make the move to Europe. To live and work in Latvia, non-EU citizens are required to obtain a residency card. Currently there are two main kinds of residence permit issued by the Republic of Latvia: Permanent and Temporary.
If you are not personally connected to Latvia or anyone already there in a way which would entitle you to a residence permit (i.e. EU Citizenship, Family reunification, Family immigration, Latvian Ancestry etc.), then there still exists in Latvia three major ways to receive a residence permit:
- Residence permit based on the purchase/acquisition of real estate.
- If you are willing and able to purchase suitable property or real estate in Latvia, then you might have the option of a 5-year residence permit based on real estate purchase
- Residence permit based on investment.
- If you have funds to invest in a new or existing business in Latvia, then a residence permit based on business investment might be an option for you.
- Residence permit based on company sponsorship
- If you are offered employment by an approved Latvian business sponsor, then a residence permit based on employment might be an option for you.
Although the process is longer and more complex than it is for EU citizens, the information provided above does highlight that there are many options available to those non-EU citizens wishing to develop their career in Latvia and across the CEE region.
Practicalities: Cost of Living in Riga
Like most former Soviet states, the cost of living in Riga is relatively low compared to other cities and states in the European Union. In Riga, the main expenditures will be accommodation, transport, food, and, of course, taxes.
The relatively low cost of living is extremely attractive to professionals looking to gain valuable skills and experience outside of the larger markets such as London, Paris, and New York. For professionals we have helped move to Riga, the largest single expenditure has been accommodation. Rent for a 1 bedroom apartment in city centre Riga is around €360 per month, whilst a 3-bedroom in the same location is roughly €650 per month. For those who prefer to live outside the city centre, you’ll find a 3-bedroom apartment/house for about €400 per month.
All residents in Latvia are required to pay income tax. The current (flat) rate of tax is 24% on all income. Although this is often reduced using a large range of tax allowances in including a standard allowance of €900 per year, with an additional €1980 per year for every dependent. Social security contributions are levied on all employment income and are mandatory for most workers. The employee pays 11% of the wage, while the employer contributes 24.09%.
Although this might appear to be a relatively high tax environment for some, residents do benefit from several social benefits, including free universal healthcare. It should be noted that one can also elect to purchase private health insurance through several different providers.
Concluding Remarks: Riga, Latvia
Latvia is a city that offers Big 4 professionals the opportunity to advance their career, whilst simultaneously achieving an exceptional standard of living. If you’re committed to a move to Latvia, or simply curious to know more about our clients and the roles available, email firstname.lastname@example.org.