Situated in the center of the Baltic States, Latvia is a small country with a population just under two million. With Europe to the west and Russia to the east, Latvia is ideally positioned for commerce, transportation and logistics.
Separated from the Soviet Union in 1991, one of the first things the newly independent country did was to pass the Law of Education. The school system was revamped to roughly follow the European model. Latvians realized that education was the key to improving their country after it threw off the shackles of the Russian school system.
Since 1991, Latvia has gone on to join the European Union (EU) and NATO and to carve out a niche for itself. It also has an “open for business” policy that makes it easy for foreign investors.
In terms of the big picture, what element connects business, trade and development? The answer is education and Latvia prides itself on having a literate workforce. This triumph was realized through the hard work of restructuring the school system and government policy.
THE SCHOOL SYST
Schooling in Latvia starts with pre-school education and then goes on to nine years of what is termed basic education. At the secondary level, students have a choice of whether to follow an academic or a vocational program.
Preschool and the nine years of basic education are free and compulsory until the age of 15. By 1996, the enrollment rate has reached 95.8 and has increased since. According to UNESCO, Latvia spends about five (5) percent to five and a half (5.5) percent of its GDP on education. This is higher than the 3.8 average for OECD countries.
Tertiary level studies include first and second level professional higher education options. These translate as roughly bachelors and masters’ degrees. Specialized studies in medicine, pharmacy and dentistry take five to six years. The equivalent of a Ph.D. takes an additional three or four years and involves the public defense of a thesis.
Grading – and the exams are often oral – is done on a scale of one to 10. It is rare that 9 or 10 are given as it indicated superior knowledge. On the other end of the scale, 1 and 2 are virtually never awarded. Instead, 8 is excellent, while 7 is good. Next 6 comes in as almost good, while 5 slides to fair and 4 is slightly satisfactory while a drop to 3 is unsatisfactory.
Students are drilled and expected to be able to memorize large tracts of information. Computers are slowly making an inroad into the Latvian school system but are not as prominent as they are in the western world. Computers – as they are imported – are expensive.
As well as secondary and tertiary level education, there is an encouragement in Latvia for in-house training for the workforce. This may involve anything from a workshop on how to use a new type of computer software through to an on-going mentoring program for promising employees.
Keeping employees up to date with developments is in the interest of the companies as it results in a more productive workforce. Another perk is that people who receive in-house training tend to stay in their jobs longer, which is another stabilizing factor for investors.
CONNECTIONS BETWEEN BUSINESS AND EDUCATION
As globalization and international trade continue to gain momentum at an unprecedented rate, education is increasingly important. To advance and develop, there is no doubt that a country needs educated workers. One way to quickly assess a country is to look at the literacy levels of its labor force.
People with professional or vocational training are better suited to work without constant supervision and tend to be better able to plan their time at work, which increases the production level.
Having an education also gives workers better wages and bargaining power.
In today’s world of technology, the Internet and computers, employees need to be educated to deal with the daily demands of using critical thinking skills. The traditional pick-and-shovel jobs have been replaced by machines and employees without education and training are lagging behind.
WHAT DOES EDUCATION MEAN FOR FOREIGN INVESTORS?
One of the reasons for investing in Latvia is because the country has an educated workforce. The wages are still relatively low with $417 being the minimum wage and $748 the average salary. Translated that means that investors can hire quality, educated people for less than in many other countries, making Latvia an attractive option.
Another important aspect of education is that a significant number of Latvians – particularly the under 40s who live in Riga, the capital city — speak English, the lingua franca of business. Although Esperanto was a great idea in theory, it never took off and English edged in as the must speak language of technology, business and commerce.
The Latvians recognize this and are working on improving their English skills.
As Latvians increasingly place more importance on education, they become a more vibrant and viable destination for foreign investment. This is consistent with their “open for business” policy and it is driving the country forward.
Small but educated sums up the situation in this Balkan country.