Chapter 7. Latvian Agricultural Innovation System
This chapter describes the Latvian Agricultural Innovation System and outlines recent changes. It first provides an overview of the general innovation system; describes agricultural innovation actors and their roles in the system; outlines changes in roles and changes in themes; presents main policy instruments and monitoring mechanisms; and discusses views in the general public on agri-food innovations. It then describes main trends in public and private investments in R&D, mechanisms of funding and mechanisms to foster knowledge markets and networks. The next section presents an overview of policy incentives for the adaption of innovation, outlines the role of training and advisory services at farm level, and provides some information on adoption rates in primary agriculture and food processing. Finally, the last section outlines the participation of agricultural R&D actors in regional and international co-operation.
7.1. General innovation profile
Agricultural innovation systems (AIS) are increasingly integrated in the economy-wide innovation system. Innovations in processes and organisations, developments in Information and Communications Technology (ICT) are relevant to all sectors and a well-functioning AIS can help ensure good use of public funds, improve collaboration between public and private participants, including across national borders, and a more demand driven system that is responsive to the needs of “innovation consumers” (OECD, 2015).
General innovation framework
Latvia has three national horizontal strategic planning documents that encourage innovation, entrepreneurship and sustainable development (see Annex 3.A for more details). More specifically, Latvia 2030, which is the long-term framework law, encourages export-oriented and innovation based growth through policy instruments that facilitate research co-operation between scientists and businesses, promote innovation programmes and participation in international R&D. In the context of the agriculture sector, Latvia 2030 emphasises a more efficient use and management of Latvia’s natural resources capital (Parliament of the Republic of Latvia, 2010).
The NDP 2020 (Annex 3.A), implements the directions set in Latvia 2030 to develop a highly productive and internationally competitive business sector as well as research- and innovation-based jobs. It harnesses new technologies to use natural resources more efficiently and sustainably. In relation to innovation, the NDP 2020 attempts to approach the Europe 2020 strategy1 goal to invest 3% of the EU gross product in R&D and seeks to increase R&D investment to 1.5% of GDP by 2020 (MoE, 2011). While there has been no progression of the ratio from 0.6% in 2008, euro-value figures have increased in line with GDP growth (EC, 2016b). Also in support of Latvia’s innovation capacity, the NDP 2020 aims to improve the research infrastructure, facilitate co-operation between higher education, science and the private sector and ease research and innovation take-up by businesses; commercialise innovation through patents, encourage the creation and production of high added-value innovative and internationally competitive products (NDP 2020, 2012).
The Guidelines for the Development of Science, Technology and Innovation for 2014-2020 (ZTAI) developed by the Ministry of Education and Science set the investment trajectory to reach these objectives. The ZTAI sets the innovation policy objectives and action lines necessary to upgrade Latvian science, technology and innovation to a competitive level (MoES, 2013b). It defines the funds required (government and foreign financial instruments), supporting tax initiatives and identifies indicators to monitor progress. The document includes the Research and Innovation Smart Specialisation Strategy (RIS3) that provides for the consolidation of research and innovation resources in five knowledge areas where Latvia has comparative advantages, with the objective to achieve science and technology driven economic growth.
The five areas are:
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1. A knowledge-based bioeconomy
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2. Biomedicine, medical technologies, biopharmacy and biotechnologies
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3. Smart materials, technology and engineering systems
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4. Smart energy
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5. ICT
At the sectoral level, the main strategic document is the Guidelines for National Industrial Policy 2014–2020. This medium-term policy planning document covers all sectors of the economy and defines the goals and directions of economic growth promotion. The guidelines identify the key national priorities, action lines and activities focused on sectoral development, availability of financing, innovation and export promotion as well as the improvement of the business environment. The guidelines put forward four elements of particular relevance to innovation: knowledge capacity, innovation supply, innovation demand and business take-up of innovation (MoE, 2013).
The Latvian Bioeconomy Strategy 2030 (LIBRA) is the long-term (2030) national strategy enabling a knowledge-intensive bioeconomy. LIBRA was developed by the MoA in co-operation with researchers of the Latvia University of Life Sciences and Technologies (LLU). It will deliver Latvia’s contribution to EU objectives set in flagship initiatives such as the “Innovation Union” and the “Resource Efficient Europe” under Europe 2020 and in the European Bioeconomy Strategy and its associated Action plan (MoA, 2017a). The Latvian bioeconomy sectors are to contribute high value added to the economy, increase exports and employment. And, at the same time, enhance environmental quality, including biodiversity and contribute to climate change mitigation and adaptation. By 2030, the sectors’ production would weigh more than EUR 9 billion and employ 128 000 people (MoA, 2017a).
A number of measures under Latvia’s Rural Development Programme 2014-20 (RDP) under the CAP also contribute to the competitiveness of the sector by improving the infrastructure and on-farm management capacity through advisory and training services. More broadly the RDP contributes to innovation capacity, improved environment and mitigation of and adaptation to climate change (MoA, 2013).
General innovation performance
Opportunities for progress exist for Latvia’s innovation performance (EC, 2016a and OECD, 2016). In general, the innovation level in Latvia is relatively low, as shown both in the European Innovation Scoreboard 2018 (EC, 2018) and the Global Competitiveness Report 2017–2018 (WEF, 2017a).
The European Innovation Scoreboard 2018 notes improved performance since 2010 in all composite indicators. It also identifies a number of areas of the innovation system in Latvia where performance has declined; including firm investments, SME innovation, intellectual assets and trade. Based on the indicator of highly cited scientific publications, Latvia, Croatia, Bulgaria and Romania appeared to be EU Member States with a weaker science base. Latvia also had a very low R&D intensity and innovation output indicator.
The Baltic Innovation Fund (BIF) is a ‘Fund-of-Fund’ initiative of the European Innovation Fund (EIF). It brings together funding from the governments of Lithuania, Estonia and Latvia (operated by Altum in Latvia) to boost innovation equity investments in Baltic SMEs over 2013-17. The BIF is endowed by EUR 130 million to which the EIF contributes EUR 52 million and each participating Baltic partner EUR 26 million on par (BIF, 2018).
Issues identified by the OECD Science, Technology and Innovation Outlook 2016 include the unfavourable business environment, the insufficient supply of venture capital as well as the insufficient government expenditure in R&D; all indicators are below the average OECD index (OECD, 2016).
Notes: 1. Universities and public research: (a) Public R&D expenditure (per GDP), (b) Top 500 universities (per GDP) and (c) Publications in the top journals (per GDP).
1. R&D and innovation in firms: (d) Business R&D expenditure (per GDP), (e) Top 500 corporate R&D investors (per GDP) and (f) Triadic patent families (per GDP).
2. ICT and Internet: (g) Fixed broadband subscriptions (per population), (h) Wireless broadband subscriptions (per population) and (i) E-government development index.
3. Networks, clusters and transfers: (j) Industry-financed public R&D expenditure (per GDP).
4. Skills for innovation: (k) Tertiary education expenditure (per GDP), (l) Adult population at tertiary education level (%), (m) Top 15 year-old performers in science (%) and (n) Doctoral graduate rate in science and engineering (%).
Source: OECD (2016), “Latvia”, in OECD Science, Technology and Industry Outlook 2016, https://doi.org/10.1787/sti_in_outlook-2016-en.
All indicators related to the gross domestic expenditure in R&D (GERD) as a percentage of GDP point to low performance compared to the OECD averages and are closer to the OECD bottom 5 performers (Figure 7.1). Latvia spent about 0.6% of GDP on R&D in 2015, which is about half Latvia’s target and three times less than the averages in EU28 (1.96%) and well below the OECD countries’ average (2.4%) (OECD, 2017). Furthermore, the number of triadic patent families and publications in the top journals per GDP is much lower than in OECD countries in average. The share of Latvian business R&D in GDP (0.24%) is also below the OECD median (1.63%) and lower than the EU average (1.23%) (OECD, 2014).
The facts are acknowledged and corrective actions are needed to eliminate deficiencies and promote mutual interaction between all innovation systems stakeholders – business, science and education as well as financial and legislative systems (MoES, 2014a).
Communicating science
Efforts to promote science mostly use traditional channels such as journalism (newspapers, magazines, TV, radio) and events; fragmented use is made of web-based tools. Well known researchers contribute to popularising discoveries and inventions through radio and TV programmes. Innovation in agriculture including the sustainable use of land resources, healthy food production, creation of new products and technologies, are among the scientific topics covered. The Ilustrētā zinātne (Illustrated Science) is Latvia’s most popular science magazine (Vīķe, 2015). Every month, the Lauku Lapa (Rural Magazine) reports on news stories in rural development and agriculture and on regulatory developments. It is prepared by the National Rural Network (VLT) and is also available in electronic form as Lauku e-lapa (Rural E-Magazine) (VLT, 2017). More than 5 000 paper copies are distributed throughout Latvia, 14 000 recipients receive the e-magazine and 172 000 users have visited the VLT homepage in 2017 (of which 92 114 had previously visited and 80 768 were new).
Events are frequently organised to communicate on science, including public lectures, debates, science cafés and festivals. Higher education institutes (HEI) often initiate and organise such events. Examples in Latvia include Science Café discussions and “LU Open Minded” lecture cycles organised by the University of Latvia to engage with the audience in an informal setting. The annual European Researchers’ Night is important in promoting science to the general public. The event offers an opportunity to showcase scientific achievements in an attractive way and to participate in different experiments and simulations with scientists and to exchange ideas. The leading Latvian universities, scientific institutes and other research-related organisations in Latvia take part in the event. National authorities often collaborate with non-governmental organisations, for example, since March 2014, the Young Scientists Association, in co-operation with the Boris and Ināra Teterev Foundation and the Latvian Academy of Sciences, travels to regional schools, colleges and universities to speak about science and scientists.
Every year international exhibitions (fairs) in agriculture are organised. The Riga Food fair, in September, is the most popular event. It brings together food producers from across Latvia and other countries, and offers networking opportunities to agricultural producers, food manufacturers, scientists and research institutions and consumers. In 2017, 720 companies from 35 countries presented their products to 40 000 visitors. Other agricultural fairs include the Spring and the Autumn fairs, organised by the Exhibition service A.M.L. Ltd in co-operation with the MoA where farmers can be informed about farming techniques, agrochemical and soil science solutions, animal husbandry, livestock, farm equipment, fodder harvesting technologies, novelties in horticulture, etc. Seminars and discussions about innovations in agriculture are organised (Pavasaris, 2018, Rudens 2018). Nature Expo agricultural international fair (international agriculture, horticulture and forestry fair) and TechIndustry (international exhibition of mechanical engineering, metalworking, automation, electronics, electrical engineering, production materials, instruments and new technologies) are also well-known fairs.
Agricultural organisations and associations, as well as scientific institutions and research farms organise annual seminars, Rural Days and demonstration events to inform farmers about news in various agricultural sectors. The LLU scientific institutions regularly organise Rural Days devoted to particular cultivated plants and growing these plants. Thus, the LLU Institute of Horticulture performs the Interreg Baltic marine region programme project “Non-technological and Technological Innovation Capacity Development in Growing and Processing Fruits in the Countries of the Baltic Region”, which includes the organisation of Rural Days at the Institute’s garden several times a year. Similar activities are performed in all agricultural sectors, including cattle breeding. Thus, the Animal Breeders’ Association of Latvia in collaboration with the LLU study and research farm “Vecauce” annually organises events for popularising the dairy sector “Cow Festival”.
Agricultural competitions take place annually. The Sējējs (Sower) prize, organised by the MoA for the past 25 years, celebrates a lifetime contribution to agriculture. Other prizes include “Farm of the Year”, “Food Production Company of the Year”, “Young Successful Farmer”, “Organic Agriculture”, “Science in Practice, Innovation”, etc. The “Environment Science Award” has several categories, including the “New Environmental Scientist” and the “Bioeconomy Prize” which rewards the production of an innovative product with high added value. The Latvian Academy of Sciences organises several competitions and awards prizes for contribution to the development of science.
The LLU organises the annual awards ceremony “Entrepreneur for the Future” to honour entrepreneurs in Latvia, who, in co-operation with LLU scientists, have contributed innovations to the economy or Prizes are awarded in three categories, including bio-science – for contribution to agriculture, forestry and veterinary medicine research and/or studies. The LLU in co-operation with local governments also organises regional scientific contests for high school pupils (in grades 10, 11 and 12). An annual conference is also organised where students can present their research work, covering various research themes including agriculture, environmental and earth science, biology, etc.
Several science centres, ZINOO, have opened in Latvia with the support from the European Economic Area and Norway Grants.2 They offer interactive exhibitions where visitors take part in scientific experiments. The ZINOO also take part in the Days of Technical Innovation in co-operation with the Riga Technical University.
Up to September 2017, the EU framework Programme for Research and Innovation “Horizon 2020” had supported 20 projects in Latvia (Horizon 2020).
7.2. Actors, institutions and governance of agricultural innovation systems
The AIS involves a wide range of actors who enable, guide, fund, perform, implement, inform and facilitate innovation (Annex Table 7.A.1). The key players include policy-makers, researchers, teachers, advisors, farmers, private companies, consumers, non-profit organisations, and markets (OECD, 2015). The Latvian AIS involves the traditional providers of research, extension and educational organisations, which are structured and governed through agricultural, science and education policies (Figure 7.2). Various formal and informal learning and innovation networks are present, which often connect knowledge actors of different organisational and sector backgrounds (Tisenkopfs et al., 2011).
The transition to an innovative economy requires strengthening the Latvian innovation system by overcoming deficiencies and promoting interaction between all stakeholders in the innovation system – entrepreneurs, science and education as well as financial and legislative systems (MoES, 2013b).
Source: LLU, based on Zēverte-Rivža et al, 2015.
Government
The government manages the innovation system; it elaborates the innovation policy, and monitors and implements innovation programmes. It contributes funds to R&D and education budgets, and innovation support to businesses. Together with the Latvian Association of Local and Regional Governments (LPS) the government distributes funds for agricultural programmes, promotes local production in local markets, etc.
Monitoring and evaluation mechanisms are the same as for all policies and institutions in Latvia. However, no mechanism is in place to evaluate the performance of the whole food and agriculture innovation system.
The Ministry of Economy (MoE) defines the innovation policy and co-ordinates its implementation. The Investment and Development Agency of Latvia (LIAA) promotes business development by facilitating more foreign investment as well as increasing the competitiveness of Latvian entrepreneurs in both domestic and foreign markets.
The Ministry of Education and Science (MoES) elaborates the science and technology development and innovation policy and co-ordinates its implementation. In the process, the MoES co-operates with the MoE and other sectoral ministries, and consults sectoral associations and social partners when necessary.
The Ministry of Welfare (MoW) develops national policy for the reduction of unemployment, participates in the development of employment policy and the improvement of the career development support system, as well as co-ordinating the development of proposals for active employment measures (including training of the unemployed).
The Public Employment Service of Latvia (NVA) provides assistance to the unemployed, job seekers and people at risk of unemployment to promote their competitiveness in the labour market according to their needs and abilities. The Service implements and administers active labour market policy measures to reduce unemployment.
The MoA develops and organises the implementation of agricultural, forestry and fisheries policy. Under the MoA, the LLU and its subordinate public entities lead scientific centres in bio-science and create innovation in agriculture and in the food industry. These include the Institute of Horticulture and the Institute of Agricultural Resources and Economics – and the LLU LLC Latvian Plant Protection Research Centre and the Institute of Food Safety, Animal Health and Environment.
The Rural Support Service, is the National regulatory institution subordinated to the MoA and operating in the field of agriculture. It make significant contributions to the agricultural innovation system by assessing and disbursing EU and national support funds and accounting and controlling of their use.
Every year the MoA signs a memorandum of agreement with the Latvian Academy of Agricultural and Forestry Sciences (LAAFS). The two institutions join efforts in linking higher education, science and practice, research in the field of agriculture, rural development and forestry science, organisation of joint conferences and other events, popularisation of scientific achievements, information exchange between scientific structures, farmers’ organisations and experts, promotion of international scientific collaboration as well as implementation of other significant measures (LAAFS, 2017).
Research, education and knowledge
In 2015, 91 scientific institutions were registered in the Register of Scientific Institutions in Latvia, covering all science disciplines. Of those scientific institutions, 15 worked on agricultural research topics, 8 of which are State-funded and receive basic research funding to cover the basic infrastructure and administration costs (MoES, 2015b).
After an external evaluation performed in 2013 and following its recommendations, the MoES consolidated scientific institutions in 2015 into the Strategic Alliance of Bioeconomy Research (MoES, 2015c). In the sector of agricultural sciences (similarly as in other disciplines) the number of scientific institutions was reduced in 2015 and bigger research units were created:
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Four crop farming research institutes (the State Priekuli Plant Breeding Institute, the State Stende Cereals Breeding Institute, the Latvian State Institute of Agrarian Economics, LLC “Latgales Lauksaimniecības zinātniskais centrs” (Latgale Scientific Centre of Agriculture) were consolidated into the Institute of Agricultural Resources and Economics; a derived public entity attached to the LLU.
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The Latvia State Institute of Fruit-Growing was merged with other public and private scientific institutes to create the Institute of Horticulture; a derived public entity attached to the LLU.
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The Research Institute of Agricultural Machinery and the Research Institute of Agronomy were attached to the LLU (MoES, 2014c).
These changes were aimed at decreasing the fragmentation of funding and increasing the research excellence and the international competitiveness of the scientific institutions in Latvia. The reforms were supported by EU structural funds (ERDF) co-funding.
The Strategic Alliance of Bioeconomy Research (BPSA) facilitates R&D in the agro-food sector. It was established in September 2014 and consolidated in 2015 (as described above). The BPSA consists of 8 scientific institutions related to agriculture, food production, forestry and fisheries (Table 7.1). It co-operates with the industry to develop new internationally competitive products and innovative production methods for manufacturing, and to expand the intellectual capacity of the sector (MoA, 2016).
The Latvia University of Life Sciences and Technologies (LLU) is one of the six universities in Latvia. The LLU implements research in different sectors of the economy specialising in bio-science (agriculture, veterinary medicine, forest science), engineering (food technology, agricultural and forestry engineering, environment and water management, land management and land surveying, landscape architecture and planning, construction); sustainable rural development and environmental protection (regional impact of climate change and adaptation and social sciences agrarian and environmental economics, regional development and administration). The LLU also implements study programmes in agriculture, forestry, veterinary medicine, woodworking, biomaterials based construction, power engineering based on the use of renewable resources, water treatment and distribution, water and land resources management, nature tourism, food industry and biochemistry, ICT (LLU, 2016). The LLU’s development strategy for 2015-2020 underlines the importance of developing and enacting national, international and interdisciplinary research projects to develop new technologies and innovations and integrate them into the study curriculum it dispenses (LLU, 2015).
LLU scientists work in the united European Research Area (ERA), developing the potential of scientific activity for conducting national and international research. They also promote the introduction of innovative, knowledge-based and economically efficient technologies in Latvia’s economy, especially in the bioeconomy, which is one of Latvia’s RIS3 areas.
The LLU Advisory Convent (Board) brings together 17 representatives of several sectoral companies and associations who have advisory rights in the university. The Board takes strategically important decisions and secures ties between society and university. The LLU Convention is elected by the LLU Senate, and the meetings are held not less frequently than twice a year. Adviser proposals and decisions are published on the LLU website.
The Institute of Agricultural Resources and Economics was setup by bringing together three agricultural research institutes; the State Priekuļi Plant Breeding Institute, the State Stende Cereals Breeding Institute and Latvia State Institute of Agrarian Economics. The new institute is supervised by the LLU. The AREI covers the sustainable use of agrarian resources and rural area development. Its long-term objective is to create new knowledge in the field of bioeconomy and enhance the agricultural and food sector competitiveness and sustainability. Its activities include scientific research work in cereals breeding, grain cultivation and other fields of organic and conventional farming. It explores new knowledge, new products and innovative technologies in crop production and provides scientific basis and expertise in various sectors of crop production (AREI, 2017; AREI, 2016).
The Institute of Horticulture (DI) is the leading fruit-growing research institution in Latvia. It has become the centre of the horticultural science in Latvia, performing topical and priority research in the field. It creates knowledge, develops new products and innovative technologies that support the competitiveness of Latvian horticulture and its processed products in the context of sustainable rural development The research results are regularly passed on to Latvian commercial fruit growers and the fruit processing industry as recommendations, innovative products and technologies (DI, 2016). The Latvian Plant Protection Research Centre carries out scientific research work on plant protection in the agro-climatic conditions of Latvia (LAAPC, 2016).
The Institute of Food Safety, Animal Health and Environment (BIOR) is a national research centre that develops innovative research methods and creates new “applicable” knowledge in the field of human and environmental health, food, fisheries and veterinary medicine sciences (BIOR, 2015). It offers a large variety of scientific work – fundamental and applied studies as well as the development of methods and technologies for fostering human, animal and environmental health, animal welfare, safe food circulation and for preservation of fish and water resources. The Institute covers chemistry science, environmental science, public and environmental health, fisheries and veterinary medicine science. The Institute co-operates with educational institutions, governmental institutions, companies and scientific institutes in Latvia and abroad (BIOR, 2017).
The LLU’s Technology and Knowledge Transfer Division facilitates knowledge transfer and co-operation between scientists and commercial associations. It also ensures the protection of intellectual property and the marketing of LLU research results (LLU, 2016).
The Latvian Rural Advisory and Training Centre (LLKC), leads agricultural and rural business advisory services in Latvia with offices in 26 regional cities. The LLKC has a consultative and educational role in relation to the implementation and transfer of innovation in the agricultural sector in Latvia (LLKC, 2016). It is established by the MoA and Latvian Federation of Farmers. In 2016 it had more than 22 000 customers and partners, the average number of employees was 440, and its turnover EUR 8.7 million (paid service and public funding ratio – 50-50). The LLKC educates, informs and carries out research. It provides advice to rural entrepreneurs, organisations and people operating in agriculture, fishery and other fields of rural business. Its services relate to production processes, accounting and business planning (LLKC, 2016).
In 2008, the LLKC initiated the VLT to inform the public and potential beneficiaries about the rural development policy and funding opportunities, to promote innovation in agriculture, food production, forestry and rural areas, to facilitate setting-up rural businesses and co-operation among rural populations and organisations involved in rural development and the regulatory authorities. The Latvian VLT has an open membership to natural and legal persons engaged in rural development. It brings together agricultural and forestry organisations, local action groups, environmental organisations, non-governmental organisations in rural areas, municipalities, youth organisations, research institutes, etc. In 2017, there were approximately 18 000 participants in VLT organised events. The VLT publishes the Lauku Lapa (Rural Magazine) and the electronic Lauku e-lapa (Rural E-Magazine) (VLT, 2017).
Other scientific institutions – the University of Latvia (LU), the Riga Technical University (RTU), the Riga Stradins University (RSU), the Daugavpils University (DU), and the Latvian Institute of Aquatic Ecology (LHEI) – provide indirect contributions to the development of the bioeconomy science.
Two public colleges (Jekabpils Agro-business College and Malnava College) specialise directly in vocational study in agriculture and agro-business; other vocational schools provide secondary vocational education in agriculture-related study programmes (more information on agricultural education in Chapter 5). The Malnava College offers the first level higher professional education in agriculture through its “Entrepreneurship in agriculture” study programme and trains qualified business specialists in agriculture (Malnava College, 2017).
Private sector
Private sector can influence education and research institutions directly by exposing their needs related to agriculture (e.g. necessity for new products, improvement of products, skilled labour etc.). Private education and research institutions collaborate to address existing problems and needs. A number of farmer organisations offer their members knowledge and advice, agricultural education and research. Furthermore, they influence policy making.
The Latvian Agricultural Organization Cooperation Council and the Farmers Parliament are the most prominent organisations. The Latvian Agricultural Organization Cooperation Council unifies 58 producers’ organisations including 7 multi-sectoral organisations and 51 sectoral organisations. It represents more than 15 000 producers (LOSP, 2017). The Association collaborates with territorial partners – district farmers’ unions, which unite people from small towns, farmers and other socially active people. The Farmers Parliament unites professional commercial producers, reaching nearly 900 members, who together produce more than half of Latvia’s total agriculture output (Farmers Parliament, 2017). Most of the other farmers’ groups are commodity-based organisations and serve to spread, exchange and create knowledge within specific agricultural sectors (Šūmane et al., 2013).
Co-operatives also deliver new knowledge and innovations. The grain co-operative Latraps is the largest agricultural co-operative. It has 948 members and its main activities are pre-treatment, storage and wholesale of grain and oilseed rape. The milk producers’ co-operative Piena ceļš also acts as input provider (Šūmane et al., 2013; Šūmane and Tisenkopfs, 2008). The umbrella organisation, the Latvian Association of Agricultural Cooperatives, facilitates information exchange among its 50 member-organisations and provides them with training and advice with the help of its own experts (LLKA, 2017).
The MoA and representatives of farmers’ organisations have established the Advisory Council for Agricultural Non-Governmental Organizations, a consultative and co-ordinating body that promotes making and implementing a balanced and sustainable agricultural policy. The Council contributes to regulatory and policy planning documents on issues related to agricultural policy and rural development. It facilitates co-operation and information exchange between food manufacturers and the rural population, farmers associations, national and local governments. It also formulates national opinions in relation to EU draft legislation in agriculture and related sectors (MoA, 2015). Nine leading Latvian agricultural societies are represented in the council: the Farmers Parliament, the Latvian Association of Agricultural Cooperatives, the Association of Agriculture Statutory Companies, the Latvian Federation of Food Processing Companies, the Latvian Association of Organic Agriculture, the Latvian New Farmers’ Club, the Latvian Federation of Farmers, the Farmer Alliance (By-laws of the Advisory Council for Agricultural Non-Governmental Organizations, 2015).
Farmer organisations and food industry also formulate research demand. In the last decade, several industry and inter-body platforms have been established with the aim to promote collaboration between scientists and producers and to stimulate innovations in agriculture and food production. The most prominent platforms in the agro-food sector are the Latvian Federation of Food Companies (LPUF) (established in 2004) and the Latvia Food Technology Platform (LPTP) (established in 2007). These platforms improve communication between research organisations and agricultural producers and try to influence the research agenda.
The LPUF is the only multi-sectoral Latvian food processing non-governmental organisation that brings together food companies and professional associations. It represents producers in state and non-governmental organisations, defends the interests of its members in the development of local and international regulatory acts and provides informational support to its members. The LPUF’s Latvian Food Quality Centre offers seed support for the development of new products and technologies in the food sector that will attract co-financing of EU structural funds up to 80%. The LPUF also organises seminars and training in the agro-food sector.
The LPTP is a joint operation of the LPUF and the MoA and it bases its activities on the European Food Technology Platform “Food for Life” principles. The LPTP brings together the food industry, scientific institutions, legislative institutions, control institutions and universities.
Technology services also contribute to the AIS and have an active role to play. They are eligible for funding from the European Innovation Council (Box 7.1).
Three Latvian SMEs, of which one develops precision farming, are part of the 242 innovative companies receiving funding under the SME instrument of the EIC pilot.
The AgricCloud 2 brings together three businesses from Latvia, Hungary and Germany. The project spans from 2016 to 2018 with a total budget of EUR 1.4 million to pilot test (in six businesses) and market (in five EU countries) the cloud-based precision farming management system AgriCloud.
AgriCloud offers a holistic precision farming by combining processed data collected from agronomic sensors, machinery and service companies with expert knowledge on plant nutrition for improved fertilisers and herbicides use and efficient machinery utilisation and workflow management. The expected yield gains and reduction of chemical use would allow amortisation of the AgriCloud investment within 1 to 2 years.
Source: http://www.agricon-baltic.com.
7.3. Public and private investments in agricultural R&D
Research in Latvia is highly dependent on public funding. Three ministries are directly responsible for the governance of agriculture science in Latvia: the MoES, the MoE and the MoA. Various funding mechanisms are available; the most important are basic research funding, national grants and projects and EU structural funds.
Priorities for agricultural research and development
National research in agriculture is very much aligned with EU research priorities. The MoA mainly funds research topics for which national results are required within the CAP at EU level or by the NDP 2020 at the national level. No common research strategy exists and the private sector is not involved in defining the national agriculture research priorities (Rivža-Zēverte et al, 2015).
Building on the priorities of the EU research and innovation programme Horizon 2020, the Latvian government adopted six priority areas in science in 2013 for the period 2014-17. Two priority areas are relevant to agricultural sciences and forestry; Environment, climate and energy, and Research and sustainable use of local resources (MoES, 2014b). The priorities were adapted to societal and geopolitical changes that have taken place in Europe and nine new priority directions were approved in December 2017 under the title “On Priority Directions in Science 2018-2021”. Of the nine priority directions: research and sustainable use of local natural resources for the development of a knowledge-based bioeconomy is the most relevant to agriculture while strengthening security of energy supply, development of the energy sector, energy efficiency and climate change, nature protection, environment and sustainable transport are also related, and culture of knowledge and innovations for economic sustainability refers to innovations for economic sustainability (MoES, 2018). The knowledge-based bioeconomy is also one of the research priorities of RIS3 which shapes the Latvian capacity for innovation.
Latvia’s Rural Development Programme is also a means to develop the scientific potential for agriculture and forestry, as well as knowledge transfer at all stages of production (Box 6.4). Most agricultural research in Latvia is applied research carried out in close co-operation with practitioners and taking into account farmers’ needs. While it is positive that research results can be applied in practice, fundamental research is needed and should be reinforced (Rivža-Zēverte et al, 2015).
Research funding instruments
The MoE, the MoES and the MoF together with sectoral ministries are responsible for the strategic planning and the supervision of the public research funding streams and horizontal policies. They distribute EU funds through the Central Finance and Contracting Agency (CFCA, 2017). As for national funds, these are mainly distributed directly or through the Study and Research Administration (SRA), the SEDA and the Latvian Council of Science. These institutions are responsible for research administration and expertise (MoES, 2017).
While both state and private institutions carry out research in Latvia, only public institutions are entitled to receive a basic research funding (institutional funding) from the state budget. The basic research funding (institutional funding), distributed by the MoES, aims to provide research institutions operational stability and the ability to raise competitive funding from various sources. National grants and projects, distributed mainly through the MoES and the MoA, are the main public agricultural research funds (Zēverte-Rivža et al., 2015). Project tenders from the state budget include calls for projects from sectorial ministries - in agriculture science they are mostly from the MoA and the Ministry of Environmental Protection and Regional Development (MoEPRD) - and grants from the Latvian Council of Sciences and State Research Programmes.
Since 2015, the 3-pillar funding model is implemented in Latvia (Figure 7.3). Basic research funding is attributed for a period of six years, based on several elements: funds needed for the maintenance of the scientific institution; salaries of the scientific personnel (senior researchers, researchers and scientific assistants); and the scientific development coefficient of the institution (MK, 2013). The scientific development coefficient is computed based on the scientific results of the institution in the previous year, including the number of R&D projects, publications, patents and plant breeds, and PhD and MSc theses completed (MoES, 2016c). Scientific institutions receiving basic research funding must undergo an international assessment of their operations. In 2017, 22 state scientific institutions received basic research funding (institutional funding), EUR 23 million, of which less than 8% went to agricultural-related institutions: the LLU, the AREI and the DI (Table 7.1).
HEIs also receive performance funding in line with their accomplishments and according to unified criteria. The awarded funding may be used by the HEI for their development needs, including supporting students’ innovation projects, research and creative work (Figure 7.3). In 2017, EUR 6.5 million were awarded to 14 HEI and colleges which showed high success in involving students and new scholars in research and creative activities, carried out international research projects and co-operated with entrepreneurs; among them, LLU received EUR 450 530.
Source: MoES.
Scientific institutes can also compete for national grants and projects that are allocated from the state budget mainly through the MoES and MoA (Zēverte-Rivža et al., 2015). Competitive funding is allocated to research projects under State Research Programmes, the Latvian Science Council, the Fundamental and applied research programme, EU research programmes and bilateral co-operation programmes (MoES, 2016c).
In the 2014-17 period, there were 10 new and 4 extended State Research Programmes. The share of agricultural and forestry research in State Research Programmes funding for 2014-17 was 19% of the EUR 21 million total financing (MoES, 2014b). One project, the “Agriculture resources for sustainable, qualitative and healthy food production in Latvia” (AgroBioRes), is relevant to agriculture with a total funding of EUR 2 million (Zēverte-Rivža et al., 2015), and another, the “Forest and earth entrails resources study and sustainable use – new products and technologies” (ResProd), is relevant to forestry and land resources, with funding of EUR 2 million.
In 2015, the Latvian Council of Sciences funded 9 collaborative projects with a total budget of EUR 1.2 million and 65 thematic research projects with EUR 3.2 million. One project was funded in agriculture on technologies of sustainable berry production (EUR 163 000) and five thematic projects related to agriculture and forestry science with an average grant of EUR 61 000 (Latvian Council of Science, 2015). While the topics receiving research grants from the Latvian Council of Science are mostly related to plants, some funds go to renewable energy production from agricultural inputs, animal diseases, and animal feeding (Kokorevičs et al., 2014).
Research in Latvia relies heavily on EU funding. These include structural funds for science infrastructure (ERDF), PhD and MSc study grants (ESF), thematic project funding, etc. These funds are distributed by the MoES through calls for proposals. The CFCA controls the implementation of projects, while funding is managed by the CFCA or the SEDA. The MoE is responsible for the planning of the distribution of EU structural funds targeted to increasing the competitiveness and export capacity of businesses and new product development and innovation. The funding is managed through the LIAA and the CFCA controls its use (Zēverte-Rivža et al., 2015). All enterprises can apply for these types of funding, including those that work in the areas of agriculture and/or food processing, excluding primary agricultural producers.
Other important streams of funding include the EU Research Framework programmes and Horizon 2020. However, the share received by agricultural science is lower than the share of basic research funding (Zēverte-Rivža et al., 2015). In recent years, scientific institutions compete increasingly for funding by the EU Horizon 2020 programme, Interreg and other EU research programmes or outside EU funds, as a result of financial constraints and government incentives.
One problem of the financing system of Latvian research projects is that the proportion of funding for bottom-up research (fundamental and applied research projects) projects of the total public funding is very low, which indicates excessive reliance on EU funds for investments.
Trends in public expenditures on R&D
While Latvian gross domestic expenditure on R&D (GERD) has increased significantly in the past 16 years; R&D expenditures as a share of GDP in Latvia is low (0.44% in 2016) compared to the average share of R&D expenditures in EU countries (1.93%) and OECD countries (2.34%) in 2016 (Figure 7.4). This share is well below the NDP 2020 target of 1.5% of GDP by 2020. The means put forward by the NDP 2020 include the development of innovation, of the research infrastructure, the improved collaboration between higher education, research and the private sectors to facilitate research and innovation transfer into business (NDP 2020).
Analysing Gross domestic expenditure on research and development (GERD), R&D funding has shifted from the state budget to foreign sources; mainly EU structural funds (during the latest five years, foreign funding forms about half of all sources of funding) (Figure 7.5, Panel A).
The cross-section analysis of R&D funding shows that, in Latvia 40–50% of research expenditure is in higher educational establishments (Figure 7.5, Panel B), whereas, the business sector holds a very small share. The likelihood of commercialising innovation increases if it is carried out by business. When an innovation is commercialised, it can increase income and value-added and facilitate growth (Kazāks et al., 2014). This means that the proportion of business investment in R&D from the GDP must be strengthened. Conversely, the participation of the private sector hinders the performance of the strategic plan most significantly when tested against the achievement of the 1.5% GDP target for 2020.
Starting from 2004, when Latvia joined the European Union, EU funding programmes have increased R&D expenditure involving not only government and HEI but business enterprises as well. In 2005, more European financing was available and at the same time national financing for agricultural science increased through the programmes of the MoA and the MoES. However, as from 2006 funding for agriculture research declined and the sharpest decrease in R&D expenditure was in 2009 (by 40% compared to the previous year), which was the first year of financial crisis in Latvia. A gradual increase was observed starting from 2010.
The total Government budget allocation for R&D (GBARD) has increased from EUR 14 million in 2000 to EUR 67 million at its highest point in 2008. In the context of the economic crisis, in 2010 it fell by 43% compared with 2008 and was only EUR 52 million in 2016. The share of agriculture in the GBARD was 21% in 2016. The total GBARD for agriculture shows the same trends as total GBARD – a decrease from 2009 to 2012 and resumed growth since (Figure 7.6).
Notes: Gross domestic expenditure on R&D (GERD) is defined as the total expenditure (current and capital) on R&D carried out by all resident companies, research institutes, university and government laboratories, etc., in a country. It includes R&D funded from abroad, but excludes domestic funds for R&D performed outside the domestic economy.
1. The OECD aggregate is the unweighted average for the 35 countries that were members of the OECD in 2016. It does not include Lithuania.
Source: OECD (2018), Main Science and Technology Indicators (database), http://stats.oecd.org.
Source: OECD (2018), Research and Development Statistics (database), http://stats.oecd.org.
Note: Government budget allocation for R&D (GBARD) is a funder-based approach for reporting R&D, which involves identifying all the budget items that may support R&D activities and measuring or estimating their R&D content.
Source: OECD (2017), Research and Development Statistics (database), https://stats.oecd.org/.
Support to knowledge infrastructure
Between the 1980s and 2004, the research infrastructure in the state scientific institutions and higher educational establishments underwent very little renovation. In the EU funding planning periods for 2004-06 and 2007-13, a total of EUR 127 million was invested in the modernisation of research infrastructures of the state scientific institutions, of which EUR 107 million from EU structural funding (ERDF) (MoES, 2016b). Less than 10% of EU funding was invested in the modernisation of research infrastructures in scientific institutions related to agriculture (Table 7.2).
During the 2004-06 planning period, EUR 36 million of EU structural funds, including EUR 27 million (ERDF), were used for “Support to modernising science infrastructure in the state scientific institutions”. Support was offered for modernising research equipment and infrastructure in the state institutions that perform scientific research in the priority directions in science. The investment aimed to enable the transfer of research results, including technologies, into the industrial sector and to attract human capacity in the Latvian research sector. These investments were targeted to areas where research potential existed and options for collaboration between the research and the business sector were identified, and only a few were relevant to agricultural research infrastructures: material science (8 projects); organic synthesis and biomedicine (10 projects); wood processing technology and forestry science (5 projects); information technologies (6 projects); astronomy (3 projects); environmental sciences, biology and ecology (6 projects) (MoES, 2016b).
In Latvia, during the period of 2007-13, nine Research Centres of National Significance (Valsts nozīmes pētniecības centri, VNPC) were established to ensure collaboration between EU scientific institutions with a total funding of EUR 91 million, including EUR 80 million from ERDF and the remaining co-financing from scientific institutions. Funding was directed, inter alia, to the Research Centre of National Significance for the Use of Agricultural Resources and Food (actual eligible expenses – EUR 8 million), the Research Centre of National Significance for Forest and Water Resources (actual eligible expenses – EUR 10 million) and the Research Centre of National Significance for the Acquisition and Sustainable Use Technologies of Power and Environmental Resources (actual eligible expenses – EUR 12 million) (MoES, 2016b).
In 2014, the “Development of the Institutional Capacity of Scientific Institutions” was decided, which included the consolidation of scientific institutions with a total funding of EUR 11 million. As a result nine agro-food scientific institutions were reorganised and two new scientific institutions, the DI and the AREI, were created as spin-off public entities subsequently attached to the LLU (Table 7.3).
In the 2014-20 period, EU structural funds will support the strengthening of the institutional capacity of scientific institutions and the improvement of their performance and management efficiency. Of the overall envelope of EUR 120 million, the LLU and its institutions would receive EUR 17 million and the BIOR EUR 6 million (MoES, 2016).
Considerable investments were made by the European Union for the improvement of infrastructure in the LLU. In 2010-14, the “Modernisation of the Latvian Agricultural University Study Infrastructure” was carried out with ERAF funding for a total amount of EUR 17 million. The project achieved the reconstruction and renovation of individual buildings and infrastructures and the construction of new buildings. The most modern veterinary hospital in the Baltics was established, where both veterinary practice and practical teaching of students takes place. The project also included the creation of a building for the Faculty of Food Technology and its provision with modern equipment for ensuring efficient research and studies.
Using the EU structural funding sources, the Laboratory complex for the needs of the Soil and Plant Science Department of the Agricultural Faculty of the LLU was modernised, including the reconstruction of the main building, renewal of the greenhouse complex and basement as well as significant investments made in improving the equipment so that the complex could be used as a study and research base for LLU students and scientists. Equipment and tools were acquired for bioanalytic, chemical, molecular genetics, biotechnological and engineering technological studies in the areas of agriculture and food. The goal of the reconstruction was to create a modern material and technical basis for the development of agriculture and food science and raise their competitiveness.
The LLU project “Strengthening the Research, Development Infrastructural and Institutional Capacity of the LLU and Scientific Institutions under its Supervision” will receive EUR 17 million to increase its capacity and concentrate the research resources of the LLU and its research institutions: the Breeding Institutes and the Institute of Agricultural Resources and Economics (IARE). The key activities of the project involve the modernisation of the research infrastructure of all LLU research institutions and the renovation of scientific apparatus and research laboratory equipment. In addition the project funds 20 jobs.
The BIOR will receive EUR 6 million to modernise its equipment and construct a new building for the Fish Resource Research Department. The funds will also be used to develop a strategy for research infrastructure users to create opportunities for the researchers and visiting researchers of the institute to make scientific discoveries and designs and to participate in international projects and consortiums.
By 2021, it is planned to invest over EUR 3.3 million of ERAF funds in the improvement of engineering science and natural science study environments for the acquisition of new study materials, as well as IT and study premises equipment, including repairs in classes, modernisation of the Wi-Fi and renewal of software, as well as extending the range of materials at the LLU Fundamental Library and improving the study environment, and extending research options at the Faculty of Veterinary Medicine.
Trends in private expenditures on R&D
While data on business expenditure on R&D (BERD) is not available for the food and agriculture sectors in Latvia, general trends may be representative of agro-food companies. Economy-wide BERD as a percentage of GDP in the analysed period (2000-16) has fluctuated, and decreased since 2014. Its share in GDP is still much lower than the OECD and EU28 averages in 2016 (Figure 7.7). This can possibly be explained by the lack of financial resources to cover the cost of own-research and the small size of the market outlet. Nevertheless, there are several success stories where unique products have been created that are also exported.
While food and agriculture producers value the creation of new local varieties and food products, the sectors have not invested in innovation. Farmers have embraced policy incentives, including CAP investment subsidies and national credit subsidies, to purchase new machinery and upgrade their farms with new technologies including ICT. They have invested in buildings and increased their productivity and sustainability (Section 2.5 and Table 6.4).
Private R&D funding for agriculture is insufficient and several reasons can be put forward; in a context of mostly small agricultural businesses, the cost of innovation, the risk involved, the lack of market incentives and the absence of collaboration between the business sector and scientific organisations (Žubule and Davidova, 2016).
Notes: Business enterprise expenditure on R&D (BERD) is the measure of intramural R&D expenditures within the business enterprise sector (regardless the sources of R&D funds).
1. The OECD aggregate is the unweighted average for the 35 countries that were members of the OECD in 2016. It does not include Lithuania.
Source: OECD (2018), Main Science and Technology Indicators (database), https://stats.oecd.org/.
Public incentives to private investment in agricultural R&D
The main support programmes for innovation development, including those for agricultural or food processing enterprises include: 1) competence centres programme, also used for the acquisition of research and innovative equipment; 2) technology transfer programme, which includes innovation vouchers, and engagement of highly qualified employees; 3) implementation of new products into production; 4) innovation motivation programme; and 5) support for training of employees (MoE, 2018).
From 2011 to 2013, EUR 53 million of EU structural funds were used to support the creation of six Competence Centres to facilitate collaboration between the research and industrial sectors, undertaking projects to develop new products and technologies and to introduce them in production. As a result, companies created 180 new, innovative products in co-operation with scientists.
The funds are continued and another EUR 64.3 million are planned from 2014 to 2020 to support eight competence centres. One competence centre deals with the introduction of innovations in the agriculture and food sectors – the Food competence centre of Latvia. With the help of the Food competence centre of Latvia, it is possible to receive support for the development of new products and technologies in the food sector, attracting co-financing of EU structural funds up to 80% (total amount of EUR 5.4 million from 2011 to 2018, including EUR 3.2 million of ERDF funding). The initial aim to support at least 11 entrepreneurs from 2016 to 2018 was exceeded and by September 2018 there were 32 research projects and 29 entrepreneurs supported. From 2019 to 2021, the Centre will receive ERAF funding of EUR 4.7 million for the development of new products and technologies, which includes support for cross-sectoral co-operation.
The Cluster Programme receives state and EU support to facilitate collaboration between business and research, and educational and science dissemination organisations, thus facilitating innovation and the creation of high added value products and innovations, as well as growth of export volumes. In Latvia there are now 14 clusters, of which one is related to a sector linked to agriculture (production of food and drinks) – Food products quality cluster. The cluster consists of 53 members – private companies, BIOR and the Food Competence Centre of Latvia (LPUF, 2018). In this EU fund programming period, the main objective of the cluster programme is to promote the export of cluster companies. Until 2020 clusters will receive EUR 6.2 million of ERAF support (total funding of the programme). At present, funding has been allocated to six cross-sectoral clusters and eight sector clusters, including the Food products quality cluster. It is expected that the total export volume of the 14 clusters approved should increase by EUR 300-400 million (Aleksejenko, 2017).
As part of the EU programme “Support for training of employees” the MoE provides support for employee training. In the context of agriculture and food sector innovation, the Latvian Federation of Food Companies organised training for agriculture and food enterprises of all sizes within the project “Training in the food and related industries – skills development” from July 2016 to 31 December 2018. The total funding for the project was EUR 1.4 million, of which EUR 0.9 million was ERDF funding.
The MoE’s LIAA offers various EU funded support programmes to facilitate innovation. These include the creation of regional business incubators for new, viable and competitive companies. Micro, small and medium companies, including in the food processing sector, can obtain funding for business start-ups through incubators. Incubators provide support to launch and develop businesses with co-funding for consultations, training and activities on general business issues, mentor support and grants.
The innovation voucher programme offers micro, small and medium businesses from EUR 5 000 to EUR 25 000 to develop new, or improve existing, products, technologies or services in collaboration with a research institution or university.
Likewise, support by the LIAA is provided for start-up companies that meet several characteristics set in the definition of a start-up, including innovative features. The support is provided through grants for engaging highly qualified employees for the development of new products and technologies (up to EUR 200 000, up to 45%), fixed tax payment per employee (EUR 259 per month to VSAOI) and, in addition, up to 100% company income tax discount, no payment of IIT (for employees).
In addition, the corporate income tax is waived for the acquisition or creation of new production technological equipment, as well as the investment in research and development. Any sector companies (including agricultural sector companies), which have invested in research and development where the expected result has innovative elements or prevention of technological indeterminacy, may benefit from company income tax remission. Despite this measure private sector R&D remains very low.
The Enterprise Europe Network (EEN) offers consultations on international technology transfer and innovation issues. It is the world’s largest support network for small and medium-sized enterprises, including agricultural businesses, with international ambitions. The EEN is active in more than 60 countries worldwide. It brings together 3 000 experts from more than 600 member organisations. Member organisations include: technology poles, innovation support organisations, universities and research institutes, regional development organisations, and chambers of commerce and industry. Individual businesses cannot become EEN members, but they can enjoy the many services offered (e.g. EEN provides links with local innovation stakeholders, information on innovation-related policies, support programmes, innovation audits and strategy advice, technology and innovation brokerage services, advice on access to finance for innovation support to access funding programmes etc.). It is co-financed under the EU’s programme for the competitiveness of SMEs (COSME) and the EU Framework Programme for Research and Innovation Horizon 2020 (Horizon2020) (EEN, 2018).
Altum’s accelerator funds programme includes agricultural sector companies and agricultural service co-operative societies (Box 4.2). Pre-seed investment – up to EUR 50 000 per company –funds the establishment of a company, including the development, study, assessment and confirmation of a product or business activity model. Seed stage investment – up to EUR 250 000 per company – supports projects that have successfully emerged from the acceleration stage and are ready for further business growth funding, including the development of a product or business activity model.
As part of its co-financing loans (mezzanine) programme Altum offers loans to companies (including agricultural companies excluding primary producers) and agricultural service co-operative societies (Box 4.2). The maximum amount of a co-financing loan is up to EUR 5 million, and it cannot exceed 45% of the total project costs (for loans from EUR 2 million to EUR 5 million, the maximum amount cannot exceed 35% of the total project costs). The minimum amount is EUR 50 000 (Altum, 2018).
Role of public procurement and other “pull mechanisms” in research funding
Pull mechanisms incentivise the private sector to work towards a defined goal. Pull mechanisms reward successful innovation ex post, compared with push mechanisms, which fund potential innovations ex ante and do not link funding to specific outcomes. Push mechanisms lower the cost of innovation, they include R&D funding through projects or institutions. Pull mechanisms include innovation prizes, patent buyout, and reward research output tax credits on sales (OECD, 2013).
The Latvian innovation system is based mainly on push mechanisms and few pull instruments are available. The “Export and Innovation Prize” competition, organised by the MoE, rewards Latvian companies for their good results in the production of new and exportable products, or the provision of high quality local products to local markets, or the introduction of innovations and development of industrial design. The international competition “Quality Innovation Prize” helps innovators obtain professional assessment for their innovations and increase innovation recognition. It raises the competitiveness of participants’ projects thanks to the innovation assessment they receive both at the national and international levels, as well as professional assessment of international experts.
In recent years, public procurement has gained popularity worldwide and particularly as a policy instrument in the European Union. It is one of the main mechanisms to strengthen the innovation performance of European businesses (Cepilovs, 2014). The public sector can cover a range of roles on the demand side: acting as a direct buyer and user of innovative products or services; facilitating adoption of innovative solutions through regulation or support of private demand; or through provision of information regarding new technologies and stimulating their adoption. The European Commission noted that Latvia’s public procurement has so far not stimulated innovation (EU, 2016). The use of central purchasing for local authorities and innovation-oriented procurement are low. Public procurement for innovation is largely absent in Latvia (EU, 2016). Also, the Global Competitiveness report 2015–16 states that government procurement of advanced technology products in Latvia takes 100th place in the total evaluation of 144 countries.
The MoE has started introducing innovation public procurement in Latvia. In application of the European Directive on public procurement, Latvia changed its Public Procurement Law in 2017 to increase the impact of public procurement on innovation development (EU, 2014). The new law envisages two new procurement procedures – innovation partnership procedure and competition procedure with negotiations. Innovation partnership procedure can be applied in the cases when it is necessary to create long-term innovation partnerships for the development and further procurement of new, innovative products, services or construction work. In turn, the competition procedure with negotiations could be applied only in those cases when it is impossible to obtain an offer that meets the customer’s needs in open or closed competition.
Green Public Procurement (GPP) definition is developed, which provides wider possibilities for applying the GPP criterion in public procurement. In 2017, the Cabinet of Ministers regulations “Requirements for Green Procurement and their Application Procedure” came into force. These regulations were developed to facilitate green procurement, thus reducing the environmental impact of publicly procured goods, services and construction work during their life cycle, while facilitating the development of environmentally friendly goods and services markets and an increase of local economic competitiveness (MK, 2017b). It means that in future food delivery and food service procurement will be able to use the GPP criterion successfully, acquiring products that meet the National Food Quality Schemes requirements to raise the presence of higher quality local foods in green public procurement (Sections 3.2 and 4.1).
To reduce the attractiveness of a low price as selection criteria, the law sets the economically most advantageous offer criteria as the main offer assessment criteria. The latter is determined by the customer in view of its costs or price, or costs and quality criterion, or price only.
The new law also includes gradual transfer to a fully electronic procurement procedure. This will provide a decrease in the administrative burden on deliverers. From 1 January 2019, the reception of offers and applications will take place only electronically.
Although the impact of these changes will be noticeable only after some time, it is planned that the new regulation will simplify and speed up the process of procurement and will provide increased opportunities for customers as well as partially facilitate minimisation of the administrative burden while facilitating innovation and sustainability.
7.4. Creating knowledge markets
Intellectual property rights, knowledge networks, and knowledge markets are of growing importance in fostering innovation.
Disseminating research results
Scientific activity and innovation are furthered by scientists, scientific institutions, companies and residents through access to the existing results of scientific research, making them public and using them. Thus, it is essential to ensure science transfer between all the engaged parties. The optimum circulation of scientific knowledge, access to it and its delivery is a priority in Latvia (MoES, 2016a).
In Latvia, public accessibility of information is determined by the Information Publicity Law issued in 1998. It defines the cases of limited access to information and of its disclosure. It is considered to mark the beginning of facilitating information exchange between society and the state management institutions and its subjection to the existing bodies, including scientific institutions (Informācijas atklātības likums, 1998).
Availability of information on international research and its results is specifically regulated by the Law on Scientific Activity issued in 2005. According to the law, information on scientific research that is funded from the state or municipal budget is open and the institution responsible for performing the scientific research must ensure general availability of the research results (Zinātniskās darbības likums, 2005).
Latvia encourages open access to science, emphasising the transfer of science between the state funded research and the private sector while observing the intellectual property rights (MoES, 2016a). However a “total open-access science” policy is still under development and there is no regulation that determines which research publications and research data must be offered open access and archived in institutional open-access repositories. The proportion of open access scientific articles and data in Latvia is low and only 17% of scientific articles and data are provided in open-access. The main reason for this is insufficient funding, as publication in open-access resources is a paid service, especially in foreign open-access journals (MoES, 2016a).
Following the European Research Area Guidelines, Latvia aims to provide an appropriate infrastructural and regulatory environment that will facilitate the increase in open-access to scientific articles and data in Latvia. Its implementation is assured by the MoES’s National Scientific Activity Information System (MK, 2017a). The system collects all information about scientific activities performed by scientific institutions and the people engaged in it (available at sciencelatvia.lv) (Zinātniskās darbības likums, 2005). The MoA has user rights in the system, and it supervises the agricultural sector scientific institutions which perform scientific research by providing information on the research findings. Private businesses are also entitled to both interrogate and contribute to the system (MK, 2017a). Since 2009, farmers have free access to current information in the sector and the results of projects on the homepages of the LLKC and the VLT (Valsts lauku tīkls, 2015).
Scientific institutions use various open-access publication options – open-access journals in Latvia and abroad and open-access repositories in Latvia. Currently, Latvia has seven open-access journals, two open-access repositories (LU’s repository of e-resources and the academic repository of the Latvian National library “Academia”) and one partially open-access repository (institutional repository of the Riga Technical University). Since 2009, Latvia has an open-access information point that was initiated through the LU’s participation in the FP7 OpenAIRE project (MoES, 2016a).
There are limited incentives for scientists to publish specifically in open-access resources, because open-access publications and scientific data are not included in the assessment criteria of scientific institutions in Latvia when, for instance, a scientific database funding is allocated and scientific project applications are assessed (MoES, 2016a).
Access to scientific information in the agricultural and other sectors is provided by the Fundamental Library of the LLU, which is the only Latvian library in this sector and which from 1998 is also the depository library of the UN Food and Agriculture Organisation. The LLU Fundamental Library fund embraces topics in food production, agriculture, forestry, fishery, agricultural economy, veterinary medicine, statistics, and other related sectors.
Several scientific institutions maintain gene banks to ensure the protection, preservation and sustainable use of genetic varieties of plants and animals, forests and aqua culture by the Latvian agriculture and food sectors.3
In 2006, the Latvian State Forest Research Institute “Silava” established the Genetic Resource Centre. The Centre co-ordinates activities in the area of preservation and study of Latvian genetic resources, including those for plants, forest trees and, partially, also for agricultural animals and fish. The Genetic Resource Centre is divided in three parts – the Latvian field crop gene bank, the central database and the molecular genetic analysis laboratory. The gene bank stores crop field seeds of Latvia origin – about 2 000 samples of plant genetic resources of Latvian origin from 72 plant varieties, including wild species related to cultivated crops. The central database contains information on plant genetic resources. Passport data of Latvian plant genetic resources for food and agriculture are maintained in the SESTO database (in collaboration with NordGen), and species descriptor data are stored in a local database. The central database maintains contacts with other international databases, for instance the EURISCO and other central crop databases (MoA, 2016a).
In addition to the Latvian State Forest Research Institute “Silava”, other institutions responsible for the preservation of plant genetic resources in Latvia include the AREI, the DI, the LLU and the National Botanic Garden. Due to limited funding, these institutions only maintain plant genetic resource accessions, and there are minimum provisions for their description, assessment and potential utilisation. Molecular passport data is collected for the majority of species maintained in the gene bank, primarily utilising microsatellite (SSR) markers (MoA, 2016a).
The LLU’s Scientific Laboratory of Molecular Biology and Microbiology operates a genetic bank for storing and studying agricultural animal breeds genetic resources biological material samples – altogether over 1 000 blood, DNA and hair samples, as well as sperm doses. The preservation and development of agricultural animal genetic resources in Latvia follows the breeding programmes developed by the agriculture animal breeding associations for each species. Owners of genetic resource animals can obtain annual national support, limited to a maximum of 550 animals of the same species. The number of animals involved in the genetic resource preservation programme is decreasing for the majority of species (MoA, 2016a). The LLU also maintains 60 local bee population colonies, including 5 breeding ancestral colonies, and 100 queen-bees (MoA, 2016a).
Protection of Intellectual Property
Intellectual property rights in Latvia are determined by several laws: a) the Law on Scientific Activity; b) the Patent Law; c) the Design Sample Law; d) the Plant Varieties Protection Law; e) the Law on Industrial Property Institutions and Procedures; f) the Law on Trademarks and Geographic Origins; and g) the Law on Breeding and Animal Production.
Intellectual property rights in relation to Latvian scientists in the sector of agriculture and food science are determined by the Law on Scientific Activity which defines precisely the legal subject when research is funded by the state. According to the law, a scientist has exclusive rights on intellectual property created as a result of the scientist’s scientific activity, unless the contract states otherwise. If a scientist has worked on a contractual basis, the scientist’s rights on the property created as a result of scientific activities are determined by the contract (Zinātniskās darbības likums, 2005).
If as part of state-funded research one or several employees of the state scientific institutions have made inventions or plant varieties, and the employee(s) duties include invention, research, project creation, construction or preparation of technological developments, property rights on the invention or plant variety belong to the employing scientific institution under contractual relations. Property rights of inventors or breeders of plant varieties, who are not employed by a state scientific institution, are determined by the contract between the inventor or breeder and the state scientific institution at which the research was performed (Zinātniskās darbības likums, 2005).
Scientific institutions follow the EC recommendation “On the management of intellectual property in knowledge transfer activities and Code of Practice for universities and other public research organisations”. The majority of scientific institutions develop and perform knowledge transfer; as defined by the institution’s existing or soon to be developed strategy (MoES, 2016a).
Patents
The Patent Office is an independent state institution attached to the Ministry of Justice. The Patent Office implements the legal protection of industrial property, especially invention, trademark, design sample and semi-conductor product topography (MK, 2017). Between 2007 and 2016, 1 480 patents were issued in Latvia based on national applications, and 35 patents were issued based on international applications. Based on an agreement between the Latvian and the European patent organisations, a number of European patents are related to Latvia and are confirmed every year. Between 2007 and 2016 of the 6 784 European patents confirmed, 264 were attributed on the territory of Latvia (Patentu valde, 2017a). In 2016, Latvian applicants submitted 25 applications to European patent institutions and 16 patents were allocated to Latvian applicants (Patentu valde, 2017b).
In 2013, Latvia had 67.17 patent applications per million of inhabitants, well below the average for the EU countries of 112 patents per one million inhabitants (Figure 7.8).
Source: Eurostat (2014), Regional Yearbook 2014: Research and innovation, http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=pat_ep_ntot&lang=en.
Latvia has introduced a system of intellectual property rights. Latvia scores 4.1 points in the WEF’s Intellectual Property Protection Index for 2017 and takes the 68th position among 137 states, with no significant change in the recent past (Figure 7.9). Latvia’s score is close to Brazil among others and well below Switzerland, which shows the highest Intellectual Property Protection Index in the world (WEF, 2017b).
Source: WEF (2017), The Global Competitiveness Report 2017-2018: Full data Edition, http://reports.weforum.org/global-competitiveness-index-2017-2018/.
Plant breeding
Latvia preserves its significant plant breeds by collecting plant genetic resources. The activity is funded from the national support budget to agriculture. In 2016, EUR 39 000 was allocated to the activity of plant gene banks, central databases and molecular passporting laboratories, and EUR 62 thousand to the preservation of cultural plant genetic fund (MoA, 2016a).
Plant varieties protection at the national level is regulated by the Plant Varieties Protection Law. Latvia is a member of the 1961 International Convention for the Protection of New Varieties of Plants (UPOV) and applies the Council Regulation (EC) No 2100/94 of 27 July 1994 on Community plant variety rights. On 31 May 2018, there were 191 varieties of protected plants in the state register on protected varieties of Latvia, among them 103 agriculture crops, 51 fruit trees and berry bushes, 36 decorative plants and 1 vegetable; overall 155 varieties, 81.2%, are bred in Latvia (VAAD, 2018).
The Latvian Catalogue of Plant Varieties lists plant varieties. The seeds of listed varieties may be certified and examined as standard seed, seed of conservation variety or seed of vegetable varieties developed for growing under particular conditions. The regulation on seed growing and marketing is applied to seed growing and marketing of each species. The regulations regarding the recognition of a conservation variety or vegetable variety developed for growing under particular conditions are also applied (Seed and Variety Circulation Law, 2000). On May 2018, there were 211 varieties listed in the Catalogue, 88 varieties among them are bred in Latvia, the remaining varieties originate in 12 other countries (VAAD, 2018).
Latvia’s plant variety protection index is 3.08 points compared to a maximum score of 5.0. It is close to Lithuania’s score and slightly below Estonia and Northern EU countries at 3.38 points (Figure 7.10).
Note: For Latvia and Estonia, 1981-90 data are not available.
Source: Campi, M. and Nuvolari, A. (2013), Intellectual property protection in plan varieties: A new worldwide index (1961-2011), LEM Working Paper Series 2013/09, No. 2013/09, www.econstor.eu/handle/10419/89567.
Animal breeding
Agricultural animal breeding programmes and preservation of genetic resources are funded from the national budget support to agriculture and carried out by associations of animal breeders. These include two dairy cattle breeders’ associations, two pig husbandry organisations, two meat cattle breeders’ organisations, the sheep breeders’ association and two horse breeding organisations (MoA, 2016a). Under the Preservation of Genetic Resources of Agricultural Animals, support was available for the applicants who owned a herd registered according to the regulation on the registration of agricultural animals, their herds and stalls, as well as on animal marking, and who worked with agricultural breeding animals of important local breeds, which are nationally or internationally acknowledged to be endangered species. Financial support was granted to herds represented by some of the following livestock breeds: the Latvian Brown (cattle), the Latvian Blue (cattle), the Latvian White (pigs), the Latvian Dark-headed (sheep), the Latvian horse breeds for riding and the Latvian domestic goat breed.
Food science
Innovations in food science and their property rights’ protection is provided by the LLU and its scientific institutions, which perform research in food science and commercialisation of the results. It is expected that the activities of the Latvian Food Competence Centre together with support offered by the newly established Food Product Cluster will improve business co-operation with research and increase the commercialisation of scientific results (Section 7.3).
The MoA also promotes the Latvian food tradition heritage and requests the introduction of the names of Latvian products in the EU registers of protected products. These comprise products with Protected Designation of Origin (PDO), Protected Geographical Indication (PGI) and Traditional Speciality Guaranteed (TSG). There are currently six registered products (PDO “Latvijas lielie pelēkie zirņi’; PGI “Carnikavas nēģi” and PGI “Rucavas baltais sviests”; TSG “Sklandrausis”; TSG “Jāņu siers” and TSG “Salinātā rudzu rupjmaize”).4
7.5. Co-operation between public and private actors
The Law on Scientific Activity states that scientific institutions have a duty to take the necessary steps to ensure that rights to an invention or plant breed are economically utilised (marketed) in a way which is most profitable for the State (Law on Scientific Activity, 2005).
Agriculture and food production sectors are defined as knowledge-intensive bioeconomy fields; therefore, co-operation between the agents involved and development of innovations are covered under the Latvia’s Bioeconomy Strategy and its Rural Development Programme 2014-20 under the CAP.
Latvia’s Bioeconomy Strategy stresses the importance of collaboration between scientific institutions and entrepreneurs in the bioeconomy sectors (including farmers) and emphasises the importance of research excellence in traditional bioeconomy fields (including agriculture and food production) and effective knowledge-transfer (MoA, 2017a). The establishment of a European-level centre of research excellence in bioeconomy is foreseen as part of the Bioeconomy Strategy. The strategy also puts special emphasis on research interdisciplinarity, additionality and multidisciplinarity (MoA, 2017a).
The Rural Development Programme 2014-20 (RDP) emphasises knowledge-transfer and innovations in agriculture as one priority means to promote innovations, co-operation and the knowledge base in rural areas. The RDP instruments are used to consolidate ties between agriculture, food production, forestry, and research and innovations to improve, among other things, environmental management and environment conditions. The RDP also aims to improve farm economic results by modernising and diversifying farm activities and enhancing their market involvement and orientation (MoA, 2013).
In line with these priorities, the programme provides for three rural development measures: a) Knowledge-transfer and information actions; b) Advisory services, farm management and farm relief services; and c) Co-operation. The funding for these measures amounts to 2.84% of the RDP’s overall expenditure, funded by the EU and State budgets (MoA, 2013). The RDP also provides support for investments in the modernisation of farms and the introduction of technologies, thus indirectly promoting innovations in manufacturing and co-operation between the various parties involved.
Until 2016, co-operation between scientific research institutions and entrepreneurs in agriculture and food was shaped by business-based and entrepreneur-funded research. The Competence Centre for the Food Sector was established in 2016. Despite institutional changes that aim to improve and facilitate business access to research results through improved collaboration; in practice, insufficient co-operation between business and research sectors is still considered as one of the main challenges faced by the Latvian innovation system. This has been emphasised by the EU evaluations, Latvian experts and policy planners as one of the main issues with the development of the Latvian research sector (MoES, 2016a).
In 2014, the scientific community established the Bioeconomy Strategic Research Alliance; a unified innovation system in agricultural and food sectors that promotes excellence in the field of research and technology-transfer and carries out one of the Latvian smart specialisation goals regarding knowledge-intensive bioeconomy (MoES, 2016a).
Considering past experience, the use of EU structural funds to support agricultural innovation, excluding the primary sector, through Competence Centres, technology-transfer, the innovation voucher programme, the cluster programme, and support for the introduction of new products in manufacturing, should be evaluated. Their future use should be targeted based on results (MoES, 2016a).
The adoption of innovations
The Latvian farm sector has been adopting existing innovations more than generating them. The adoption of existing innovations requires a well-functioning knowledge-transmission chain from the sources of innovations to the farm. It also requires educated farm holders and qualified specialists. Latvia’s pool of educated farm holders and qualified specialists must be widened as the relatively low level of educational attainment, and the lack of qualified specialists, hinder the introduction of innovation and the overall competitiveness of the sector. In 2016, 46% of farm managers had agricultural education (higher, vocational or basic), of which 31% had higher or secondary level agricultural education.
Several institutions offer agricultural knowledge-transfer and advice in Latvia. Some of them are also involved in policy-planning and monitoring the development of knowledge-transfer and consultations.
EU RDP funds are used to improve the knowledge base of farmers and there are lifelong learning opportunities in Latvian rural areas. Support to knowledge and information measures aims to raise the education attainment of both employees and managers of rural companies (especially small and medium) with positive outcomes with regards to the competitiveness of agriculture and food businesses and to the adoption of modern and effective implementation of company management system, technologies and equipment (MoA, 2013).
The LLU ensures consultations and knowledge-transfer by providing study and training programmes, organising courses and seminars. The LLU’s Technology-Transfer Division promotes collaboration between scientists and entrepreneurs and provides consultations. The LLU’s Life-Long Learning Centre offers professional development and qualification-upgrade courses for farmers and representatives of the food industry. In parallel to the LLU and its affiliates, several professional education institutions offer agricultural knowledge-transfer.
The LLKC and the VLT are among key institutions that offer farmers knowledge-transfer, on-farm support functions, and co-ordination and consultation.
Latvia’s capacity to connect to R&D networks also contributes to its capacity to adopt innovations generated abroad (Section 7.6).
R&D outcomes
Publications by the Latvian agriculture and food production scientists represent only a small part of Latvia’s scientific publications (Figure 7.11). In 2016, the proportion of cited publications was 0.16% of publications worldwide but with a positive growing tendency, compared to only 0.03% in 2010.
From 2010 to 2014, Latvian joint publications with foreign partners in the SCOPUS data base (total number and divided by regions) was as follows: in total 2 317; Africa 51, Asia and the Pacific Region 317, Europe 2 046, Middle East 169, North America 371, South America 73 (MoES, 2016a).
Source: SCImago (2017), SJR – SCImago Journal & Country Rank, www.scimagojr.com.
7.6. International co-operation in agricultural R&D
One of Latvia’s priorities is international co-operation through various activities to integrate in the European Research Area and develop co-operation both on the European and worldwide level. International co-operation is considered to be an opportunity for Latvian science, business development and competitiveness.
The MoA ensures representation of the agriculture and food sector at the European and global level. It is represented in several international organisations and networks: Food and Agriculture Organization (FAO), World Organisation for Animal Health (OIE), International Union for the Protection of New Varieties of Plants (UPOV), International Seed Testing Association (ISTA), European Federation of Animal Science (EAAP), Organisation for Economic Co-operation and Development (OECD), International Society for Horticultural Science (ISHS), International Plant Genetic Resources Institute (IPGRI), European Regional Focal Point for Animal Genetic Resources (ERFP) (MoA, 2017b). The MoA is also a member of the Standing Committee on Agricultural Research (SCAR); which enhances co-operation, co-ordination, and information exchange on agricultural research in Europe and secures the integration of Latvia’s Bioeconomy Strategy in the overall European Research Area.
While co-ordinating the development of the Bioeconomy Strategy, the MoA held discussions with representatives from the field, discussing their role in the scope of bioeconomy and identifying possible investment in developing the strategy. Through discussions, the Ministry established co-operation with the Latvian office of the Nordic Council of Ministers which has supported several international bioeconomy events (seminars and conferences) in the field of forestry, agriculture and food science, attracting experts from EC institutions and Northern countries for the transfer of good practices (MoA, 2017b).
At the European level, Latvia participates in the European Commission Joint Programming Initiatives (JPI) established in 2008, to reach sufficient critical mass in order to carry out research projects in areas valued by the population, by joining resources of the EU Member States, harmonised implementation and synergy of state research programmes. Within the JPI, Latvia is represented by the MoE, and EU Member States develop a strategic research agenda, based on a joint view as to solving important population issues (MoES, 2016a).
Latvia is not a participant in the Joint Programming Initiative on Agriculture, Food Security and Climate Change, despite analysis carried out by the MoES which shows the competence of scientific institutions (FACCE-JPI)5 (MoES, 2016a). Latvia is an observer in the EU food-related initiative “A Healthy Diet for a Healthy Life”, and is a joint proposal partner in the EU Anti-Microbial Resistance initiative. Latvia fails to get completely involved due to limited funding for R&D, lack of information regarding JPI requirements as well as non-existent or limited research funding at the sectorial ministries (MoES, 2016a).
In 2016, the Cabinet of Ministers approved Latvia’s participation in eight priorities of the European Research Area (ERA) and attributed the necessary funding for the participation. Involvement in the ESFRI research infrastructures will secure international co-operation of scientific institutions and integration in the European Research Area (ERA); furthermore, it will also enhance access to European-level research infrastructures, applying for support granted by various EU programmes, including within the ESFRI. Latvia can participate in the ERA activities with Latvia-based scientific infrastructure sites which ensure effective implementation of scientific results in production by developing high technologies and securing the operation and development of unique research infrastructure sites (MoES, 2016a). The selected priority areas cover most RIS3 areas in Latvia; including the knowledge-intensive bioeconomy (MoES, 2016a).
The State Research Programme for 2014-2017 encouraged scientific development across all sectors, including scientific human resources. The State Research Programme “Agricultural resources for sustainable production of qualitative and healthy food in Latvia” conducts internationally competitive studies in agriculture and food science.
Latvia’s RDP supports co-operation and participation in operational groups of the European Innovation Partnership for Agricultural Productivity and Sustainability (EIP-AGRI) (Box 6.3). The EIP-AGRI offers a framework to connect local multi-actor groups and strengthen links between research, innovations and practice via thematic networks on global challenges (SCAR, 2016). Stakeholders have shown great interest and since its start in 2016 project applications have exceeded available public funds.
International co-operation in agricultural research is carried out by Latvian scientific institutes through joint publications, projects and conferences. The LLU has an active role in the Nordic Association of Agricultural Scientists (NJF) as well as in the European Society for Agronomy (ESA), which is a scientific organisation. Furthermore, the LLU academic staff takes an active part in other international scientific associations: European Grassland Federation (EGF), International Society for Horticultural Science (ISHS), European Association of Agricultural Economists (EAAE), International Scientific Association ECOLOGICA, Nordic-Baltic Resistance Action Committee, KBBE-net – Knowledge Based Bioeconomy, International Humic Substances Society, European Weed Research Society (EWRS), International Soil Tillage Research Organization (ISTRO), British Society for Plant Pathology (BSPP), European Confederation of Soil Science Societies (ECSSS), International Union of Soil Sciences (IUSS). For more than ten years now the Institute of Horticulture has been a member of the European Fruit Research Institutes Network, engaging in fruit science and international sectorial co-operation and developing EU projects.
In Europe, there is the European Food Science Network and the European Federation of Food Science (EFFoST), which unites European food study and research universities/institutes. IFA (ISEKI Food Association) must also be mentioned; it is an independent non-profit organisation, established in 2005 by representatives of universities, scientific institutions, companies and associations with ties with the field of food; the organisation now covers the world. Several co-operation projects have been carried out with the aforementioned institutions at some point in time, including annual Baltic Conference on Food Science (FoodBalt) (MoES, 2015a).
7.7. Summary
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Latvia’s agricultural innovation system is shaped by EU policies and funding, including the Europe 2020 Strategy, the CAP and the EIF.
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Innovation enabled economic growth is at the centre of government medium and long-term plans.
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The ZTAI sets general innovation policy objectives and investment trajectory with regards to innovation in the bioeconomy. It defines action lines necessary to upgrade Latvian science, technology and innovation to a competitive level. It is supported by the Smart Specialisation Strategy and its implementation monitored.
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In a context where little private expenditure is invested in agro-food R&D numerous policy instruments and available public funds are all the more significant for agricultural innovation. These may suffer from a lack of co-ordination, of monitoring and of evaluation.
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The LLU and its scientific institutions carry out most agricultural-related research in Latvia. Their research infrastructure was assessed and modernised recently.
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Latvia has been adapting existing innovations to its own needs more than developing them.
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The adoption of existing innovations requires a well-functioning knowledge-transmission chain from the sources of innovations to the farm. It also requires educated farm holders and qualified specialists.
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Knowledge transfer activities in agriculture and food production, supported by EU funding, have become more widely available and should be further strengthened to facilitate better access to knowledge of the farming workforce. These activities should be continuously adapted to farmers’ needs, monitored and evaluated. Higher levels of participation should contribute to wider innovation take-up.
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Implementation of new technologies and practices and foreign experience are an important part of innovation. However little information is available on farmer participation in such activities, they are not monitored or measured. Little is known on factors that drive the adoption of innovations more generally. Data gaps make it difficult to monitor progress and to adapt measures to needs.
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Co-operation between research and industry is increasing and must be strengthened in particular on joint projects directed towards marketing of research results.
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Latvia’s capacity to connect to R&D networks strengthens its capacity to adopt innovations generated abroad. While Latvia is well connected to international organisations, lack of funding hampers the participation of research institutions in EU initiatives and in collaborative efforts. In turn this is an obstacle to the transmission and implementation of innovations generated elsewhere.
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Notes
← 1. Europe 2020 A strategy for smart, sustainable and inclusive growth, https://eur-lex.europa.eu/legal-content/en/TXT/?uri=CELEX:52010DC2020.
← 3. Information on genetic resources for plants in Latvia is available online at www.genres.lv.
← 4. For more information on EU quality schemes: https://ec.europa.eu/agriculture/quality/schemes_en.