Latvia is a small EU member state that joined the euro area in January 2014 and became a member of the OECD in July 2016. Four cornerstones of the economy are agriculture, chemicals, logistics and woodworking, with machinery production and green technologies as other prominent sectors. The economy is projected to soon recover from a sharp downturn in 2015 and early 2016. The main strategic frameworks in which the country operates are the Guidelines for National Industrial Policy 2014-20, the Guidelines for Science, Technology Development and Innovation (2014-20) and in particular the Smart Specialisation Strategy (RIS3, 2014-20) developed in the context of the European Regional Development Fund (ERDF). These documents emphasise Latvia’s priorities and serve as an overarching roadmap to transform the economy towards higher added value, productivity and more efficient use of resources. At the core of these strategies lie the following policy objectives: i) restructuring of production and export in traditional fields of the economy; ii) support of future areas of growth; and iii) concentration on fields with horizontal impact on the transformation of the economy. Although EU funds are, according to the EC, the main source of RDI funding, Latvia currently suffers from the expiry of several EU funding lines as well as from the sharp decline of economic relations with Russia.