Executive summary

In the past 25 years, Latvia has transitioned from central planning to a market economy. It joined the European Union in 2004 and the euro area in 2014. Latvia has been a member of the OECD since 2016. Today, as a small, dynamic and open economy, Latvia deploys a broad range of reform initiatives that have driven progress, although generally from low levels, in many of the areas that would nurture future innovation‑based economic‑growth. However, progress has been slower in agriculture and more needs to be done to equip this sector with a well-functioning innovation system, and a policy environment facilitating productivity and sustainability improvements.