Thirteen years ago, Estonian investors signed a contract with Ukraine which agreed that Estonia would invest in a wine business, Magarach, the Ukrainian state grape and wine institute to start producing wines in Ukraine. Magarach Wine Institute near Yalta was founded in 1828, but by 1999 was not making enough money to pay its employees. Overall, Estonia invested around 400,000 US dollars into the business, although the previously agreed amount was only $100,000.

Despite turning a healthy profit since the investors became involve, the contract has been disregarded by Ukraine, and Ukraine is in fact planning to keep any profits the company has earned. However, the original contract actually stated that Estonian investors would have the right to claim back a massive 49% of the profits made. The Estonian investors were Aleksandr Dulushkov, Peter Kludma and Igor Lavrinjov.

In a meeting of shareholders in January 2011, it was decided that the Estonians had the right to receive this 49% of the profit and it was claimed it would be paid out in ten days time – this never went ahead. Ukraine changed its mind, and the money remained in their side of the business. The issue has been since taken to court, where two of the courts were in favour of the Estonian investors, while the third sent the case back to the first court. It is now feared that, as the courts are influenced by the state, the money may never be back on Estonian ground.

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airBaltic has reported that during the first four months of 2012 their airline transported 841,146 passengers,  with an overall 3 percent improvement of load factor of 70% compared with the first four months of 2011. Load factor represents the number of passengers as a proportion of the number of seats available. 90.4% of airBaltic flights in April 2012 departed on time or with a delay of not more than fifteen minutes. From the airports base in Riga, Latvia, airBaltic provides direct flights to 60 different destinations and via North Hub Riga connecting flights spanning Europe, Scandinavia, Russia, CIS and the Middle East.

Chief Executive Officer of airBaltic, Martin Gaus stated  “airBaltic has an excellent team  in operations, who achieved outstanding efficiency and made airBaltic the most punctual regional airline in continental Europe in 2011. We are delighted to welcome Martin Sedlacky as a new Chief Operations Officer and a Member of the executive Board. I am confident that he will be a tremendous asset to airBaltic’s operations and continue to contribute to business restructuring programme airBaltic ReShape.”

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In their report Oxford Economics acknowledged and thanked the IATA whom had been instrumental in providing key information and statistics regarding the aviation industry. Through their detailed research with data relating to the 2010 calendar year, Oxford Economics summarised that aviation accounts for 2.0 percent of Latvia’s GDP and provides 18,600 jobs which represents 2.0 percent of the workforce in Latvia.

Latvia is already a demographically favourable location for cargo transportation logistics provided by Riga Port and supported by Latvian aviation, but 30 percent of tourism is catered for by aviation, tourism is also a growing and recognised contributor to the Latvian economy. Last year in 2011 the total count of air passengers arriving and departing from Latvia was 5.1 million, up 10 percent from 2010 figures.

IATA Vice President Europe Rafael Schvartzman said”A productive and efficient aviation industry plays a pivotal role in driving development of today’s global economy through critical connections for both passengers and air freight. Latvia has a medium high measure of connectivity by air relative to its economic size. It could therefore increase its economic growth and Foreign Direct Investment by improving its air connectivity with positive economic measures towards aviation”.

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Last year, subsidies have been reported to be drying up in Europe, because wind and solar subsidies are too expensive to be viable, this has lead to some EU countries looking towards nuclear power as a less expensive alternative. Although, conversely, some green energy projects have proven to have a capital return of over 30%.  A recent report in  stated that Estonia’s government intends to reverse the pledge by economic Minister Juhan Parts to reduce support by keeping subsidies for renewable energy producers to meet current targets.

The subsidy system introduced in 2007 is now to be analysed by the Economy Ministry, to assure that they are reaching the optimum level of support. It is hoped that if this support arrangement is continued, Estonia would be able to reach its targets of raising the share of renewable energy of 23% in 2015, and 25% in 2020. This is rising from 2009 levels of 19.5%. Estonian wind parks are currently returning on investment of 16 % to 25%, biomass-fired co-generation plants this was 20% to 28%, and 20% to 41% in five hydro plants.

Although the ministry is not publicising the fee that Sorainen lawyers will be charging for this case, it is understood that their regular rates generally start from 150 Euros an hour.

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Minister Ronis has been promoting the essential qualities provided by Port of Riga. Since 2001 the Northern Distribution Network (NDN), dubbed the new silk road, has utilised the strategic position and unarguably rising efficiency of Port of Riga as an important link in the success of the new supply route from the Baltic and Black Seas through to Central Asian countries and to Afghanistan. In the last three months alone approximately 9.5 million tons of cargo have passed through the Free Port of Riga.

During his visit to the U.S. Minister Ronis met with Transport Secretary Ray LaHood, the Pentagon logistics specialists, Defence Logistics Agency and participated in a conference to discuss NDN future prospects with Latvian and Russian embassies in the U.S., American Transport Department, high ranking officials and international logistics company representatives in attendance. Several U.S. companies met with the Minister Ronis to discus using Latvia as a distribution centre for their supplies to Russia, the CIS countries and Central Asia.

In a meeting with Air Force General William M. Fraser III at Scott Air Force base the General expressed to Minister Ronis the importance placed upon Latvia as a partner to America and the coalition forces in the movement of cargo transported through Port of Riga to safely reach forces stationed in Afghanistan.

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Morgan Stanley, in a recent report, stated that Dixons could no longer afford its large UK stores where huge rental prices conflicted with sustainable profit growth. In order to survive Morgan Stanley considered that Dixons would be better off closing their UK operations to concentrate more heavily on its Scandinavian businesses. It is argued that Estonian’s may not immediately have the buying power to merit the move for Dixons to the Baltics, but the taste and desire for home electronics is patently there otherwise there would not be so many electronics stores already peppering Estonian shopping districts.

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What do firms expanding to the Eastern Europe need to know before starting marketing in local social media?

It was recently announced that IKEA plans to conquer further the Eastern European market by entering Lithuania, and later opening its stores also in Latvian and Estonia. It is not the first Northern brand which is interested in these markets; H&M is also continuously exploring the opportunities to open its first store in one of the Baltic countries. Costa Coffee, the largest coffee-house chain in the United Kingdom and 2^nd largest in the world, has expanded to Poland in 2006, and to Czech Republic in 2008, and has recently opened its first cafes in the Latvian capital Riga. For the companies it means not only new markets and consumers, but also extensive marketing efforts coped with significant cultural differences. Even such globalized and international marketing field like social media needs a different approach when advertising in Eastern Europe, particularly Baltic countries and European part of Russia.

For example, what should a firm do in the social media in order to attract followers from the Baltics? Estonia has very high Internet-penetration and 75% of population is using the Internet. People there love new gadgets and technologies, and will follow you with great pleasure if you offer them sweeteners of such kind. Latvians, for instance, use their local social network Draugiem.lv, which is far more popular than Facebook, and they are also the most active Twitter-users out of all the three Baltic countries. Lithuanians and Estonians prefer Facebook, it is the 6^th and the 3^rd most visited page in these countries. Google is the most preferred search engine in the Baltics, and Youtube is the third most-visited web page. However, such social media web pages like Foursquare or TripAdvisor are far less popular there than in the Western countries. And everyone in the Baltics is reading or at least browsing from time to time the local news portal Delfi.

As for Russia, everything is even more different there: about 46% of population use Internet, and 25% of them are situated in Moscow or St. Petersburg. The most popular search engine is Yandex.ru, and the most popular social network is local Vkontakte.ru with Facebook being behind it. Blogging is of immense popularity in Russia, with Livejournal.com being the most popular blogging platform.

That is why international social media management is important. It helps to recognize the important distinctions between the social networks of different countries, and to adapt the best practices from other campaigns to the local conditions. As there are a lot of Western firms looking in the direction of the Baltics and other Eastern European countries, this is an important point for their consideration. That is why Charles Cormack established Cormack Consultancy which specializes on helping Western firms to market themselves in the Eastern social media.

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Bank Parex to Reverta. Branding one item to another is a key step in many situations for example especially in Banks where recently the re-branding of the Bank Parex to Reverta. The coming of Reverta is believed to cost in the order of over 20,000 Euros.

“Parex is associated with words like crash, crisis and bad bank”, said D. Pavluts continuing with, “The initiative means that the ailing bank has been re-branded for the second time since the initial bailout”, Mr D. Pavluts is the Latvian Economy Minister.

Moves like this can only encourage the public more as it does show much is being done by the economists to recover the recent years of downturn.

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The event is being held by the Latvian Chamber of Commerce and Industry, the Nordic Council of Ministers Office in Latvia, the Danish Cultural Institute in Latvia, the Latvian British Chamber of Commerce in the UK and the International Exhibition Company BT 1. Chief Executive Officer of the Latvian British Chamber of Commerce in the UK and one of the initiators of the forum Mārcis Liors Skadmanis explained that “This will be a significant event for the Baltic and Nordic fashion and textile industry in Latvia, a gathering of great minds, which drive the fashion industry within our region and beyond. I am confident that this forum will open up new doors and opportunities, discussing ideas to build a sustainable and profitable fashion business.”

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