High tech darbs web

Transcription

High tech darbs web

High
Technology
in Latvia
2007
Latvijas Investîciju un attîstîbas a©entüra
Investment and Development Agency of Latvia
LIAA
High Technology in
Latvia
2007
High-tech potential
goes hand in hand
with technological
competitiveness
Jurijs Strods,
Minister for Economics
In today’s global economy, the pressure for change is greater
and the rate of change faster than ever before. Every
commercial enterprise now competes globally irrespective of
whether it provides goods or services on a local, regional or
worldwide level. Conversely, the global economy has
actually reinforced the importance of success at the local
level as a key to overall progress. In different parts of the
world, competition is more and more clearly based on
business- and labour-skill factors.
These rapid changes in globalisation, the concentration of
knowledge and manufacturing structures, together with
the shift of competition from an inter-country to a city basis,
has increased entrepreneurs’ needs for talented people
and advanced technological environments. It is no longer
unusual for even entrepreneurs from small countries to
readily move production to countries with larger markets
and lower cost bases.
Rapid economic growth, the equalisation of energy and raw
material prices, and other external factors have accelerated
the necessity for local enterprises to raise their productivity
levels and technological competitiveness, gain access to new
markets and increase their own added value.
Today, the progress of technologies can no longer be
considered just in the context of individual enterprises.
Restructuring of the Latvian economy to increase the
proportion of high technology enterprises in all sectors is
being planned and implemented at the national level, thus
fostering the development of a knowledge-based economy.
Latvia has already become an attractive platform for a
number of high-technology companies that have sited
operations here. We are proud of that and continue to focus
our work on improving the business environment, fostering
technology transfer, and motivating local companies to
modernise their production and facilities.
At the same time, I would like reinforce Latvia’s position as a
supplier of technology, combining as it does long-standing
research traditions and world-renowned scientists in several
fields, a competitive higher education system and a strong
industry sector. Successful cooperation between the involved
parties has great potential to promote the commercialisation
of knowledge and turn ideas into innovative, high value –
added products and services.
I have every confidence that this catalogue will be a useful
guide for international companies considering doing
business in Latvia or seeking new, promising business
partners. At the same time, I trust it will become a driver and
source of good practice for other Latvian companies, not
only to gain new ideas, but to promote understanding of
the role of technology in developing enterprises themselves,
as well as competitiveness.
The Ministry of Economics of the Republic of Latvia has in
recent years implemented numerous measures to promote
the transfer of knowledge and technology and to strengthen
the links between the education, science and entrepreneurship sectors. In other words, to facilitate the development
of a national economy that is based on a competitive,
knowledge-driven model.
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Latvia – a new
technological frontier
of opportunity!
Andris Ozols,
Director,
Although it is only sixteen years since the restoration of
Latvia’s independence, many dramatic changes have
occurred – the transfer to a market economy, the development of industry and the drive towards a knowledgebased economy. This progress and achievement have
been internationally acknowledged, with Latvia now a
fully-fledged member of NATO and the European Union.
Over the last five years, Latvia has had the fastest growing
economy in the whole of Europe and annual GDP growth
has exceeded 10% for three successive years. This dynamism
comes from taking advantage of a number of key factors –
Latvia’s strategic geographic location, the expertise of its
highly educated workforce, fully committed government
support and particular advances in technology.
During the Soviet era, Latvia became a major research
hub, with major R&D centres being established in a variety
of technological disciplines. Materials, components and
equipment were developed for advanced projects such as
the Soviet space programme and several military sectors.
Education curricula favoured the needs of science and technological industries.
Local universities and research institutes are highly regarded
for their advanced courses in science, technology and
engineering and have long and proud traditions. Research
and development is keeping pace with the latest accomplishments and global links have been well and truly
re-established; the European Commission has formally
recognised five Centres of Research Excellence in Latvia.
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Research and knowledge-based innovation underpin the
multi-disciplinary expertise that forms the cornerstone of
our country’s economic competitiveness and quality of life.
By developing an environment conducive to innovation and
streamlining the transfer, absorption and diffusion of best
practices and new technological advances, we are increasing
the value added for our customers in the future. Value will
grow ever more rapidly as Latvian companies evolve the
confidence and ambition to reap the full benefits to be
gained from technological know-how and good international partners. One advantage remains home-grown
though, our highly competent personnel, pioneers in their
own fields, bold innovators and avaricious seekers of new
solutions.
We are proud to introduce to you Latvia’s trailblazers in
technological expertise: in pharmacy, biotechnology and
biomedicine, information technologies, electronics, energy,
food technology, chemistry and the wood-processing
industries.
The Investment and Development Agency of Latvia is
happy to be your first point of contact for any and all
business activities in Latvia – we look forward to helping
you with your enquiry and telling you more about the opportunities on offer.
Table of contents
Innovation in Latvia
Pharmacy, Biotechnology and Biomedicine
Grindeks
Olainfarm
Silvanols
Fitosan
MedPro Inc
New Materials and Processes
Plasma & Ceramic Technologies
Plasmalat
Sidrabe
Information Technologies
SmartImage Solutions
Tilde
Electronics
Arcus Elektronika
Autonams
Biosan
Integris
Real Sound Lab
SAF Tehnika
VEF Radiotehnika RRR
Technology services
UNICONE (Junikon)
Biotehniskais centrs
Peruza
Food Technologies
Iecavnieks
Neo
Pure Food
Satori Alfa
Chemistry
Dzintars
Ritols
Bapeks
Valmieras stikla ß˚iedra
Wood-processing
Latvijas Finieris
Laiko
Bolderåja
Technology profile of Latvia
A small country playing its part
in meeting global prosperity challenges
Technology competence centres the key
to open innovation
Diverse hi-tech companies
Meeting global R&D challenges
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Innovation in Latvia
Surprise; verb, definition –
to do something unexpected or unusual. The intention
of this publication is to surprise you, because the last
place you would expect to find successful innovative,
high-technology businesses is Latvia. We will demonstrate that you will, though, and explain how a small
country on the north-eastern edge of the European
Union has come so far, so quickly.
To understand this apparent phenomenon, we need
to put the feats of Latvia's innovation achievers into
some sort of perspective. In Latvia's case, history and
geography are intimately linked. Latvia's location
helped it, and particularly capital city Riga, become
a trade-route crossroads, the intersection of major
north-south and east-west routes, part of the
important Hanseatic network. Add to that the northernmost ice-free ports in the Baltic Sea and you
have a stretch of territory desirable to many colonial
powers. Hence Latvia's colourful history, not the least
of which was the outcome of the Second World War,
when Latvia became part of the Soviet Union.
Since independence in 1991, Latvia's progress has
been astounding with both EU and NATO membership
achieved by 2004. While the Soviet era definitely held
back Latvia's progress, it was responsible for some of
the country’s hidden technological gems that you will
read about here. For whatever reason, Latvia became a
significant part of the Soviet military-industrial complex
and many top-secret research institutes and projects
were located here. As a result, Latvia possesses a
highly educated population and some very specialised
technical know-how.
In the sense described, Latvia is unusual – what are not
unusual are the fundamentals which the companies
who appear in this publication share with their peers in
other countries around the world. They are ideas, a
vision of where to go with them, and the persistence
and determination to keep going with them. We hope
you enjoy meeting these enterprising Latvians and will
be interested enough to make contact or even visit
them – there are plenty more surprises where these
came from!
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The country's long experience and traditions,
the availability of highly qualified specialists,
cost efficiency, high competence in R&D and
a strong manufacturing base are the factors
that form an excellent foundation for business and innovative activities in Latvia's burgeoning bio/pharma sector.
Latvia possesses an extensive R&D base with
good co-operation between industry and the
scientific and academic sectors covering a
diverse range of research spheres: microbiological synthesis, virology, the synthesis of
physiologically-active substances, bioorganic
chemistry,
molecular
biology,
genetics,
biotechnology, biomechanics, magneto-biology and others.
Latvia was the principal location for these
sectors in the former Soviet Union, with 25%
of all new Soviet drug technology designed
here. Thus, one in every four medical preparations manufactured in the former USSR and
intended for the USSR market was actually
made in Latvia.
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Grindeks
Pharmaceuticals
In the globalised economy we now live in, pharmaceutical companies are among the biggest players, and
continue to grow larger with continuing acquisitions
and mergers. There are some compelling reasons for
this: the amount of research, testing, development and
registration required for any new active compound or
product. The complete development cycle from the
synthesis of a compound (which may come from as
many as 10 000 variations initially) to the appearance
of the finished product on pharmacy shelves is from
12-15 years, by which time there will only be five years
left on the original patent, enabling generic-producing
competitors to copy it.
You have to do everything
the big players do,
but with much fewer
resources
A microcosm of Latvia itself
This makes it all the more surprising to find Latvian
companies holding their own in this market. In a sense,
Grindeks, as a small (by world standards) player, is a microcosm of Latvia as a country. If you want to compete in
the big leagues, you have to do everything the big players do, but with much fewer resources. This is a huge
task in this sector, with all the quality, safety, legislative
and environmental requirements additional to the R&D
tasks listed above. So how has Grindeks, one of Latvia's
largest publicly listed companies, managed this?
Latvia’s most
successful export
product
Naturally, there is a successful product underpinning Grindeks development, the company’s
most important brand –
Mildronate® is a very
effective cardiovascular
drug, originally developed at Latvia's Institute of Organic Synthesis, a body that Grindeks maintains a close relationship with. Mildronate® enjoys huge sales in Latvia,
Russia, the Ukraine and several CIS countries, and
accounts for nearly 70% of the company's turnover.
For the last four years, Mildronate® has been named
Latvia’s most successful export product. But Grindeks is
well aware that the good times cannot last, and has a
whole raft of products at different stages of development, as Business Development Director, Kintija Veisa
is only too happy to demonstrate by showing her innumerable fifteen-year planning schedules. It is working
on new forms of and improved delivery for Mildronate®, and already has another Grindeks-branded
product - Ftorafur®, an anti-cancer drug, on the market
and showing strong sales, including in Japan.
Looking ahead
It continues to invest in new facilities, with a major
research and development centre in the pipeline, is taking advantage of EU funding availability for research,
production development and training, and has more
than 100 final dosage forms of other products ranging
from heart and cardiovascular medications, to anti-cancer agents, CNS drugs to analgesic, cough and flu
medications. Grindeks also produces active pharmaceutical ingredients, which the company uses to manufacture its own ready-made medications and sells to
pharmaceutical companies all over the world. Exports
are already sent to more than 40 different countries,
and Grindeks has four subsidiary companies in Latvia,
Estonia and Russia as well as representative offices in
seven countries. That is a serious achievement.
www.grindeks.lv
e-mail: [email protected]
[email protected]
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Olainfarm
Olainfarm was accorded
Good Manufacturing Practice status
for its new tabletting
and capsuling facility,
completed in 2004
Latvia itself. Olainfarm inherited the industrial synthesis
of several active pharmaceutical ingredients and the
manufacture of several products. It has managed to keep all
those products going with much improvement along the
way. Current major branded products include Fenkarol®,
Remantadin, Furamag®; Neiromidin®, and Etacizin®.
Meeting international standards
The company has invested major sums in upgrading its
facilities and systems, achieving both ISO 1400 and 9001
certification and was accorded Good Manufacturing
Practice status for its new tabletting and capsuling facility,
completed in 2004.
Pharmaceuticals on a major scale
In some ways, what was once the sleepy village of Olaine,
barely 20 km south of Riga, might be considered an example
of insensitive 1960s Soviet planning. In this day and age,
most people would call it green-field development.
Whatever one's opinion about Olaine's status, there is no
question that it is the home of a modern and successful
pharmaceutical enterprise - a testament to the vision and
determination of Olainfarm's principals. It would have been
much easier to "sell off the farm", to strip the assets for a
few people's short-term gain. Rather, we see the result of
conviction, of loyalty to one's colleagues, the town and to
Research
for the long term
Olainfarm has long-term
plans to develop additional
products through its own
research and its relationship
with the Latvian Institute of
Organic Synthesis and other
scientific institutes. The
company also continues to
synthesise active ingredients and intermediates,
both for its own use and
for other pharmaceutical
industry customers, in large
quantities for production or
smaller amounts for research purposes; it can also
offer assistance with the
syntheses of new compounds. Importantly, it
maintains a relationship
with the local community,
where the great majority of the 900 employees live, and, as
Olaine's largest enterprise, operating on a self-sufficient site
with even its own water supply, provides services like wastewater treatment to neighbouring companies.
www.olainfarm.lv
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Silvanols
While other Europeans are
rediscovering herbal teas,
many Latvians still collect
their own
Applying science
Against this background, it is not surprising to find a company like Silvanols producing a range of remedies based on
active natural ingredients and to see their offices decorated
with real examples and delightful prints of the sources of
their ingredients. The surprise lies in the applied science
which has gone into building the company and its products,
and into obtaining the Good Manufacturing Practice certificate also displayed on the wall of the company's own purpose-designed premises, not
far from the centre of Riga.
Natural remedies in innovative forms
Every country in the world has a tradition of local remedies
taking advantage of the flora around them. Unfortunately,
technological progress and the discovery and synthesis of
new drugs has often meant that these remedies are lost in
history. In this sense though, Latvia is special, as it has
always had strong rural traditions, in both agriculture and
forestry, and its inhabitants continue to maintain a closer
relationship with nature than their peers in more industrialised countries. While other Europeans are rediscovering
herbal teas, many Latvians still collect their own linden blossoms, mint leaves, cranberries and other flora to last them
through the long winters.
And all this has been achieved
in the 12 years since the company was founded by research
chemist Dr Ieva Leimane, when
all she had was a few sheets of
paper outlining the company's
future - a vision and her own
optimism. Dr Leimane also had
her own knowledge, because,
as a researcher at Latvia's Wood
Research Institute, she had
completed her dissertation on
cellulose electrolyte complexes.
This in turn provided the basis
for innovative liquid gel carriers
for some of the water-soluble
ingredients extracted from
plants. Dr Leimane continues
her research interests, but now they are more focussed on new
ingredients and ways of extracting them, and Latvia offers many
sources, from raspberries to herbs and wild grasses.
Leading the way
Silvanols is by no means the only company in Latvia working
in this sector, but they are way ahead of the field, with their
GMP certification and the fact that several of their products
have gone through registration, no mean feat in a regulatory environment where even EU legislation is still evolving.
Thus, Silvanols is poised to expand by exporting into neighbouring markets.
www.silvanols.lv
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Fitosan
da, more known as a popular
tourist destination, hosts
Fitosan. The firm is conveniently based near the Sigra Institute
which carries out research into
veterinary medicine, feed technology and animal nutrition
and is a part of Latvia's Agricultural University. Fitosan enjoys
a close relationship with the
researchers and, alongside the
company’s own original ideas,
realises many mutual projects
to promote the development
of natural-product-based veterinary remedies.
Going the natural route
Originally founded to continue the production of Soviet-era veterinary pharmaceuticals, Fitosan has now settled into a promising niche the development and manufacture of veterinary
feeds and remedies based on natural ingredients. Although
some people remain sceptical about the move, or return to
green, organic agricultural methods, an example from Fitosan's
product range puts forward a strong argument in favour: the
occurrence of certain udder infections in dairy cattle which
precludes the use of their milk. Those infections can be treated
with antibiotics or with a natural product. There is no argument that antibiotics produce a faster cure, but the now-healthy
cattle must still be kept in quarantine to prevent traces of the
antibiotic reaching the milk. Fitosan's natural remedy acts more
slowly, but the cattle can actually be returned to production
more quickly that would appeal to most dairy farmers.
The need for healthy
animals is universal
Natural veterinary feeds and remedies
You need some background information to understand why
an agricultural products company like Fitosan has been
founded in Latvia and why the company has high hopes for
the future. Despite Latvia’s northerly latitude, its coastal position ensures a more temperate climate than might otherwise
be expected. Animal husbandry has always played a significant part in local agricultural practices. Proof of this lies in
what will be a revelation to many that Latvia was the main
exporter of bacon and butter to Great Britain between the
two world wars, during the first independence period.
Research links
The Soviet era changed many agricultural practices. But the
need for healthy animals is universal, which explains why Sigul-
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MedPro Inc
Pharmaceuticals and packaging
From the outside, a typical, five-storey, central-city, ornamental Jugendstil (Art Nouveau) apartment building just like
many others frequently photographed by the architectural
tourists flocking to Riga. The inside tells a very different story
though. Workers in protective clothing and masks operate
fast-moving machinery under Good Manufacturing Practice
conditions. For this is the headquarters of MedPro Inc, packaging specialists and purveyors of a number of vitamin-supplement and nutritional products. Despite these impressive
sights, the main activity of MedPro Inc is the manufacturing
of active pharmaceutical ingredients and fine chemicals at a
separate facility.
MedPro Inc export
synthesised actives to
20 countries around
the world
Although such syntheses accounts for 70% of the business
(and 95% of that is for export), the company felt that it also
had more to offer the market in terms of the accumulated
know-how that could be applied to the formulation of other
products. Hence MedPro Inc's move into finished products
such as those referred to above.
Packaging and labelling line
What is also interesting is their strategic decision to develop
an in-house packaging and labelling specialty. This is a niche
service which they offer to other pharmaceutical and therapeutic product manufacturers on a contract basis. That packaging service, a result of wise investment, is available to all
for their own products, for re-branded versions of existing
MedPro Inc products, or for completely new formulations
which can be developed from scratch with the help of the
company’s team of research scientists.
Upgraded manufacturing MedPro Inc is a spin-off from
the huge Soviet-era pharmaceutical complex at Olaine (see
the story about Olainfarm on page 9), and initially found
itself with the task of manufacturing large amounts of a
number of active ingredients. They also found themselves
with synthesis processes that required much improvement to
bring the finished products up to international standards.
That that has been achieved is proved by MedPro Inc's ISO
certification for manufacturing and the fact that they now
export these and other synthesised actives to 20 countries
around the world, even as far as Australia.
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www.medpro.lv
The current interests of scientists working in
materials sciences are particularly focused on
the synthesis of nano-materials that display
promising new features, which have potential for many different applications.
Latvia’s engineering industry as a whole, but
particularly the mechanical engineering sector is in a dynamic phase, having benefitted
from new processes, new technologies for
manufacturing processes, new coatings, and
novel composites. Having fulfilled the
requirements of the Soviet military, a high
level R&D platform has been accumulated
which can be applied to present-day research
as well as to products for contemporary markets.
The global drive for environmental safety has
lead to a requirement for new solutions that
avoid the use of chemicals and substances
that could endanger the health of consumers.
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Plasma & Ceramic Technologies
Nano-powder research and
production
Nanotechnology is not only one
of those buzzwords that you
see being used in pseudo-scientific articles or science-fantasy
novels, but a word whose real
significance few people truly
understand. It is actually about
working with very, very small
entities, and here, in Salaspils,
to the east of Riga, we are talking about powders with
unique and selectable properties, and with applications in
the real world.
Since the 1970s, research into the utilisation of plasma hightemperature technology (up to 5000ºC) has been carried out
at the Institute of Inorganic Chemistry of Riga Technical
University. The results of early investigations were mainly
intended for use in military applications during the Soviet
era. This technology can produce very fine powders (particles
with size in the nanometres region can only be seen in electron microscopes) with large surface areas (several hundred
square metres per gramme of nano-powder).
Properties by design
By varying the base material, many different products can be
obtained, but most production results in very hard, chemically and high-temperature resistant ceramic powders. These
properties are maintained by the products made from the
powders, which can be used in many applications – mainly in
the manufacturing of advanced ceramics, from jet-engine
fan blades, to extremely hard ball bearings and brake linings,
cutting tools, bio-ceramics for medical applications, to additives for rubber and modifiers for metals, plastics and paints.
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Plasma & Ceramic Technologies are involved in
more Europe-wide research
projects than any other Latvian company
European partners
Plasma & Ceramic Technologies continues to collaborate with the Institute of Inorganic Chemistry. The latest
scientific and technological
developments are immediately incorporated into unique
products and offered to customers. Plasma & Ceramic
Technologies, together with
the Institute of Inorganic
Chemistry, are involved in
more Europe-wide research
projects than any other Latvian company (including with
collaboration partners in Germany, France, Luxemburg,
Austria, Spain, Sweden, Holland and Italy). They have
ample production capacity
and can design and manufacture nano-powders with
properties to suit the toughest environments.
Plasmalat
A means of applying
extremely hard and durable
ceramic coatings to light
metals
Industrial ceramic coatings
This publication serves as an introduction to many different
technologies operating in Latvia, within the understandable
space limitations of its format. This makes it somewhat difficult to fully explain the astonishing, third-generation Plasma
Electrolytic Oxidation (PEO) technology offered by Plasmalat.
PEO was discovered back in 1960, and is a means of applying
extremely hard and durable ceramic coatings to light metals,
Aluminium, Magnesium and Titanium, and their alloys. The
coating is applied (a simplification) to metallic components
submerged in weak electrolytes and subjected to spark discharges (plasma). This has a number of advantages over competitive surface-hardening methods: it is quick, i.e., costeffective; it is much safer with no exposure to dangerous,
sometimes banned, chemicals or to electrical discharges; the
coating is applied evenly to every surface of the component
while it is submerged in liquid; end results are better in terms
of durability and wear-resistance because of the excellent
adherence of the coating, formed from the actual substrate
metal; in some cases you can even choose the colour!
Faster, third-generation process
At time of writing, Plasmalat are finalising their pilot plant
which will be fitted with a number of additional devices to
follow and refine the PEO process. After that they will construct a production unit, to take advantage of the results
obtained for the pilot plant. In actual fact, 3rd-generation
PEO is so fast (treatment takes only 5-20 minutes as opposed
to several hours in the second-generation process) that some
metal-component manufacturers may even consider
installing units on their production lines. Plasmalat would be
happy to oblige.
Multiple cost benefits
The benefits to users of such products are numerous: light
metal components can replace, and last considerably longer,
than much heavier components made from traditional materials like steel, which are either prohibitively expensive or
quickly corrode in harsh environments (think of huge oil-well
pumps in north African deserts or Siberia as an example);
light metal components are softer and can be more easily
tooled prior to their surface treatment, once again offering
cost savings, and resulting in more accurately tooled parts.
www.plasmalat.lv
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Sidrabe
Sidrabe’s customer list
includes some of the most
recognisable names in
the world
Ultra-thin coating solutions
Sometimes thinner is better. And it doesn't get any thinner
than the coatings which Riga-based Sidrabe enable their customers to put on more or less anything. That is why their customer list includes some of the most recognisable names in
the world in countries like Japan, Korea, USA, Holland and
Germany. Their technological solutions are so advanced that
their customers want them kept confidential and Sidrabe are
not allowed to publicise them.
That is because Sidrabe are actually problem solvers - they
solve incredibly complex coating problems, and then build
the equipment to reproduce the solution in real-life manufacturing environments. Typically, these are one-off solutions
to very specific requirements. They are also expensive. Once
a major manufacturer has gained a competitive edge by
investing in the solution to a tricky problem, he does not
want his competitors to know how he has achieved that.
40 years' know-how
Sidrabe are also a rare example in this publication, in that
their potential has been recognised by a foreign venture-capital investor who owns a majority share of the company.
That potential comes from another Soviet-era story - a
research institute founded back in 1962 to develop vacuumcoating technology. So Sidrabe has more than 40 years of
accumulated know-how and experience to apply to the
unusual requests they receive, and has turned that into a very
successful multi-million business.
Solar films
Another sector they are active in is solar films and they are
currently building the equipment for a major glass-coating
plant which will manufacture products for the European
greenhouse market. This is one of the largest industrial
investments in Latvia, and Sidrabe's contribution is the coating process which allows the glass to transmit more light –
generally the opposite of what a coating does, but then
Sidrabe is full of surprises.
For the electronics industry
One example is telephone and laptop computer batteries - have
you noticed how their life has increased rapidly in recent years?
Part of the reason is the much-reduced thickness of the electrodes incorporated in the batteries. How do you get them thinner? By depositing an ultra-thin layer of a metallic compound on
a temporary carrier, and then removing the carrier. That is the
sort of difficult technological problem Sidrabe provide working
solutions for. Other examples their know-how and equipment is
used for include flat display screen components, flexible-substrate integrated circuits and solar-power cells.
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www.sidrabe.com
The information and communications technology (ICT) industry is one of the most
dynamic sectors of Latvia’s economy and is
considered to have great potential for further
development. The turnover of the sector is
rising rapidly having seen more than 15%
average annual growth over the last decade.
The successful development of the ICT sector
is based mainly on thriving ICT services, the
highest share belonging to the software
development and telecommunications segments.
The Latvian companies active in this sector
work in a number of specialised areas, including software development and re-engineering; the design, development and implementation of information systems, enterprise
resource planning software, contemporary
internet B2B solutions, computerised software tools, payment card systems and the
localisation of international software.
The utilisation of near-shore and offshore
services has increased significantly in the last
few years. Latvian ICT-service providers are
able to offer world-level quality at significantly below-average prices.
17
SmartImage Solutions
Databases and image handling solutions
There are so many gadgets around these days that there are
special shops to sell them. Some sell, because they are useful, many more fall by the wayside. One which has found use
is the automatic rain sensor which turns on and controls the
speed of a car's windscreen wipers according to the amount
of rain (currently seen only on luxury cars, but that is how
electric windows started). A simple enough idea, but have
you thought about the complexities involved? First of all you
need an accurate sensor to measure the size and number of
drops. Not a simple task in itself, but still nowhere near the
complete answer without an inordinate number of mathematical calculations to deal with the variables including frequency of raindrops, their consistence, the speed of the car,
etc. And excluding false starts, because there is nothing
more annoying than a windscreen wiper operating unnecessarily!
Real-time mathematical calculations
That is the sort of mathematics SmartImage Solutions, based
at the University of Latvia's Institute of Mathematics and
Computer Science, handles on a daily basis. Along with
developing the second generation of automatic rain sensor
devices, they have set up systems to measure the accuracy of
microchip manufacture and to identify counterfeit currency
in coin-operated equipment. CEO Péteris Ruçevskis has also
contributed to two software suites which enable the graphical visualisation of business and manufacturing processes.
Now you really can
carry your dictionary
in your pocket
Two completely new concepts
But SmartImage Solutions was founded to develop two key
concepts: Image Understanding and Analysis technology is
an extension of the earlier work in visualisation. In simple
terms, images are analysed and stored automatically, in database fashion, that is with easy retrievability.
Searchable Archive technology is a new database compression method, enabling data to be compressed to the same
size achieved by archiving software, but without losing the
searchability function. While this will appeal to owners of
huge databases like libraries or even search engine developers, imagine what it can do for applications on small devices
like mobile phones - now you really can carry your dictionary
in your pocket.
These applications are ready to go - are there any venture
capitalists reading this?
www.smartimagesolutions.com
18
Tilde
Software and localisation services
Latvia is a small country, and ethnic Latvians barely form a
majority in it. So does that make the Latvian language any
less worth using and conserving than say, Welsh, Catalonian
or French? Well no, say Microsoft and the other major computer software manufactures like IBM and Oracle who have
"localised" their products into Latvian. And those global
trendsetters, the mobile phone manufacturers, concur there isn't a mobile phone sold in Latvia on which you cannot make menu choices or send SMS texts in Latvian, complete with the necessary diacritic marks or accents.
But somebody has to do the hard work of localisation, and
Tilde have been doing it for a long time. Early on, they chose
to go the software route, a decision considered more than a
little foolhardy by their compatriots who saw hardware as the
only way to do business in the new computer age opened up
by entry to the free market, particularly when software piracy
was so widespread.
Tilde has helped Microsoft
and other major software
manufactures like IBM
and Oracle to localise their
products
Software outlasts
hardware
Well, not only are Tilde still here, unlike many of those hardware dealers, but they have expanded their activities into the
neighbouring Baltic States, Estonia and Lithuania. And Tilde
have evolved with the times and the aspirations of the society
in which they operate. Along with the language activities mentioned, they have shown responsibility to their market by sponsoring a Latvian history project which has evolved from a single CD-ROM into a full-on history and language portal helping
Latvia introduce itself to the world. Regular research helps
Tilde stay in touch with the market and one direction they
have taken up is content provision, not just for the aforementioned portal, but also for Internet TV.
Europe-wide terminology
Latvia's entry to the EU has given Tilde access to funds which
has enabled them to speed up their development processes.
They have also become coordinators of a Europe-wide terminology project, the EuroTermBank, linked multilingual terminology resources, and another opportunity for minority languages to ensure their equal treatment with the major EU
languages. If you have a software query regarding the Baltic
States, Tilde can speak your language.
www.tilde.lv
19
Electronics
Our industry has very longstanding traditions
in Latvia the legendary VEF Minox miniature
camera, invented at the VEF factory in 1937,
is known all over the world; telephones or
radio-sets made in Latvia are still used and
remembered fondly in former USSR countries. This success was achieved through the
efforts of Latvia’s highly qualified specialists.
The Latvian electrical engineering and electronics sector has been growing at over 20%
per annum for the past four years. Rich traditions and experience in the production of
electrical engineering and electronics equipment, the dynamism of the companies
involved, and rapid economic development
allow us to be optimistic that the industry’s
successful development in Latvia will continue in the future.
Our vision is for Latvia to become a centre
where hi-tech companies from throughout
the region can meet, co-operate and develop
their businesses. At this time, Riga already
presents a convincing case that it is becoming
a significant economic centre not only in the
Baltic States, but in the whole Baltic Sea
region. A significant factor is its ideal geographic situation between two very important markets: the European Union and Russia.
20
Electronics
Arcus Elektronika
Electronics design and manufacture
Electricity is a given, we expect it to be there, all of the time,
at the flick of a switch. But it is a hugely complex task to get
it from a generator on a dam or in a coal-fired power station
to the factory floor or a domestic kitchen. Industry professionals talk about transmission and distribution, but we average consumers are only vaguely familiar with unmanned,
almost ghostly sub-stations, and massive pylons and wires
traversing the countryside. All this complex infrastructure
needs to be controlled and channelled to the right places, to
keep our modern world functioning. Remotely, that is, from
a central control point away from the actual equipment –
Supervisory Control And Data Acquisition (SCADA), to give it
its official description. And that requires a very sophisticated
combination of software and equipment. And that combination can be obtained right here in Latvia in Tiraine, at the
southern edge of Riga.
Upgrading infrastructure
A delve into recent history is once again required. Latvia
regained independence and inherited a creaking electricity
infrastructure which demanded modernisation so it could be
linked into the European system. Arcus Elektronika founder,
Vitålijs Aißpurs, was working within the sector and was fully
aware of what was needed. What is interesting though is
that he took a strategic decision, a very brave one in those
chaotic times, to offer high-quality modernisation solutions
with equipment sourced from major global, i.e., western
manufacturers. There was much opposition at the time
because of the higher costs involved, but history has proved
Vitålijs was right.
A flexible company that
can quickly come up with
innovative, non-traditional
solutions
Supplying global powers
Since then, Arcus Elektronika has evolved into one of the
leaders of the Latvian electronics industry and has worked
with world giants like ABB, Siemens, GE and Arreva. As well
as meeting Latvian demands, they have very successfully
exported to neighbouring Lithuania, and are involved in
other projects outside Latvia. But it is Arcus Elektronika's very
success in the Latvian market which is forcing them to reexamine their business. Because the equipment they make
works very well and lasts a long time, they need to extend
their market exposure. And they have much to offer - the
experience and know-how they have built up with SCADA
systems stands them in good stead. And as a small flexible
company, they can quickly come up with innovative, non-traditional solutions to problems that large conservative companies struggle with. What is your current problem?
www.arcel.lv
21
Electronics
Autonams
Electronic car security products
To understand the success of Autonams, you have to go
back to the early years of Latvia's independence and the
chaotic times after the break-up of the Soviet Union, when
the first western cars soon appeared on Latvia's roads. As
there were few records and control systems, there was also
an immediate market for stolen vehicles and no shortage of
thieves to meet that demand.
The biggest compliment
is that some SKYBRAKE
features are being copied
Locally available skills
But the people that Autonams were training to install and
maintain them (in recognition of the high level of customer
service demanded by their high-value customers) were more
than capable, having backgrounds in electronics and not
only able to understand the systems, but even suggest
improvements. Autonams realised that they were on to
something and, being in Latvia, in the perfect place to do
something about it to design and produce their own systems. They already had electronics expertise, they soon located software engineers and encryption experts, and people
with wireless signalling know-how. Adding to this the ready
availability of flexible small-run manufacturing, they were
able to manufacture complete security systems, both alarms
and immobilisers under their own brand SKYBRAKE®. In
quick time, Autonams had a skilled development and design
team, and their own production facility.
Multiple protection
Autonams first step into the market was with car marking
where glass components are visibly embossed with part of
the car's chassis number. Encouraged by insurance companies, who were insisting that car owners installed multiple
protection, Autonams also began to import electronic alarm
and immobiliser systems. This is where the company’s path
diverged from that of the traditional importer. Car security
systems are sophisticated technology, continuously advancing to stay ahead of the criminal element.
Already exporting
Today, SKYBRAKE® products are technologically more
advanced than most of the products Autonams import, and
are being exported to six countries, contributing a healthy
35% of annual turnover. The biggest compliment of all is
that some SKYBRAKE® features are being copied by the companies Autonams once bought from. But Autonams have not
stopped their own development. As international cooperation reduces car theft, they have set their sights on the logistics sector, where the identification and locating of loads is a
serious security problem. More proof that market forces are
what really drive progress.
www.autonams.lv
22
Electronics
Biosan
Biochemistry laboratory equipment
Mixing, movement and centrifugation are fundamental elements of many chemical or biological experiments. That does
not sound very high technology, but often the simplest
requirements are the hardest to meet, and so in the greatest
demand. In biochemical research, the preparation of samples for analysis (DNA & genome-structure analysis being
typical examples) can be a complicated procedure, with
many different steps involving those apparently simple
needs.
Biosan has customers in
50 countries and exports
95% of its production
A demonstrable need
Today, Biosan has customers in 50 countries and exports
95% of its production. It has its own manufacturing and
research facility in the green Riga suburb of Kleisti, 70
employees and grew by 300% from 2001 to 2005. What is
more, it has succeeded in attracting a foreign investor and
partner, Grant Instruments of Cambridge in the UK. This is a
synergic relationship with the two partners having complementary products and established networks of customers in
different markets - a very successful model that could be
repeated with many of the companies on this publication.
Shaken, not stirred - remind you of anyone?
Hard to find laboratory basics
And in the Soviet era, despite the relatively large budgets
allocated to scientific research, it was just such laboratory
basics that were often lacking, nowhere more so than at
what is now the Latvian Academy of Science's Institute of
Microbiology. So if you cannot obtain them off-the-shelf,
you have to resolve your needs in another way, produce your
own solution. This principle is what underpins the successful
business that is Biosan today. The self-made laboratory
equipment worked very well, so much so that other people
began to request it. And when the Soviet Union collapsed,
the designers found themselves operating in a free market
with a demand for their useful products, a solid enough basis
on which to build a business.
www.biosan.lv
23
Electronics
Integris
Software integration
We have all watched those
film or TV hospital dramas
where the patient’s heart
function is displayed to the
concerned medical staff and
relatives, so much so that the
term ECG, or electrocardiogram needs no explanation.
They may no longer look as
dramatic as the clunky
machines that required a specialist technician to run them
and large trolley to move
them, but ECGs are more
important than ever in the
public health sector. Most of
those large machines are long
gone, replaced by smaller,
and now, hand held units, as
machine designers take
advantage of the advances in miniaturisation. But those
advances are evident in other fields too, most notably in the
converging fields of telecommunications and information
technology, one of the most prominent examples being
hand-held computers. So, we should not be surprised that,
as soon as in 2007, doctors or paramedics will be holding
their ECG device in one hand and reading off the graphical
results in the palmtop computer in their other hand. Naturally, the palmtop will connect to any standard printer to produce a permanent record, or the result can be e-mailed to a
cardiologist for an expert opinion.
Getting two different
software and hardware
systems to communicate
Taking advantage of convergence
The surprise lies in the fact that these two very different technologies were linked, or integrated, by a Latvian company
Integris. This involves much more than connecting two
machines (even special cables had to be produced), but getting two different software systems to communicate. Integris is not a large company, established in 2003 and with
only four permanent employees, but, clearly, it is intellect
that is producing the results here. While Integris are already
working on the next advances in ECGs (pocket-sized, wearable devices with wireless links to the Internet), they are not
limiting themselves to one field.
From hearts to engines
One current project involves an accurate real-time reading of
fuel tanks and consumption for the road transport industry.
On the surface a simple task, but not so, when you consider
the varying sizes and shapes of fuel tanks, their form being
constrained by vehicle size and design trends.
Integris current expertise is focussed on the application of
mobile technologies, but they are happy to look at other sectors, but realise they will need to grow, both in numbers and
applications. A case of becoming larger to achieve smaller
things.
www.integris.lv
24
Electronics
Real Sound Lab
Sounds perfect
The search for perfect sound reproduction has been a human
endeavour ever since Edison invented the forerunner to
today’s record deck. And there have been huge leaps of
progress since then. Oddly enough, the record deck itself has
made a comeback thanks to the DJing scene, and seems set
to stick around despite much more convenient forms of conveying recorded music. Tapes and cassettes have almost disappeared as the march of miniaturisation and digitalisation is
so visibly demonstrated with the arrival of the ubiquitous
iPods and mp3 players. This is not the place to debate the
nuances between digital and analogue recorded music, but
there is one thing they do have in common for us to hear,
music has to be played through loudspeakers. Now loudspeakers themselves have made massive progress in their
ability to reproduce sound (see the story about sound equipment manufacturer VEF Radiotehnika RRR on page 27), but
they still require adjustment to perform to their best ability.
That adjustment can vary from a simple treble or bass control knob, to the huge banks of slide switches on the
graphics equalisers we see in recording studios and at major
live concerts. This used to be the realm of expert sound engineers, but more and more of us are familiar with the virtual
graphic equalisers of computer music players like Winamp
and iMusic. As is frequently the case however, putting hightech functionality and tweaking ability in the hands of amateurs only rarely produces good results. And many will concur, that not all the so-called experts with their banks of
switches at live venues do it any better!
Analyse the sound,
adjust it to perfection and
deliver it to the speakers
Two sets of skills
This is where Real Sound Lab comes in. As with many solutions to complex problems, the answer has come from a mixture of two skill-sets. Sound engineer Raimonds Skuruls has
worked the slide switches at many a concert and recording
session, in fact, he progressed to owning his own studio,
because he was in so much demand. The skill that gave him
this ability is his acute hearing which enabled him to tweak
the controls to really make a difference. But even Raimonds
was frustrated by having to go through a myriad of adjustments each and every time (the sound-check). He had also
tried many of the solutions claimed to offer assistance, purveyed by some of the biggest names in the professional
sound industry, but none of them really worked. He understood what they were trying to achieve, because as a professional sound engineer, Raimonds was also familiar with the
electronics involved. The theory is fine - analyse the sound,
adjust it to perfection and deliver it to the speakers - and
undoubtedly works in closely-controlled testing-studio environments. The problem is transferring that functionality to
practical settings, where a speaker being in a different position, or local acoustics make so much difference.
Apparently simple solution
The solution appears remarkably logical and relatively simple,
but then the best solutions always seem to be. Take the same
principle of analysing and adjusting the sound, but sample it
at the end point - at the speaker itself. The result is Acoustic
Power Frequency Response-based Correction, available in
the shiny boxes you see in the photographs, or as software
you can use to get amazingly good sound from those little
speakers you have attached to your computer. That description is certainly a mouthful, but hey, listen – it works!
www.realsoundlab.com
25
Electronics
SAF Tehnika
Market leader in telecoms infrastructure
One day, SAF Tehnika will be a classic case study for business
students, if it hasn’t already become one. It’s a straightforward story: identify a need, formulate and construct a solution, commercialise the solution and create a hugely successful business, one that, in its less than ten-year existence, has
achieved a global top-ten position in its sector. Of course, if
it were that simple, there would be a lot more SAF Tehnikas,
A perfect marriage
of technological progress
and business acumen
so where are they? One answer is that SAF Tehnika is a perfect marriage of technological progress and business acumen. The technological solution comes in the shape of what
was designed to overcome the original problem, a lack of
fixed telecommunications infrastructure in Latvia's more
remote rural areas (even though Latvia is a small country,
such infrastructure was not at the top of the Soviet authorities priority list), at a time, a few years ago, before mobile
telephony had extended its reach outside the main cities. So
electronics engineer Didzis Liepkalns designed his own wireless exchange to link himself into the fixed infrastructure. He
was happy enough that it worked, but when he soon found
that other people wanted him to build copies for them, he
realised that he had a commercial proposition.
From idea to business success story
This is where business acumen came in, and rescued a brilliant idea from the obscurity most inventions disappear into.
Normunds Bergs had earned his business spurs in the early
chaotic days of the post-Soviet free market, in a particularly
competitive field IT equipment and services. He understood
the value of sales and marketing, of looking after customers,
of maintaining stocks of, and delivering equipment and
parts. The rest, as they say, is history. Much could have gone
wrong, because SAF Tehnika had to fight through the early
2000s downturn in the mobile communications industry.
They did that by supplying quality, value-for-money equipment and making sure that they stayed ahead of the game
technically, through improving and extending their product
range. They already export to 56 countries, and in 2004
acquired a Swedish company, Viking Microwave AB, to
extend their know-how and product range. Wasn't it supposed to be the other way around?
www.saftehnika.com
26
Electronics
VEF Radiotehnika RRR
Advanced acoustic systems
Total silence. No hard surfaces, not even a solid floor. High,
high ceiling. It seems incongruous that this is the environment in which sound-producing acoustic systems are developed, tested and refined. But this is an acoustic testing
chamber where silence reigns so that sounds can really be
heard – absolutely nothing else.
In what may appear to be a second incongruity, the silent
edifice under discussion is located in Riga, across from the
city centre, on the left bank of the Daugava river. But that is
no surprise to those in the know, industry professionals,
because there are a number of histories interwoven here,
immediately apparent from the company's name.
prise continues to design and produce printed circuits for the
company itself, but increasingly, as a contract manufacturer
for others.
EU funds the future
That is some history to live up to, and there is no question
that VEF Radiotehnika RRR is carrying on its proud traditions.
New product development is continuous, with 5-6 new models being launched each year, DVD-home-theatre systems
being a recent development of note. Thanks to a EUR 1.4
million ERAF structural fund injection, production facilities
have undergone major modernisation, reflected in export
sales to 10 different countries reaching more than 70% of
production.
And the company continues to progress. Development of
professional acoustic systems for the DJ and live music scenes
is well underway, and soon VEF Radiotehnika RRR will offer
development and design services in both electronics and
acoustic systems. Thanks to their testing chamber, you will
be able to hear the difference.
The sound of silence
www.rrr.lv
Historic brands
There are many Radiotehnika products still working throughout the former Soviet Union – Transistor radios, cassette
decks and record players – some even reached export markets. They were produced at RRR (Rîgas Radio Rüpnîca - the
Riga Radio Factory), founded in 1927 and manufacturer of
some wonderful radios and record players, examples of which
can be seen in the company's museum. The VEF name also
dates back to the 1920s and is a legend for its invention of
the tiny Minox cameras obligatory in any early spy movie.
Known for its electronics expertise, the VEF part of the enter-
27
Technology services
While it is generally considered that it is
easier to export commodities than services,
Latvia’s current situation may be the initiation of a new trend. Latvia’s negative trade
balance, overall an outcome of commodity
trade, is significantly offset by the positive
balance in the services sector.
High level technology-intensive services outsourced by foreign research organisations
and multinational companies have played a
significant role in development of Latvia’s
economy, but the country still possesses
untapped R&D capacities.
Latvian companies and researchers have
been working on projects seeking sophisticated solutions in a broad area of activities,
covering all of the fields touched in the catalogue and many others.
28
Technology services
UNICONE (Junikon)
Talking soil engineering
in many languages
Soil and strata testing
The sight of new building foundations being set out and laid
is a common one around the world, but almost inescapable
in Latvia's current construction boom. But how do you know
how deep and robust to make the foundations, the structure that holds up the entire building? Well you drill and probably take soil samples to establish the composition, structure
and condition of the underlying strata. Then you take your
samples to a laboratory where they are tested, ideally under
real testing-site conditions, rather than just as isolated samples. Sadly, in this day and age, you also need to test the environmental condition of the site, whether it has suffered any
pollution in the past. But what if you need to build on or
underwater - a pier, bridge, oil platform, or lay a pipeline?
Full range of tests
Each and every one of these additional conditions adds several degrees of difficulty to what initially might appear a reasonably simple requirement. So, who do you turn to? Well,
in Latvia, there is someone you can turn to. Regardless of the
degrees of difficulty, UNICONE will provide the results that
engineers and architects need to proceed to construction yes, even if the site is under water. Because UNICONE have
their own survey ship which can take samples even from
deep-sea sites. Once the samples are obtained, UNICONE’s
fully accredited, ISO-certificated laboratory can carry out a full
range of tests, including recreating real conditions to provide
a true picture of a site's capacity to support construction.
It will be no surprise that
UNICONE are the only company in the Baltic States with
such extensive capabilities,
and they are also already
exporting their services to
Norway, Poland and Russia.
Bridging cultures
And UNICONE have an additional forte - their ability to
bridge the clash of cultures
which accompanies many
international projects, particularly those managed by
western companies in the former Soviet sphere of influence. UNICONE’s skills and
know-how are founded on
Soviet-era exact science and
research, but to this they have
added 15 years of experience
working with international
engineering and construction
companies - they talk soil engineering in many languages,
and have published their own terminology dictionary to
prove it.
www.unicone.lv
29
Technology services
Biotehniskais centrs
Biochemical reactors and process automation
A common but key business strategy problem - if a market is
not big enough you must find other ways to either deliver
your product or service into new markets, or use your skills to
extend the range of what you can provide. That is exactly
what Biotehniskais centrs has done. Much of the company's
initial expertise came from the doctoral dissertation of
founder Juris Vanags. His successful design for bioreactor vessels comes with two key advantages. Firstly, they are run by
magnetic drives, which make cleaning them much simpler
and less time-consuming – a significant cost saving considering the types of reactions and constituents they host. Secondly, process control is managed by non-proprietary controllers,
programmed in the Basic software language. This gives them
a fundamental lead over proprietary controllers which run on
more complex software, frequently requiring specialist technicians or programmers to adjust them. Biochemical reactions
are typically complex - they take a long time and require many
adjustments to process conditions like temperature, pressure
and stirring velocity. With simple Basic programming, close to
everyday language, it is a simple task to adjust the process,
something which is often required as processes are refined, or
changed to accommodate variations in natural materials.
Such flexibility is not achievable with proprietary controllers.
Cross-industry application
The successful design meant that Biotehniskais centrs very
quickly became established, but it did not take long for the
company to realise that its market was limited by Latvia's small
size. The initial success though, meant that the company was
asked to help with other processes, in the food industry, the
first customer being one of Latvia's best-known and favourite
brands, confectionary maker Laima. It soon became apparent
that the process-control principles which had been used in
designing the bioreactors had application in the automation of
many of the processes utilised in the food industry.
It is a simple task to
adjust the process,
regardless
of its complexity
Since that realisation, Biotehniskais centrs has gone from
strength to strength and can now number every significant
Latvian food processing company as a customer. Not only that,
but the growing process-automation expertise has been
extended into other industries, like pharmaceuticals and glassfibre producer Valmieras stikla ß˚iedra (see page 41), and into
other countries including Germany, Switzerland, Russia and
Ukraine. The company is also active in international collaborative research under the EU's EUREKA and CRAFT programmes.
www.btc-automation.lv
www.bioreactors.net
30
Technology services
Peruza
Food processing engineering
The astonishing growth in the Latvian food processing sector
in both production quantities and the number of producers
is highlighted elsewhere in this publication. That growth has
required the installation of a lot of new plant and machinery,
often at start-up operations without large sums to invest.
Meeting such engineering demands requires a degree of creativity, and oddly enough, Peruza's creativity comes from the
Soviet era.
Working in partnership
with the customer to produce a functioning solution
Particularly in the later years, when trade barriers were falling
and Soviet food products were being sold to western markets (tinned Riga sprats being one of the forerunners), engineers found themselves having to meet western product
standards with Soviet-era materials and resources. The
inevitable outcome was the development of creative solutions and it is this creativity which forms the basis of Peruza's
know-how and application skills, and explains their success.
Solid international experience
After a solid founding in mechanical engineering, including a
period at the legendary VEF (see page 27), Peruza's founders
originally worked with a French engineering company who
began selling their equipment into Latvia and then the huge
Russian market. Russia’s economic crises put a stop to the
latter and Peruza returned to the Baltic States, particularly
Estonia where they enjoyed some early success. That success
has already been extended into other export markets, including France, Sweden and Russia, and other industrial sectors,
such as pharmaceuticals.
Understanding production needs
Peruza's success is down to their fundamental knowledge of
the engineering aspects of production processes allied with a
very practical understanding of the limits of resources. They
work in partnership with their customer to produce a working solution without unnecessary extras. But that solution is
always adaptable and upgradeable, so that the customer can
add refinements like additional steps or automation as
increasing resources allow.
www.peruza.lv
31
Food Technologies
Latvia has always been richly endowed with
food resources, particularly fish, dairy products, grain, meat and wild berries and mushrooms. Historically, Latvia has been both
“Sweden’s
Larder”
and
later
“Russia’s
Larder”. It is these traditions that have been
the foundation of Latvia’s modern food &
drink industry.
In parallel, the technologies of modern food
processing over the world over have evolved
from humble, domestic origins. Latvia is no
different, many foods we recognise on supermarket shelves and in restaurant menus can
be traced to traditional recipes and methods.
32
Food Technologies
Iecavnieks
Rapeseed oil is already
being used in diesel
engines
Oil and seed products
The flat plains of Zemgale, in Latvia's south east, have long
been a source of agricultural products. But, to paraphrase
Latvia's best-known author Rainis - if you don't move with
the times, you will not survive. And there is no question that
Iecavnieks is moving with the times.
Green fuel opportunity
But Iecavnieks soon realised
that the size of the market
limited their opportunities,
and that they had additional
processing and storage capacity above even that sold to
other producers as a service.
It did not take much research
to recognise that bio-fuel
offered an opportunity, and
that rapeseed oil was already
being used in diesel engines.
Rapeseed also offers a better
return for growers. Things
moved quickly, and as well as converting their own fleet of
farm and transport vehicles to green rapeseed fuel (achieving
significant cost-savings in the process), Iecavnieks were soon
exporting rapeseed oil to fuel companies in Germany and
Austria.
Sugar beets are history
Zemgale once grew enough sugar beet to supply three sugar
factories but that era is rapidly coming to a close. Iecavnieks saw
an opportunity for oil-seed crops, and having taken advantage
of EU SAPARD funding to install storage and processing facilities, were the first local company to introduce domestically harvested oil and seed products to the Latvian consumer market.
Their brightly labelled rapeseed, linseed and hemp* products
already grace every supermarket shelf in Latvia. And rapeseed
by-products are used to produce high-fibre animal-feed cakes
suitable for both pig and dairy farming.
Legislative update
All is not ideal, though, and Iecavnieks may yet need to revisit the flexible thinking they have so successfully utilised in
the past. Despite the push towards sustainable fuels from
renewable natural resources like rapeseed, and the rising
prices in the petrochemical industry, incomplete legislation
has made the market uncertain, with producers unwilling to
risk investment until regulations are finalised - may we suggest they get their act together, like Iecavnieks have.
www.iecavnieks.lv
*historical note: Latvia has a tradition of producing linen (the world's oldestknown textile) for clothing & table "linen", as well as hemp, whose main use
was ropes for shipping
33
Food Technologies
Neo
Neo’s team of food
technologists help Latvian
food manufacturers with
a whole range of processes
and ingredients
Food technology services, e-commerce
First-time visitors to Latvian supermarkets are often surprised
by the number of local food manufacturers represented on
the shelves. While many international brands are present,
there is still a larger proportion of local names than you would
expect in a country as small as Latvia. Neo is one of the reasons why. Yes, Latvia has a long-standing agricultural traditional and many different crops are grown and animals bred,
but the local climate places a severe limit on what is available
from local producers. Add to that the ever-increasing sophistication of modern tastes, and there is a clear need to spice
up Latvian food staples and mix them with more exotic foods
and flavours to make them more appealing. And Neo has a
team of food technologists that help Latvian food manufacturers with a whole range of ingredients from all over the
world, sourced from the numerous food specialty companies
they are in partnership with.
Business evolution
While such a business model is not unusual in itself, it is how
Neo got here that is an interesting tale of business evolution.
Neo started out in the refrigeration and ventilation business.
They established a reputation with both clients and suppliers
because they were committed, reliable and understood the
importance of customer service, a rarity in the early post-Soviet period. Because of that, they were asked to advise on who
might be a good distributor for Denmark's Christian Hansen,
a world leader in dairy product flavourings. After some consideration, Neo realised that they themselves were well connected in the dairy industry because of their refrigeration experience and decided to take a risk and offer themselves. Now the
food technology service business is Neo's core business, while
the refrigeration business has gone, having already fitted out
most Latvian food processing facilities.
Business extension
But Neo continues to make adventurous business decisions
and have since also moved into landscape design and e-commerce - what's next?
www.neo.lv
34
Food Technologies
Pure Food
Fruit and berry products
Latvia's summers are very pleasant, but rather short, hardly
surprising at a latitude of around 56°North. Even though
Latvia gets a mention in the Guinness Book of Records as the
northernmost place grapes have ever been grown commercially, it is not a place where you would expect to find huge
quantities of fruit. Which makes it all the more surprising to
find a sophisticated, state-of-the-art fruit processing plant in
the small town of Püre in Kurzeme, an hour's drive northwest of Riga. As with many of the companies in this Catalogue, Pure Food had small beginnings.
Expertise in designing,
producing and supplying
natural fruit ingredients
Beyond a simple start
Soviet central planning had endowed Püre with an agricultural
experimental station where hybrids were developed to
improve the yields of fruit trees and berry shrubs. With reasonable quantities of fruit available, a small processing plant was
established to produce mainly jams and preserves. This plant
survived the early post-independence chaos by continuing to
produce in small volumes, and may well have still been doing
that, but for the entrepreneurial vision of company principal
Aivars Ûimants and the quality of his products.
Customers are manufacturers
Pure Food still has a very strong presence in the Latvian consumer market (with jams, juices and pickles), but 85% of its
production – fruit and berry ingredients - now goes to industrial
users – dairies, confectioners and bakeries.
In parallel with Latvia's astonishing pace of economic development, the sophistication and expectations of its consumers and,
in turn, the manufacturers serving them, have advanced rapidly. End users have expectations of their favourite brands, and
manufacturers have technological requirements and standards
for ingredients of consistent quality to meet those expectations.
And those requirements can vary widely, for instance, the properties of a ripple for an ice cream manufacturer are completely
different to those a baker needs for a pie filling, even though
the fruit flavour is theoretically the same. So, as Pure Food’s
customer base has developed, so have their range of products
and their expertise in designing, producing and supplying
them. And rapid expansion required major investment in a
new manufacturing facility, opened in 2006, and now employing around 120 people. The plant is already producing up to
600 tonnes of fruit and berry ingredients per month, but has
the capacity to more than double that. And the citizens of
seven neighbouring countries are already enjoying the fruits
of Pure Food’s labours.
www.purefood.lv
35
Food Technologies
Satori Alfa
Latvians wax lyrical
about the wonders
that the berries of this
tall shrub can perform
A wonder of nature
If you asked most English-speaking people what they know
about sea-buckthorn or sea-berry, they would look at you
blankly. But if you asked a Latvian about smiltsér˚ßki (or Hippophae rhamnoides to give it its full name), they would start
telling you about the wonders that the berries of this tall
shrub can perform. Put sea-buckthorn in Google and you will
also see that its curative powers are being discovered around
the world.
Hardy survivor
Originating in central Asia, sea-buckthorn is a common sight
in the sand dunes of Latvia's extremely long coastline,
because the plant can thrive in salty environments and so outgrow its less hardy competitors (its tough branches help it survive the winter, too). That is why it is so well known in Latvia,
36
and has long been an ingredient in folk remedies. It is a
rare Latvian bathroom that
does not have a tube of seabuckthorn restorative cream
in the medicines cabinet, and
an ever rarer pharmacy that
does not stock one or more
versions of this national
favourite. A browse through
the pages of this publication
will also reveal a number of
other companies using seabuckthorn extracts in a variety
of products.
Commercial quantities
Unsurprisingly, the plant has
already attracted horticulturists and hybrids have been
bred to increase the quantity
of berries and hence the yield
of juice, seeds and oil. As
demand increases, more
commercial plantations are
established, and this is what Satori Alfa has done. Their first
crop has been harvested as you read this, and will have been
processed by the specially designed equipment commissioned by Satori Alfa. Much of that harvest will be sold, in
various forms, to commercial buyers and sent around the
world, but some will be held back for company principal,
Måris Selga's pet project, a "whole" sea-buckthorn drink.
Måris has done a great deal of research into this amazing
shrub, and can blind any listener with the science behind its
beneficial properties. This is not the place to explain the three
antioxidants and the synergic interactions between the 18
amino acids and 14 vitamins. But the research has proved to
Måris that, to gain the full benefit of sea-buckthorn, it is vital
to consume the entire berry: fruit, skin and seed, hence his
"whole" drink recipe. And that drink promises to be one of
those rare combinations: something that tastes good, but
also does you good - Prosit!
Chemistry
Chemistry is integral part of our daily lives,
from the foams and gels in our bathrooms
and the shoes on our feet, to the colours
around us and the electrical appliances that
make our lives more comfortable. Chemicals
help to make our environment safer, more
comfortable and pleasant.
Latvia’s long experience and traditions,
strong manufacturing base and high-level
R&D competence makes the country’s chemical sector particularly attractive for business
activities. Latvia’s chemical industry comprises
two main segments export production of
pharmaceuticals, raw materials and partprocessed products (e.g. casein, glass fibre
and its products) and the manufacture of
paints, industrial and household chemicals for
domestic and regional markets. As a result,
exports make up 54.3% of manufacturing volumes.
As an outcome of history and traditions,
Latvia possesses a strong manufacturing base
in fine chemicals and pharmaceuticals, producing a wide range of items, ranging from
petrochemicals and manmade fibres to paints
and household chemicals.
The chemical industry accounts for 5.5% of
total value added within the manufacturing
sector. It is the 7th largest manufacturing
industry in Latvia and shows one of the highest growth rates in comparison with other
sectors (approx. 15% in 2005).
Rubber and plastic products comprised the
largest share of the industry’s output in 2005
(52.1%) followed by pharmaceuticals, medical
and phyto-chemical goods (28.6%).
37
Chemistry
Dzintars
Making an idea into a
product Dzintars
has it all in R&D and
GMP production
Bio-cosmetics and perfumery
Amber is the semi-precious stone formed from pine sap
which, in ancient times, induced many traders to travel enormous distances to the eastern shores of the Baltic Sea where
it is found, particularly on Latvia's exposed western beaches.
So sought after and widely known, Amber's Greek translation Elektra is what has given us the modern word "electricity". And the Latvian name for Amber, Dzintars, was just as
widely known throughout the Soviet Union for the best perfumes and toiletries available in that era, all produced in Pårdaugava, Riga's very own Left Bank.
A natural move
Dzintars use of natural extracts started 20 years ago, but has
been much extended into a full range of skin- and hair-care
products – creams, lotions, gels, shampoos and conditioners.
In having both its own research and production facilities (the
latter with Good Manufacturing Practice certification), Dzintars is something of a rarity in Europe, as many global brands
moved production off-shore long ago. That is why Dzintars
is also gearing up to provide a full contract development and
manufacturing service to other companies. And they have
quite some impressive research and know-how to offer: as
well as in-depth research into, and new methods of extracting raw materials, Dzintars researchers have lodged a number of patents for lip glosses and other cosmetics. And they
can still provide the perfume of your dreams.
www.dzintars.lv
A century of tradition
Dzintars history goes back as far as the nineteenth century,
although the evocative name was coined in the 1950s. The
brand name lives on, but the company, its image and products
have evolved just as dramatically as the Latvian economy in the
period since independence was regained. As with many of the
companies in this publication, the early post-independence
years were a struggle, with Soviet markets cut off or in various
stages of economic crisis, and sources of raw materials and
packaging simply disappearing without trace. Anyone viewing
the stunning examples of perfume bottles displayed in Dzintars
elegant foyer will understand that a formidable transformation
has been successfully undertaken.
38
Chemistry
Ritols
Sustainable resources
are being utilised in some
unexpected everyday
applications
Building products from natural sources
Looking at the products that Ritols teams apply at building
sites you would be hard-pressed to imagine that they come
from natural, renewable sources. Polyurethane as foams
for insulation and as liquid in lacquers and glues, hard
epoxy flooring - they don't come any more artificial than
that, surely?
Applying research results
But if you look into the background of Ritols owners and
founders, you soon realise that the "natural" story is true.
There are not many companies run by four PhDs, and even
fewer which provide the sort of practical construction services delivered by Ritols. Which is why it is worth looking at the
smart business thinking which has made them a successful
company with a turnover approaching 1 million Euros and 25
employees.
The company principals all continue their research within the
Polymers division of Latvia's Wood Research Institute. No
surprises there – wood and its products are Latvia's dominant
export. Their first research revolved around Tall oil, or liquid
rosin, a viscous yellow-black liquid obtained as a by-product
of wood pulp manufacture. This was looking ahead, because
there was a long-term plan to build a massive cellulose plant
in Latvia. Unfortunately, that plan was shelved, so they have
to look elsewhere for their basic raw material. They have
worked with sunflower seed oil, but this is not easily grown
in Latvia. Rapeseed is, and there is a plentiful supply, so that
is the current focus and the project has already reached the
pilot manufacturing stage (although Ritols are also in discussion with Icelandic researchers about utilising fish oils, and
with Americans about soy-bean oils).
Research costs money
The business side of this story is how Ritols commercialised
their own inventions with the construction applications
already mentioned, and even by manufacturing some consumer products which are exported, and the revenue from
which fund continuing research. This was started in the early
days of Latvian independence, when research funds dried up
completely and the cost of finance was prohibitive. Things
are different now and Ritols and the Institute are involved in
international research projects under the EUREKA and CRAFT
schemes, and are talking to venture capital providers. But the
great thing is that the know-how has not been lost and sustainable resources are being utilised in some unexpected
everyday applications. If only all academic researchers were
so practical.
www.ritols.lv
39
Chemistry
Bapeks
Fine chemical building blocks
The highly competitive sector of fine chemicals synthesis
occupied by the Bapeks company is about as far removed
from the mass production concept as it is possible to be.
More often than not, the quantities involved are exceedingly
small, sometimes as little as 10 grams is sufficient, even for a
customer involved in a long-term research project.
As the world’s knowledge of chemistry and biochemistry
deepens, we research and eventually manufacture more and
more complex molecules. But many of those molecules can
be constructed from "building blocks", or intermediates,
themselves complex molecules, and it is these that are Bapeks
speciality. For the end users of Bapeks products, who are likely to be chemists and biochemists involved in research projects, or in medical research or diagnostics, the convenience is
that they do not have to become involved in complex and
time-consuming synthesis, but can concentrate on the outcomes of their actual research.
The end users of Bapeks
products are likely to be
chemists or biochemists
Global reach
In this narrow and specific field of activity, Bapeks is one of
a very few players, but with global reach and reputation.
When seeking an explanation on how such expertise can be
found in Latvia, we return to one of our recurring themes, a
large Soviet-era enterprise with a considerable research
budget. Bapeks inherited one product whose manufacture
enabled them to survive the move to the free initially supplying former customers in the CIS. In time, Bapeks was in a
strong position – able to extend its expertise and build business with western companies.
Academic input
Located in the Riga Technical University campus on îpsala
island just across the river from the city’s centre, Bapeks has
taken full advantage of the cooperation opportunities
offered by its academic environment. The company now has
a catalogue of nearly 500 products, with 30-60 new ones
being added each year, and its customers include some very
big names in the scientific world.
www.bapeks.lv
40
Chemistry
Valmieras stikla ß˚iedra
The utilisation of glass-fibre
products is a widely used
indicator of how far
a country’s economy
has developed
Manufacture of glass fibre and products
The utilisation of glass-fibre products is a widely used indicator of how developed a country is, because of their very specialised applications. The higher the amount of glass fibre
utilised, the more advanced the country and its economy. So
how come there is such highly advanced manufacturer and
processor of glass fibre and its products in a small country
like Latvia, only recently a member of the European Union?
German investment and know-how
Things began to look up in 1996, when a major share in the
company was acquired through a privatisation agreement by
Germany's P-D Glasseiden GmbH Oschatz. Not only did the
new shareholder bring access to, and knowledge about new
markets, but as part of the agreement, invested in upgrading
manufacture, most visibly in the form of a second furnace
and production line completed in 2001.
Production and further processing
Once again, we have to go back to the Soviet era of central
planning for the answer. There were sand deposits, a key ingredient of glass, near Valmiera, a small, quite industrialised city in
Latvia's northern region of Vidzeme. Unfortunately, no one
checked if the sand was of the correct type, but that did not
stop the original Valmieras stikla ß˚iedra (Valmiera glass fibre)
plant being built in 1963. What was unusual about the plant
from a western European perspective was that it produced a
range of additional products, such as yarns and woven glassfibre textiles on site, rather than selling to secondary processors.
Further investment came in the form of a second German
shareholder in 2002 Vitrulan Textilglas GmbH. The latter has
opened up access to markets for further-processed products
culminating in the construction of a new state-of-the-art
glass-fibre textile plant, commissioned in 2006. Once that is
fully operational, it is expected to double Valmieras stikla
ß˚iedra anticipated 2006 turnover of EUR 50 million within a
few years. That will give Latvia and Valmiera in particular, a
very solid manufacturing base – a key to economic stability.
www.vss.lv
The toils and tribulations of the post-Soviet era are a recurring theme in the stories published here, but, if anything,
Valmieras stikla ß˚iedra felt it harder, because of their
unstoppable production process you cannot just switch off
a glass furnace until the next order comes along. So it was
imperative that new markets be found and it is to the credit
of the company's management that they did that, by a multitude of means, kept the company going and saved what is
now more than 900 jobs.
41
Wood-processing
Forests cover nearly half of Latvia’s land area.
Thanks to abundant forest resources one of
the country’s major national assets, wood
processing continues to be, as it has for
decades, one of the key branches of the
national economy.
Over recent years, Latvian wood industries
have experienced steady growth and proven
to be competitive in international markets,
not only in Europe, but also in such far-away
regions as the USA and Japan. This has been
achieved largely as a result of the ability of
the Latvian wood sector to pool international
and local financial resources for the modernisation of production, product development
and promotion.
42
Wood-processing
Latvijas Finieris
Very few successful
businesses maintain their
success without
continuously examining
and improving what
they do
Wood processing
You have a perfectly good product, selling well, making lots
of money. Life could not be easier. Unless you look forward
and have a vision to become more competitive, to do things
more smartly, to take advantage of technological innovations. That is when the hard work starts, but there are very
few successful businesses that maintain their success without
continuously examining and improving what they do.
And the most prominent company, Latvijas Finieris, in Latvia's
largest economic sector, the timber industry, has proved itself
to be very adept at self-improvement. Latvijas Finieris is
already a very large and successful company, producing and
processing plywood, whose figures speak for themselves:
Latvia's 2nd largest manufacturing company, turnover EUR
145 million in 2005, exports to more than 40 countries and
product development and regional sales offices in 10 of those.
Products: plywood is not a new material, and has many
established classical uses, but technological improvements in
glues, coatings and utilisation of laminates has opened up
many new areas, from the manufacturing of isolation panels
for liquefied gas tankers to weather-proof, easy
to handle and safe road signs
Logistics: customers can hugely reduce their storage space
as Latvijas Finieris will design delivery methods and quantities
to suit customers handling equipment enabling them to feed
plywood sheets directly into their production line - just-intime delivery taken to the extreme of customer convenience.
www.finieris.lv
Innovation across the board
The size of this publication limits the number of innovative
changes we can list here, but the few selected are an
attempt to show how broadly Latvijas Finieris have looked to
improve:
Raw material: as well as buying in logs, the company manages its own forests to ensure a sustainable supply
Production: where once, birch wood had first to be peeled
into veneer sheets and then sorted, a cumbersome exercise
requiring huge storage space and inescapably producing
much wastage, logs are now examined electronically and
sorted prior to peeling
43
Wood-processing
Laiko
Plywood furniture components
Not many people will have heard of Laiko. Hardly surprising
given their location an hour's drive east of Riga, near the
small town of Malpils, in the even smaller village of Upmalas.
But the hive of activity which is the Laiko manufacturing
facility employs 500 people, considerably more than live in
the village itself. And the furniture components produced in
Upmalas travel around the world and are very well known to
sector professionals.
Latvia has a plenitude of
birch forests, the traditional
raw material for plywood
A new company
Unlike many others described in these pages, Laiko is a completely new enterprise, founded in 1994, since then becoming part of the Saga Group, itself a new company. It is the
largest part of the Saga Group, and its starting point, as it is
Laiko that peels logs and produces plywood for the whole
group.
From its small beginnings, Laiko has progressed through a
number of development stages, now running five production
lines, but with more in the planning stages. The company
produces components large and small, always to customer
order, although that order may vary from a detailed specification and drawing to a vague idea, in which case Laiko will
help the customer design the component. They have flirted
with extending their production into other furniture components, but have understood that the market is large and specific enough for them to concentrate on adding value to plywood.
44
Fashionable materials
That is helped by Latvia's plenitude of birch forests, the traditional raw material for plywood. But furniture design is
lead by fashion, so alternative materials like beech and oak
are also coming into vogue, and the procession of different
colours and finishes seems to be never ending. Technology
has also advanced giving more strength, rigidity and shaping
options which in turn opens up new design possibilities. As
the result an EU-funded research project, the company came
up with a radically new chair-leg manufacturing process,
which not only saves on material costs (strength achieved
with thinner material), but also resulted in improved quality
and optimised production. Laiko Director Edgars Neifelds
readily admits, too, that fashion trends have favoured the
company's development – Scandinavian design continues to
be a strong influence, while the retro-fashion return to the
1970s also helps plywood component sales.
www.saga-group.lv
Wood-processing
Bolderåja
Large-scale Oriented Strand
Board production will
commence in mid-2007
Particle board
Chip board, or particle board may not be the most glamorous of products, but it is a fundamental material used
widely in contemporary building construction and furniture
manufacture. And Latvia's history in forestry and timber
mean that particle-board manufacturer Bolderåja, situated in
the outer suburb of the same name at the mouth of Latvia's
Daugava river, just downstream from Riga's main port areas,
has been ideally situated to take advantage of the plentiful
and sustainable supply of locally available raw materials.
International investment
This accomplishment, and the potential for more was
recognised by industry giant Kronospan, who acquired the
company in 2005. Kronospan, founded in Austria way back in
1897, has 26 manufacturing sites in 24 countries so have a
full understanding of the industry and its continuing growth.
Quality improvement
First opened in 1969, the company underwent privatisation
in 1993 and suffered the economic tribulations of the postSoviet period, with loss of access to markets compounded by
periodic economic crises. While overcoming those difficulties, the company also managed to improve its production
processes and the standard of its finished products culminating in the achievement of ISO 9001 certification in 2000.
Bolderåja also extended the range of its products by introducing more colours and textures in its melamine-faced
range of furniture products.
And growth is the intention for Bolderåja, because, at time
of writing the construction phase of a totally new production
plant is nearing completion. The plant, a considerable investment, will commence operating in mid-2007 and be capable
of producing 500 000 m2 of Oriented Strand Board (OSB)
annually. OSB, called Sterling board in the UK, has improved
strength, rigidity and useful life compared to traditional particle board, and can replace more expensive plywood in
many applications. It is anticipated that 80% of Bolderåja's
OSB production will be exported, mostly to Russia, and the
plant will offer 200 new jobs additional to the company's
current 230 employees.
www.bolderaja.lv
45
Technology
profile of Latvia
Basic facts
General (2006)
Location
Area, km
North-east Europe
2
64 589
Population, mill
2.33
Capital
Riga (population 0.7 million)
Other cities
Daugavpils, Liepaja, Jelgava,
Jurmala, Ventspils
Foreign languages
generally spoken
English, Russian, German
Currency
1 lats (LVL) = 100 santims
Exchange rate
1 EUR = 0.7028 LVL (fixed)
Economy and R&D
2005
GDP per capita, EUR
5 550 (7 005*) 14.2
GDP growth rate
10.2 (11.9*)
9.5
7.0 (6.6*)
3.9
Inflation rate
(percentage of GDP)
0.57
19.2
2
BERD (percentage of GDP)
0.19
22.9
3
PERD (percentage of GDP)
0.27
21.7
FERD4 (percentage of GDP)
0.11
8.9
Number of researchers (FTE
3 282
- 3.0
R&D personnel (FTE)
5 483
1.2
Innovative active enterprises as
percentageof total enterprises
17.5
n/a
Innovative active enterprises as
percentage of total
turnover of enterprises
42.3
n/a
GERD1
5)
1
Gross expenditure on R&D
2
Business expenditure on R&D
3
Public expenditure on R&D
4
Foreign expenditure on R&D
5
Full-time equivalent
* Data on 2006
46
Avg. yearly
growth rate
(2000–2005)
A small country
playing its part in
meeting global
prosperity challenges
Rapid global development and the huge capital invested into
the resolution of global problems would initially appear to be
the responsibility of the world’s major economic powers, not
of small countries like Latvia. We have understood though,
for some time, that the solution to these problems is knowledge, not capital investment.
Health and the life sciences is another field challenging
mankind, often in more diverse and complex ways than technology and the inorganic world. Cancer causes a quarter of
all deaths in developed countries. Latvian scientists were
amongst the first to make significant discoveries in the field
of anti-cancer drugs as early as 50 years ago. The Latvian
Institute of Organic Synthesis developed the compound ftorafur an anti-metabolite drug used in chemo-therapy. The
entire process of developing this product, starting from its
design and synthesis, through testing and manufacture took
place in Latvia. Today, this preparation is known as the medicinal products Tegafuri and Tegafur, which have been
produced at some of the world’s largest pharmaceutical companies. In Japan, the Taiho company continues to manufacture this preparation, and it has became the most popular
anti-cancer product sold in that country. Latvian pharmaceutical manufacturer Grindex has been exporting this product
for more than 25 years. Altogether, 17 fundamentally new
drugs have been created by the Institute of Organic Synthesis, mainly for the treatment of cancer, cardiovascular and
infectious diseases.
Latvia can be proud of its developments in the field of knowledge both in the past and in the present. These developments have been achieved both independently and by group
collaboration with scientific organisations and technology
development companies in other countries, often solving very
challenging problems. The examples below are given as an
introduction to the evaluation of Latvia’s contribution.
Currently, elite European biotechnology company Cytos
Biotechnology AG of Switzerland, the world’s largest manufacturer of liquid-metal products Ferrotec of the USA, and the
US Energy Department are amongst those who have recognised, valued and continue to utilise the technological knowledge available in Latvia – knowledge capable of developing
new solutions to some of the world’s most acute issues.
Fossil fuels and nuclear fission were the energy sources of the
first two millennia, but will not be main fuels of the third. The
search for new energy sources may be the most important
issue, one concerning every country. One of the most challenging projects in this field is ITER, the first prototype of a
nuclear-fusion energy reactor at Cadarash in France. This type
of reactor poses a wide range of technological problems, each
of which requires the world’s best specialists to solve them.
Latvian scientists from the Institute of Physics, Institute of Solid
State Physics, Institute of Mathematics and the Chemistry Faculty of Riga Technical University are amongst the many working on these solutions. Their particular focus includes the use
of liquid metals and lithium-containing ceramic materials in
equipment, plasma diagnostics, and the calculations of
parameters for high-capacity, high-frequency gyrotrons (high
powered electron tubes which emit a millimetre wave beam
by clustering electrons, inside a strongmagnetic field, with
cyclotron motion).
Technology competence centres –
the key to open innovation
Latvia has a number of fields of scientific endeavour which
can hold their own in world league tables; the capabilities in
these fields are attested to by patents, worldwide publications and the success of Latvian scientists in EU-framework
research and technology development programmes. These
fields include:
• modern materials;
• information technology;
• magneto-hydrodynamics;
• biomedicine;
• pharmaceutical chemistry;
• wood chemistry.
Latvia’s institutional structure for the sciences comprises
11 national scientific institutes, 21 independent scientific
institutes – formally linked to universities, five state-funded
universities, and 15 higher education institutions with their
own scientific structural units.
47
The intensity of international scientific
publication – above the average EU
index, on a par with the USA index.
The most widely known technology competence centres
on the international scale, in terms of having the largest
return on their scientific activity, are the University of
Latvia’s Institute of Solid State Physics and the Latvian
Institute of Organic Synthesis.
Between 1996 and 2002, the scientists of the Institute of
Solid State Physics (ISSP) published 503 scientific papers
(internationally recognised SCI), whereas Institute of
Organic Synthesis scientists authored 342 scientific publications. ISSP’s publication intensity is comparable to the
average publication intensity in the USA which is higher
than the EU average of 639 publications per 1 000 000
inhabitants.
Statistical data on the distribution of Latvian inventions
developed to production, according to their scientific field,
show that the most promising sectors are the pharmaceutical chemistry and gene engineering. The Magneto-hydrodynamics-metallurgical industry can also be considered to be a
strong contender (for example, MHD crystal growth). The
Institute of Organic Synthesis (IOS) and the Biomedical
Research and Study Centre (BMC) of the University of Latvia
are particularly noteworthy in terms of the number of inventions developed and internationally patented. Between 1997
and 2004, IOS scientists were the main authors of 16 pharmaceutical-chemistry patent applications submitted by internationally recognised pharmaceutical companies. Similarly,
BMC scientists were the authors of three international geneengineering patent applications submitted in cooperation
with Cytos Biotechnology Ag (Switzerland), Michigan State
University (USA) and Celltech Pharmacy Ltd. (UK).
Latvia’s most exported
intellectual product
To date, the Institute of Organic Synthesis (IOS) has
developed and introduced 17 original compounds and
more than 60 new drug-manufacturing technologies. IOS
is successfully continuing its work with new patentable
products, as proved by the 70 patents obtained during
the last five years. Furthermore, IOS has sold several
licences, including that for Mildronate® to the publiclylisted Grindex company, and this preparation has
become Latvia’s most exported product.
Contract research at the IOS has already become one of
Latvia’s most important scientific-technical exported
goods/services. Thus in 2003, contract research to a total
value of EUR2 million was carried out, 90% of which was
for EU chemical and pharmaceutical companies.
48
In terms of research infrastructure, Latvia’s globally bestregarded research centres, with their relevant competencies,
are the following:
Institute of Solid State Physics
of the University of Latvia;
• new optical recording environments, including holographic stickers and diffractive elements;
• multifunctional electronic sensors;
• multifunctional segneto-ceramics and the thin
segneto-electric layers for microelectronics, optoelectronics and micro-electromechanical systems (MEMS);
• functional sources of light for the visualisation of
information, including light-emitting and laser diodes;
• instruments with artificial intelligence.
Biomedical Research and Study centre
of the University of Latvia:
• genome analysis;
• determination of DNA structure;
• molecular diagnostics.
University of Latvia:
• lasers and digital-image-visualisation data-processing
systems for obtaining high-quality images of nanostructures and biomedical objects;
• precise measurement of satellite distances with laser
location methods.
Latvian Institute of Organic Synthesis:
• structural research and analysis of bioactive substances.
Riga Technical University:
• Mechanical engineering and transport competence
centre;
• Energy efficiency competence centre;
• Structural materials research competence centre;
• Industrial design.
Dobele Horticultural Plant Breeding
Experimental Station:
• research on storage of fruits and vegetables in UltraLow Oxygen or modified atmosphere storage;
• research on processing of fruits and vegetables;
• quantitative determination of simply separated and
coloured compounds;
• HPLC (high pressure liquid chromatography).
Diverse hi-tech companies
Latvia is the Baltic States leader according
to the Deloitte Technology Fast 500 study.
After Latvia regained independence in 1991, scientists and
the technological developments they brought with them
from various Soviet-era research institutes became the foundation of many successful hi-tech companies. Currently,
Latvia has around 250 hi-tech companies showing sustainable growth trends, mostly concentrated in sectors such as
IT&C, electronics and electrical engineering, equipment manufacture, pharmaceutical chemistry, basic & fine chemistry,
biotechnology and medical technologies.
In the 2006 version of this study, Latvia was the 12th best
performing hi-tech country in Europe. Latvia’s Lursoft IT is
listed among the top 500 hi-tech companies, with an
annual growth rate of 174%.
Lursoft IT operates in the field of information processing &
software development. The company has developed the
SIETS Server search engine software for international customers in the USA, Switzerland, Sweden, UK. Another
product is the Pledge Register, developed for widely
known US consultancy company Booz, Allen and Hamilton.
Additionally, the generally positive attitude of the Latvian private sector towards innovation is very encouraging. On average, since 2002, companies have increased their annual
expenditure on applied research by 37% and for experimental developments by 25%. Also the number of hi-tech companies has increased.
In the same period, the government has developed support
instruments in order to stimulate the creation of more new
technology-based companies (NTBC). As a result, by 2013,
the best 30-150 hi-tech ideas could be supported by way of
these support instruments, enabling them to be implemented within companies or as projects. These factors give confidence to predictions that forecast that the number of hi-tech
companies will even double over the next five years.
Figure 2.
Latvia is an innovation leader in the Baltic Sea
Region service sector
Service sector innovation index from the European
Innovation Scoreboard
0.6
0.5
0.4
Figure 1.
Private-sector R&D spending back on the increase
Internal R&D spending in the private sector by research
type, EUR million.
0.3
0.2
0.1
20
19.1
18
0
16
12
8
4
Applied
research
6.8
6
4.0
5.0
5.6
Experimental
development
2
0
2002
Sweden
10.2
9.8
10
Latvia
Source: European Innovation Scoreboard, 2006.
13.3
14
Estonia Denmark Lithuania Germany Finland
2003
2004
2005
Partnerships and clusters are among the factors facilitating
the competitiveness of Latvian technology companies. In the
Innovating Regions in Europe (IRE) studies, it is reported that,
in the Baltic States, it is Latvia’s clusters which are the most
recognisable internationally1. The government has supported
the development of clusters since 2000, and it is intended to
strengthen and create a total of 8-12 industry clusters by
2013 by further utilisation of this support.
Source: Central Statistical Bureau, 2006.
1
Ketels, K., Örjan, S., Clusters in the EU-10 new member countries.
Europa Innova, also available at
http://www.europe-innova.org/exportedcontent/docs/56/6056/en/Eucluster.pdf
49
Figure 3.
Expenditure on R&D (percentage of GDP) 2001–2013
Forests, 42% of Latvia’s territory,
and timber, 40% of current exports,
are not the future.
2.0%
1.7%
1.4%
Seeking the most appropriate utilisation of Latvia’s “green
gold”, a state-of-the-art R&D base has been developed.
The most significant scientific centre is the Institute of
Wood Chemistry whose activity has historically been very
extensive and shown much promise.
Biolat is one of a number of companies combining scientific potential with business experience and its current market offer includes a series of products with high added
value. Biolat has extensive experience in estimating the
chemical composition of plant materials, especially of tree
foliage, as well as in evaluating the usage potential for
plant extracts. The company offers original products in the
fields of food supplements and additives, plant protection
methods, biological fertilisers, and raw materials for cosmetics and pharmaceuticals. The company also carries out
projects on the complex non-waste processing of plant raw
materials and on the extraction of biologically active herbal
substances using polar and non-polar solvents. The future
promises many more such examples from Biolat and its
peers.
The largest technological clusters have developed in sectors
such as wood processing and the timber industry, and in the
pharmaceutical development and production sector. The
newest and most rapidly growing clusters are those in the
information technology and materials science sectors.
Meeting global R&D challenges
Up to 2006, Latvian technological and innovation results
have been achieved with surprisingly low levels of investment. An outstanding knowledge base and the very effective
use of that limited investment have enabled this barrier to be
overcome and the achievement of remarkable progress in
R&D.
The increased contribution to R&D planned by the government is in line with Latvia’s National Development Plan which
sets the objectives of balanced and sustainable development
for the country, and an increase in its competitiveness
against other countries. The underlying strategic aims of the
plan are improving education and increasing the knowledge
base to facilitate economic growth and technological excellence.
On the basis of these objectives, the public financing allocated to science and development is being increased annually
by 0.15% of GDP, reaching 2% of GDP by 2013.
50
Foreign
Business
0.8%
0.5%
0.2%
0.2%
0.1%
0.1%
2001
2003
0.3%
0.2%
0.1%
2005
0.6%
0.5%
0.3%
0.1%
2007
0.1%
2009
0.1%
0.1%
2011
Public
2013
Note: For foreign expenditure, the forecast is based on a linear trend line, for business expenditure
a linear trend line plus absorbed co-finance from public support, for public the national strategic
framework document for the period 2007–2013. No correction factors are used.
Source: Central Statistical Bureau 2006, LIAA calculations.
In light of the growing role of R&D in the national economy’s
development, the government has opened the door to a substantial breakthrough in this sector. In addition to the direct
national financing envisaged in the financial support measures developed for 2007-2013, around EUR 860 million will
be available for the development of innovations, of which
about EUR 600 million would be the public contribution to
R&D as such.
Contribution of EUR 860 million to
innovation through the National strategic
framework document & Operational
programmes for the period 2007–2013.
This component of state, EU and private financing, in addition to the increase of the financing from the state budget
will significantly boost R&D expenditure for the period
2007-2013. The forecast distribution among innovation
system priorities is as follows: 65% - research excellence,
24% - innovation demand, 9% - linkages, and 2% - mobility.
The facilitation of innovation will be further ensured by two
operational programmes, Business & Innovation (EUR 744
million) and Human Resources & Employment (EUR 457 million). The total amount of those programmes allocated to
innovation will be an investment of EUR 860 million, of
which 70% is from state and EU support and 30% is from
business financing.
Compared to 2006, the annual public contribution to R&D
will almost be quadrupled in the period 2007–2013. At the
same time, the sector will continue to attract an average
annual contribution of EUR 23 million from the private sector. Such a rate of investment would represent a contribution
to R&D of at least 2.64% of gross domestic product in 2013.
Such an initiative from the government will provide a significant boost and comprehensively improve the innovation
environment, both increasing its capacity and creating the
pre-conditions for future investment in R&D by the private
sector. Having evaluated specific investment measures and
their results, it can be promised that Latvian technological
supply and the availability of knowledge will become more
diverse and even more attractive to foreign partners.
Figure 4.
Gross R&D expenditure (percentage of GDP)
2001–2013
3.00%
2.50%
Along with the development of knowledge there has been
an increase in the significance of Latvia’s activities on an
international scale. The traditionally close links between Latvian researchers and the R&D sectors of CIS States have
expanded significantly since Latvia acceded to the EU,
because of the country’s integration into the common space
of the Baltic Sea Region States and the EU. Since 1999, Latvia
has been successfully involved in EU Framework programmes, and up to 2007, the number of project applications in which Latvian researchers have become partners in
Framework 5 and 6 programmes has reached 2000. Latvia’s
successful participation is also demonstrated by its very high
comparative indicators both among central and eastern
European States and the old EU States. For example, Latvia is
one of the most flourishing states in terms of success rate
having leapfrogged Baltic Sea Region countries such as Finland and Sweden in the international competitiveness stakes.
2.6%
US: 2.7 (2004)
2.3%
2.0%
2.00%
1.9%
EU-15: 1.9 (2004)
1.7%
1.50%
1.5%
0.6%
0.50%
0.00%
Optimistic
trend
1.2%
1.00%
0.4%
0.4%
2001
2003
Real
expected
trend
2005
2007
2009
2011
2013
Source: Central Statistical Bureau 2006, LIAA calculations.
The existing knowledge base, excellent growth indicators,
international cooperation and strategic and innovationbased economic management enable Latvia to be considered
one of the most promising technology centres in the EU and
the Baltic Sea Region. We believe that our knowledge will
contribute to global welfare and many people will benefit
from it.
51
Acknowledgements
Greatful acknowledgement is made for the generous giving of time
and of expertise by professionals without whom this publication
could not have come into being:
Dr Valdis Avotiñß – for the original idea and the content presented in the Catalogue
Mr Viesturs Zeps and Ms Evita Medne – for the coordination and
management of project activities
Mr Juris O.Beñ˚is – for contribution to the gathering of information and turning it into stories to be learned from
Mr Ojårs Gri˚is – for photographs of companies, technologies and
products
Mr Uldis Maniks – for elaboration of the Technology profile outlining Latvia’s competitiveness milestones
Mr Egîls Pårups – for design and layout
52
Perses iela 2, Riga, Latvia LV -1442
Phone:
+371 67039499
Fax:
+371 67039401
E-mail:
[email protected]
www.liaa.gov.lv
www.exim.lv
Representative Offices
of Investment and Development Agency of Latvia
Representative Office in the United Kingdom
Representative Office in the Russian Federation
72 Queensborough Terrace,
London, W2 3SH
United Kingdom
Phone:
+44 (0) 20 7229 8173
Fax:
+44 (0) 20 7727 7397
Mob:
+44 799 0605422
E-mail:
[email protected]
Ul. Chapligina 3, 103062 Moscow
Russian Federation
Phone / Fax: +(7 495) 7301834
Mob:
+(7 495) 926 6653080
E-mail:
[email protected]
Representative Office in Germany
Investitions- und Wirtschaftsförderung Lettland
Große Bleichen 21, Galleria, Aufgang AB, 20354, Hamburg
Germany
Phone:
+49 (0) 40 68 99 5007
Fax:
+49 (0) 40 68 99 5009
Mob:
+49 162 9811 075
E-mail:
[email protected]
Representative Office in France
Bureau de représentation en France
Ambassade de Lettonie
6, villa Saïd 75116 Paris
France
Phone:
+33 1 53 64 5815
Fax:
+33 1 53 64 5819
Mob:
+33 617 724 246
E-mail:
[email protected]
Representative Office in Sweden
Odengatan 5, Box 19167,
10432 Stockholm
Sweden
Phone:
+46 8 7006311
Fax:
+46 8 140 151
Mob:
+46 704956849
E-mail:
[email protected]
Representative Office in the Netherlands
De Ruyterkade 5, 4th floor
1013 AA Amsterdam
The Netherlands
Phone:
+31 (0) 20 420 3041
Fax:
+31 (0) 20 420 3042
Mob:
+31 (0) 646 225 676
E-mail:
[email protected]
Representative Office in Kazakhstan
Perses iela 2, Riga
Latvia LV-1442
Phone:
+371 67039499
Fax:
+371 67039401
Mob:
+371 29383557
E-mail:
[email protected]
Representative Office in Norway
Henrik Ibsens gate 100, PB 2946,
0230 Solli, Oslo
Norway
Phone:
+47 22 04 98 00
Fax:
+47 22 04 98 01
Mob:
+47 47 28 80 25
E-mail:
[email protected]
Representative Office in Denmark
Embassy of the Republic of Latvia
Rosbæksvej 17, DK-2100,
Copenhagen Ø
Denmark
Phone:
+45 39276009
Fax:
+45 39276173
Mob:
+45 26283528
E-mail:
[email protected]
Representative Office in USA
1776 K Street NW, Suite 814
Washington, D.C. 20006
USA
Phone:
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E-mail:
[email protected]

High tech darbs web

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