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POTENCIAL INVESTMENT PROJECT FOR INNOVATIVE PRODUCT MANUFACTURING FROM BALTIC SEA SPRATS
Abstract
The added value generated by the fisheries sector in 2017 was only 0.15% of the total value added in Latvia, in the meantime its significance in external trade was higher, as the sector accounted for 1.8% of the total value of export production (EUR 206 million). The export capacity of the fishing sub-sector is mostly determined by the development of the fish processing sub-sector. Canned fish form 35% of the Latvian exports but this product group faces challenges of product and market reorientation due to decreased consumer buying power and trade restrictions in some former key Latvian canned fish export markets. It is possible, however, to solve the market reorientation issues and increase exports by creating new, innovative processed fish products and manufacturing them on an industrial scale, as fishing volumes are limited and subject to the European Union (EU) Common Fisheries Policy (CFP) establishing catch quotas. It is particularly important to create new innovative products from Baltic Sea sprats (Sprattus sprattus balticus), as their catch in 2017 accounted for 53% of the total catch in the Baltic Sea and the Gulf of Riga. Therefore, the aim of the research is to carry out an economic assessment of the factory investment project potential for manufacturing new innovative structured fish forcemeat products from sprats captured in the Baltic Sea. The optimistic scenario envisages processing about 13% of Baltic Sea sprats, which were exported from Latvia in 2017, or 3736 tons, which would be possible to successfully sell in large foreign markets. Research and calculations were carried out to estimate the necessary investments in the factory establishment. The research established the main investment economic and financial performance indicators, the required number of employees and the effects of establishing the fish-processing factory on the national economy of Latvia.
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