Scholarly record

COMPARATIVE ANALYSIS OF INVESTMENT ENVIRONMENT IN THE BALTIC STATES

Aija Pilvere

Abstract

Investment environment is crucial for countries to attract investors and for economic growth. Baltic States regained independence in early 90-ties, their sizes are comparable and after almost 30 years as independent countries, it is substantial to judge their investment environment and lessons to learn from each other to ensure long-term sustainable development. The paper analyzes and compares investment environment among three Baltic States. The aim of the paper is to determine current investment environment of the Baltic States and perform comparative analysis from 2010 as a post-recession period to 2020 forecasted period. Authors analyzed key macroeconomic indicators and their trends using heatmaps, which show different development pattern for Baltic States, where Lithuania is showing signs of lowest growth rate in 2018-2020E, compared to Estonia and Latvia. On the contrary based on the global rankings in 2018, Lithuania is leading in terms of investment environment indicators. As the place where investors can most easily invest in the economy, via stock market listed companies, their previous trend using regression analysis shows that the most impact of Gross Domestic Product (GDP) change is observed in Estonia on listed companies price index. Analysis can serve as an important tool to investment environment creators ? government authorities, as well as investors and scientists.

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