Latvia’s largest business association, the Latvian Chamber of Commerce and Industry (LCCI) reports that Eurochambres, the Association of European Chambers of Commerce and Industry, has published the results of its annual economic survey, which clearly signals that reforms are needed for business growth at both the national and European levels.

Eurochambres’ annual economic survey, in which 41,090 companies from 28 European countries participated, reveals that entrepreneurs are striving to return to growth after several challenging years. Whether this potential can be realized and the European economy can return to a phase of growth will depend on the determination of the European Union (EU) and national governments to address labor issues, reduce bureaucratic burdens, and lower barriers to participation in the European single market.

Survey data from European business organizations show a slight improvement in most key economic indicators – business confidence is growing, as are national and export sales forecasts for 2026, although they still lag behind pre-pandemic levels. The improvements are mainly due to lower inflation, lower consumer prices, and relatively higher demand at the national level than last year. However, challenges – high labor costs, complex and burdensome EU bureaucracy, and geopolitical uncertainty – will continue to hamper growth.

Katrīna Zariņa, member of the LCCI Board, comments: “Entrepreneurs’ forecasts for the coming year are positive both for the local market and export markets, but at the same time there are still justified concerns about the overall business environment in Latvia. In this category, Latvian entrepreneurs are pessimistic in their forecasts for the coming year.

At the same time, the assessment of the European economic engines, France and Germany, must be taken into account, as the economic situation in these countries often influences the situation in other European countries, including Latvia. The survey results show that French companies in particular are forecasting a worse situation in their local market, while German companies’ forecasts for their situation in export markets in 2026 are negative.

When asked about the most significant challenges in 2026, Latvian entrepreneurs unsurprisingly pointed to labor costs and the high bureaucratic burden. These same challenges have been identified as the most significant for the coming year by companies across Europe, indicating that policymakers at the national and European levels must work together to ensure that promoting European competitiveness does not remain merely a slogan.

Eurochambres points out that targeted policy reforms in several areas are needed to fully exploit the potential of European businesses. First, a predictable business environment and financial support must be ensured. At the same time, it is essential to promote digital transformation and reduce bureaucracy, in particular by easing regulations for small and medium-sized enterprises (SMEs). This would enable businesses to make more effective use of digital infrastructure, optimize resources, and invest in growth. For the European single market to function properly, its fragmentation must be reduced. The development of competitiveness and skills is also important. This requires increased investment in vocational and adult education. In the context of the green transition, it is essential to ensure that clean energy solutions are accessible and economically viable. Europe’s global competitiveness will be strengthened by a more open and dynamic trade policy, promoting the export capacity of SMEs and concluding new, mutually beneficial trade agreements with partners around the world.

Eurochambres, the Association of European Chambers of Commerce and Industry, represents more than 20 million businesses employing over 120 million people. The annual economic survey of European chambers of commerce and industry was conducted for the 33rd time.