Euro changeover in Latvia
-
Upload
finansu-ministrija -
Category
Economy & Finance
-
view
113 -
download
3
description
Transcript of Euro changeover in Latvia
Euro changeover
in Latvia
Rīga, August 2014
The content
1. Macroeconomical background
2. Technical preparation, including euro communication
3. Changeover conclusions
Macroeconomical background
Latvia – one of the hardest hit countries in the economic crisis of 2009
Euro target – crisis exit strategy
2008Agreement on the International Loan
Programme
2011Completion of the International Loan
Programme
Correction of economicimbalances
Support from domestic and international community
Fall in external demand
Restoredfiscal viability
Return of economic growth in 2010
Credit rating upgrade
Socialprotectionmeasures forthe mostvulnerable
Fiscal consolidation and structural reforms underpin competitiveness
21% contraction of GDP, frontloaded fiscaladjustment 17% of GDP
Impact of the crisis
Internal devaluation
Outcome of the crisis
Access to financial markets closed
Return to financial markets
EURO – key driving force for change
• EURO = crisis exit strategy
• EURO = key driving force:
› to put Latvian economy on solid ground › to implement structural reforms
Property boom led Latvia to crisis starting 2008, while now the growth is based on a healthy economic foundation and fiscal discipline.
In the third quarter 2013 economic growth in Latvia still was the fastest in the EU
Data: Eurostat
GDP growth flash estimate in Q3 2013, % (seasonally adjusted data )
-5,3
-3,0
-1,6
-1,0-0,7 -0,6 -0,6 -0,4
0,4 0,5 0,5 0,5 0,6 0,7 0,7 0,9 1,1 1,11,5
1,8 1,9 2,0 2,2
4,14,5
-6
-4
-2
0
2
4
6C
ypru
s
Gre
ece
Italy
Fin
land
Sp
ain
Cro
atia
Neth
erl
an
ds
Czech
Rep
.
Be
lgiu
m
Au
str
ia
Den
ma
rk
Fra
nce
Slo
ve
nia
Esto
nia
Sw
ed
en
Slo
va
kia
Ge
rma
ny
UK
Bu
lga
ria
Hun
ga
ry
Ma
lta
Po
lan
d
Lith
uan
ia
Ro
ma
nia
Latv
ia
Core inflation has remained low for an extended period of time
Consumer Price Index (CPI), annual growth, contributions, %
Data source: CSB
Unemployment keeps declining and is now below the Eurozone average
Registered unemployment & job seeker rate, %
Data source: CSB, State Employment Agency
Latvia's credit ratings have been upgraded and currently have positive outlooks
Latvia’s sovereign rating on long-term foreign currency debt
Fiscal targets have been constantly outperformed and we are committed to achieve more...
Fiscal Targets and Results
-9,8
-8,1
-3,6
-1,2
-10,0
-8,5
-6,0
-3,0
-1,9
-1,1
-4,5
-2,5-1,9
-1,4
-0,8-0,3
-1,6
-0,9 -0,9 -0,8
-10
-9
-8
-7
-6
-5
-4
-3
-2
-1
0
2009 2010 2011 2012 2013 2014 2015 2016
% o
f G
DP
Actual
Initial target 2009
Target 2011
Target 2012
Target 2013
2014Joining
Eurozone
- 3%- 3%
Latvia in the euro area – what can be expected from the new member?
a silent partner?
focused exclusively on its short term gains/loses?
indifferent to common problems ?
no
cold to acts of solidarity? no
strong advocate to respect adopted rules?
yes
believers to fiscal discipline? yes
ally towards closer integration in EMU? yes
no
no
The euro is not a “magic wand” for all economic difficulties, but an instrument which can be used to contribute to the
growth of economic potential.
Technical preparation, including euro communication
Euro Coordination Council
Steering Committee
Euro Bureau
StateAdministrationWorking Group
Money and Payment Systems
Working Group
FinancialSystem
Working Group
Non-financial Corporation
and Consumer Working Group
Public Awareness and
Communication Working Group
National law and
IT systems
Cash and non-cash
changeover
Financial andcapital
markets
Fare pricedisplay
Informing andeducating
T A S K S
Established in 2005 to coordinate the process of the introduction of
the euro
Media
Merchants: cash registers,
price display, etc.Communica-tors
Banks
Inhabitants:librarians,
info centersAccountingand taxes
Risksassessment
Professional expert grouping
IT registry
Municipalities
Latvia's National Euro Changeover Plan and regular progress reports
- In total the Cabinet of Ministers has approved 25 regular progress reports and on 18 June 2014 there was held the final (the 44th) meeting of the Steering Committee.
- Both the Plan and progress reports are publicly available at the eiro.lv. The Plan is available in Latvian, English and Russian languages.
The Latvia's National Euro Changeover Plan was drafted in 2005, and its first edition was approved on 26 March 2006.
Until April 2013 the Plan has been updated five times
The main stages18.07.2005-01.01.2012
01.01.2012-09.07.2013
09.07.2013-09.12.2013
09.12.2013-14.01.2014
Final stage
SUPERVISIONINTENSIVE
SUPERVISIONSUPERVISION
- Planning- Euro paymentsystems- Price monitoring (06.2006-09.2008)- Developed eiro.lv- Established the communication strategy
- National law adjustment concept and the Euro Law- Seminars- Establishing cooperation network with NGOs and municipalities- IT systems- Cost estimates
- Intensive communication stage- Initiative «Fair euro introducer»- Cash logistics- IT testing phase and development of technical infrastructure
- Starter kits andsub-frontloading- New Year's night transition period: ATM, POS, cash registers and cash systems, internetbanking, IT systems
- Final public survey- Until 30.06.2014 euro info line services- Until the end of 2014 price monitoring continues- Accounting and re-denomination of equity capital stockissues
Cash changeover
Cash changeover map:- Geographic proximity*: all banks,
in regions – 302 post offices- Security- Effectiveness and cost efficiency
* In places, where is no changover point, average distance to the nearest changover point is 10 km
Cash changeover:- Until 31 March at 302 post offices- Until 30 June in all commercial banks- Unlimited time period at the Bank of
Latvia
Security
– Security action plan was developed already in 2012.
– Plan provides the measures enhancing the safety of inhabitants,retailers and cash transport by Cash-in-transit sector duringchangeover period.
– The capacity of the State police has been substantiallystrengthen.
Action plan for bad weather conditions– Signed cooperation agreement with the Latvian State Roads – special road maintenance at the request of the State police Operational Command center
– Development of tactic in case of evacuation need of transported cash (as example – use of State Border Guard helicopter)
Euro introduction costs
• Article 5 Euro Law on the Procedure for the Introduction of Euro and one of core principles of the euro introduction –
• All agents shall have the responsibility for the euro implementation costs, while the government budget shall have the responsibility for the costs of the institutions financed from the state budget.
Public sector costs
12.5 million euro in total –• 5.5 – IT systems• 2.2 – cash changeover at post offices in rural areas • 1.7 – communication campaign• 2.3 – additional security costs• 0.5 – price monitoring and other activities related to non-financial sector• 0.2 – strengthen capacity for legal acts adjustments
Public sector costs
• More than 90% of IT costs are financed by the European Regional Development Fund;
• 50% of communication costs are co-financed by the European Commission.
Total euro introduction costs
• According to the research from the National Central Bank of Slovakia there are average euro introduction costs from 0.3 up to 0.8% from the GDP (March 2006)
• According to the research from the Bank of Latvia the total cost of the euro introduction in Latvia might be assessed among 110-219 million EUR (September 2012)
Technical preparation: State administration working group
Structure of the State Administration Working Group
Chairman: Ms Arina AndreičikaMinistry of Finance
Head of the Euro Bureau
Accounting sub-groupleads by the MoF
Statistics sub-groupLeads by the CSB
IT ad hoc sub-groupleads by the ICT line ministry in
cooperation with E&Y Baltic
Members:Representatives from all ministries, the Bank of Latvia, Latvian Post, Latvian
association of local and regional governments and the Treasury
The main aims and tasks
- Adjustment of national law related to the introduction of the euro
- Adjustment of statistics, accounting and other state information systems for the introduction of the euro
- Development of practical guidelines for companies regarding accounting, tax issues, cash registers, statistics, post stamps, gift cards, etc.
- Monitoring and assisting local governments transition to the euro
The Law on the Procedure for Introducing the Euro
- Has been drafted in coordination with the ECB
- Establishes clear legal framework
- Outlines basic principles for the transition of cash and non cash transactions and revaluations, including, but not limited to: the parallel circulation period of lats and euro, dual price display, accounting, tax payments and credit record treatment, financial market treatments, and enforcement
The preparatory works monitoring at the municipal level
- Legal acts adjustment until 1 December 2013
- IT systems adjustment time planning in accordance with the Changeover Plan
- Municipal companies' IT readiness, application to «Fair Euro Introducer» and equity capital stock redenomination
- Regional seminars
The main stages
18.07.2005-01.01.2012
01.01.2012-31.01.2013
31.01.2013-09.12.2013
09.12.2013-14.01.2014
Final stage
- Planning- Drafting the list of IT systems and cost assessment
- Drafting the Law on the Procedure for Introduction of the Euro - Development of practical guidelines
- Adjusting national law- Adjusting IT systems- Localgovernmentmonitoring
- Detailed daily supervision of IT systems and cash registers of the different merchant areas
- Accounting and redenomination of equity capital stock issues
- Professional seminars have been organised in Riga and regions
The main accomplishments
Adjustment of national law. In cooperation with the Ministry of Justice, State Chancellery and the Ministry of Environmental Protection and Regional Development (MEPRD)
- 113 laws- 603 rules of the Cabinet of Ministers- 1504 local government binding rules
Adjustment of IT systems. In cooperation with MEPRD and E&Y Baltic- 106 state IT systems- 463 local government IT systems- Particular cooperation with IT developers – FMS, ZZ Dats and Exigen Services Latvia
Money and Payment System Working Group
A. Ruselis
Head of MPSWG
Vice president of the Bank of Latvia
Money and Payment System Working
Group (MPSWG) structure
MPSWG
leads by the vice president of the Bank of Latvia
Security sub-group
leads by the Ministry of
Interior
Frontloading and Sub-
frontloading sub-group
leads by the Bank of Latvia
SEPA sub-group
leads by the Bank of Latvia
65 working group and sub-group meetings since establishment
of MPSWG (in 2005)
MPSWG members:
Bank of Latvia, the Ministry of Transport, Latvian Post, the Ministry of Interior,
The Treasury, Central Depository, the Association of Commercial Banks of Latvia
MPSWG main activities
• Issues of the introduction of the euro cash and non-cash payments Logistics of the euro coins and banknotes
Management of the euro frontloading and sub-frontloading
Adjustment of the payment systems to the euro
Withdrawal of lats from the circulation
Management of the security activities regarding the introduction of the euro
Risk management
• Participation in the euro communication activities Participation in seminars and other communication activitities regarding the euro
• Participation in developing legislative framework Proposals to improve the process of the introduction of euro
Close cooperation with other Steering Committee working groups
• Other activities in terms of MPSWG competence
The main stages
Management of
the euro
frontloading and
sub-frontloading
Logistics of the
euro coins and
banknotes
Euro
sub-frontloading
to retail chains
Detailed supervision
regarding
adjustments in
payment systems
01.01.2006 -
01.12.2013
01.01.2012 -
31.12.2013
01.08. 2013 -
31.12.201309.12.2013 -
14.01.2014
01.01.2013 -
31.12.2013
Adjustmement
of ATM and
other devices
01.11.2004 – 31.12.2013
Activities regarding large value payment systems, ACH, direct debit and cards infrastructure
adjustments to the euro.
Readiness to participate in Target2 since 11.2007.
Detailed supervision over
the euro payment introduction
• Drafting and managing MPSWG detailed plan
covered time period from 9 December 2013 until 14 January 2014
more than 500 activities
Involves the Bank of Latvia, the Treasury, Latvian Post, 22 banks, other participants
of the payment system and the State Police
• Comprehensive and early communication with all institutions involved in MPSWG
and in the Euro project
• Early response and identification of the problems
Preparations for the cash changeover
• 400 million euro coins bearing Latvian national sides and 110 million
euro banknotes of various denominations were required for the
changeover.
• The delivery started in July 2013 and the final batch will be delivered in
March 2014.
• Frontloading to the credit institutions started on 1 November and sub-
frontloading to the non-financial sector – on 10 December.
Starter kit for general public
• Available to general
public via all commercial
banks, 302 post offices
and Bank of Latvia as
from 10 December 2013
• Value – 10 LVL (14.23
EUR)
• Prepared 800 thousand
pieces; were sold till 31
December – 644
thousand pieces
Starter kit for business
• Available as from 10
December up to 28
Decembers 2013
• Value – 140.56 LVL (200
EUR)
• Some banks and CIT
companies formed their own
starter kits
• Sold 70 000 pieces
Interbank payments
02.01.2014
until 08.45*
Card payments
Without interruption
I-bank and
on-us payments
01.01.2014
until 12:00
Main MSPWG objective – to ensure fast
recovery of financial services
ATM
01.01.2014
until 01.00*
* Maximum time of interruption in the most important banks, in terms of amount of customers
FINANCIAL SYSTEM
WORKING GROUP
Pēters Putniņš,
Deputy Chairman of the Financial and Capital
Market Commission (FCMC),
Head of the Financial System Working Group
o
o
o
o
LATVIJAS REPUBLIKAS
EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
Non-financial Corporation and Consumer Working Group'seuro introduction activities
Zaiga Liepiņa, Deputy State secretary of the Ministry of
Economics
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 51
NCCWG members and competence
Employers' Confederation of Latvia , Latvian Chamber of Commerce and Industry, Latvian Food retailers association, Latvian Traders Association, Latvian Fuel Traders Association,
Consumer Rights Protection Centre, Latvian National Association for Consumer Protection, Investment and Development Agency of Latvia, Competition Council, Ministry of
Environmental Protection and Regional Development, Bank of Latvia
Ministry of Economics
Competence:
Price monitoring
Goods, services price display control
Initiative «Fair euro introducer»
Professional seminars for entrepreneurs
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 52
For a first time from June 2006 to September 2008
From January 2013 to December 2014
120 goods and services
More than 400 retail un service spots in whole Latvia
In one day
From October to March – 4 times a month
Information www.em.gov.lv
Price monitoring
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 53
On average in whole observational period 4,52% of prices have
increased, but 4,9 % of prices have decreased
On average 90,43% of prices have stayed the same
Price fluctuation mainly can be explained with seasonality, and raw
material price increase
Bank of Latvia, Ministry of Economics, Consumer Rights Protection
Centre (CRPC) and Competition Council are following these results
Main observations from price monitoring:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 54
Results of price monitoring
(mothly - March to September 2013)
86% 90,5% 85% 86% 83,3% 86,92% 85%
6%4,5%
6% 8% 9,3% 4,51% 9%8% 5% 9% 6% 7,4% 8,57% 6%
0%
20%
40%
60%
80%
100%
120%
March April May June July August September
Price
decresed
Price
increased
Fixed price
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 55
Results of price monitoring
(weekly from October 2013 till January 2014)
83%
93,53%
95% 97%83,23%
95,19%
95,37%95,30%
95,80%
95,80%
95,90%96,20%
91,20%
95,50%92,70%
7%2,51%
2% 0,80%7,34%
1,71%2,53%
3,00%
2,40%2,80%
2,00%
2,20%
3,80%
2,10%
3,60%
9%4,06% 3% 2,20%
9,43%3,10%2,10%1,70%1,80% 1,40%2,10% 1,60%
5,00%2,40%3,70%
0%
20%
40%
60%
80%
100%
120%
Oct.01 Oct.02 Oct.03 Oct.04 Nov.01 Nov.02 Nov.03 Nov.04 Dec.01 Dec.02 Dec.03 Dec.04 Jan.01 Jan.02 Jan.03
Price decreased Price inreased Fixed price
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 56
Inspections are carried out by:
CRPC inspectors(15 000 inspections)
Latvian National Association for Consumer
Protection (signed cooperation
agreement, 13 000 inspections)
In addition to daily duties:
Food and Veterinary Service inspectors
State Revenue Service inspectors
Price display control
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 57
10 787 inspections and 3306 violations dedected (33%)
Most common violations – prices are not displayed in both currencies,
incorrect convertion
Out of 3131 cases in 2405 cases or in 77% of overall cases violations are
corrected:
46% already during inspection
31% entrepreneurs submited proof that violations are corrected
Results (on 01.12.2013.):
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA 58
CRPC initiated 22 cases in accordence with Administrative
Violations Code (AVC)
7 AVC decisions to impose penalty
3 AVC cases closed with verbal admonishment
List with punished enterprises available at CRPC home page
Administrative cases:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
59
The BUSINESS initiative
«FAIR EURO INTRODUCER»
Time: July 2013 - June 2014
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
60
Goals and principles of Memorandum
Timeline and preparatory work
Application for Memorandum
Promoting of participation and other supporting activities
Practical recommendations
Content:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
61
Goal:
Honest and transparent implementation of the
euro in Latvia
Protection against unjustified price increase as
a result of the introduction of the euro
Including business as proactive and equal
partners in strengthening consumer confidence
Target number – 5 000 merchants or 30 000
points of sale
Message:
Joining “Fair euro introducer” = confirmation of
fair and responsible business practice
GOAL & MESSAGE:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
62
1. do not use the introduction of the euro for price
increase;
2. indicate clear prices in lats and in euros;
3. provide fair recalculation of prices from lats to euros;
4. facilitate participation in Memorandum of partners,
suppliers and customers;
5. train and inform employees on matters related to
introduction of euro.
Memorandum – 5 principles
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
63
Timeline 2013
Mar-Apr May June July Aug Sept Oct Nov DecBest practice study
(experience of Estonia, Slovakia)
1.-7.07. public
consultations and
amendments to
Memorandum
From 5.08.
– sending
out
invitation
letters to
business
9.09-13.10. advertising
campaign for business
1.03. - starts
tender for public
procurement
24.05. signing
of public
procurement
contract
6.06. first draft
of
Memorandum
12.07. final
memorandum
published,
ceremony of
signing of the
Memorandum
3.10.-18.10.
advertising
campaign
for
consumers
(TV&radio
spots)
Negotiations
with NGOs,
preparations
for the official
ceremony
17.07. start of the
Memorandum
signing process
through webpage
12.07.2013.-30.06.2014. – administration of applications, euro seminars (~700
participants), regular press releases on amount of subscribers, maintenance of
webpage, supervision, reminders for business
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
64
Memorandum – preparation and public discussions with NGO’s
Legal support – sworn advocate Jānis Jurkāns (“Cers
un Jurkāns”)
Partners - 8 business associations and organisations: Latvian Chamber of Commerce and Industry
Employer`s Confederation of Latvia
Association of Commercial Banks of Latvia
Latvian Retailers association
Latvian Leasing Providers Association
Latvian Agricultural Cooperatives Association
Latvian Food retailers association
Latvian Fuel Traders Association
Cooperation with “Latvijas Pasts” un “Lursoft”
Preparation of Memorandum
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
65
12th July 2013, with participation of high state officials and popular
entrepreneurs:
Prime minister Mr. V.Dombrovskis
Minister of Economics Mr. D.Pavļuts
Minister of Finance Mr. A.Vilks
8 business associations
~ 50 entrepreneurs received
first stickers
Huge interest of mass media
Participation at ceremony
Press conference and press release
Letter of gratitude signed by Minister of Economics and photo for
each participant.
Ceremony of signing:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
66
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
67
The most convenient for every company:
Electronic applications - www.godigs.lv ;
Possibility to fill in application at offices of partner NGOs in biggest
cities of Latvia and Ministry of Economics => paper application;
Possibility to sign Memorandum and fill in application during
regional seminars and special events;
Application form can be sent by email;
Application form can be sent by post.
Application for Memorandum
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
68
Authentication system:
Electronic signature, electronic ID or bank account verification –automatic verification if the company is registered and if the person filling application has official signature rights in name of company;
Instructions to the user
Downloadable entry form
Affirmation of participation after application is completed (can be downloaded or printed and used for representative purposes);
Most popular application form - 75% of applications received electronically.
Electronic application:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
69
List of participants of Memorandum available publicly on project web page;
Stickers with official logo for businesses (free of charge) – by post (Latvijas Pasts), at Ministry of
Economics, offices of partner organizations (number of stickers according to number of points of sale);
Banners and other visual materials to be used online, in cashier receipts, product packaging, stamps etc.;
All other initiative-related information on official web-site www.godigs.lv
Recognition of participants
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
70
Personal invitations to companies and NGOs:
~ 30 000 paper letters sent by post (Latvijas Pasts)
~ 7000 e-mail invitations (Lursoft)
~ invitations for 60 business organisations and associations
Regional seminars (5 regional Eurodays, seminars organised by MoF, MoEand Bank of Latvia);
Information to 350 delegates of congress of Latvian Association of Local and Regional Governments
Regular presentations for industry associations (especially agriculture)
Special invitations for enterprises with state owned shares;
Advertising of initiative in Post subscription catalogue (300 000 copies);
Media campaign for consumers (TV and radio spots) and companies (internet, press).
Promoting participation in the initiative
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
Regional informative seminars
5 cities – as part of informative
event “EURO DAY”
Close cooperation with partner organisations to invite businesses
Cooperation with municipalities
Meeting/discussion with high
level state officials
Sharing business experience
Macroeconomic insight
Management of change and reputation
Practical advice and guidelines
for euro changeover
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
72
Co-ordinated by Ministry of Finance
Part 1. Target audience: business that supplies goods or services to consumers directly or indirectly. September 2013 – October 2013 (print)
Part 2. Target audience: consumers – informing about the campaign and its’ identification signs and encouraging consumers to shop at merchants who have joined the memorandum. 2 September – 13 December (print, TV)
Advertising campaign
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
73
http://www.youtube.com/watch?v=qeKssaEG77U
Video:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
74
Media relations
Standpoint articles of entrepreneurs and business associations in central
and regional media
Interviews with participants of initiative in central and regional media
Press releases at least once a week (statistics, joined industries, views of
entrepreneurs, motivation to participate)
Materials for distribution
Posters (Latvijas Pasts, supermarket chains, municipality information
centres, business incubators, etc.)
Brochure (regional seminars, municipalities)
Visual materials
Video with explanation and advice on using the initiative for improving
business reputation
Promoting participation in initiative – other supporting activities:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
75
Media attitude – mostly positive/neutral
Communication by businesses – partners, employees, media
Media interest regarding businesses who have joined the Memorandum, especially in regions
More than 160 publications about initiative «Fair Euro Introducer» (until 7th January 2014).
Publicity of initiative:
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
76
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
77
1 224 companies, more than 11 000 points of sale
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
78
5 biggest retail chains
84 % of banking sector
Providers of public utilities
Health service providers and pharmacies
Important fuel retailers
Private persons – performers of
commercial activity
The Association of Hotels and
Restaurants of Latvia (~250 enterprises)
Members
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
79
What to take into account?
The public attitude towards euro (confidence in politics, government, political and economic situation in the country, trust in business ethics and fairness)
The media attitude towards the euro
The host organizations and professional associations attitude to the subject (it should be formulated in advance);
The usual activity (or inactivity) of business participating in self-regulatory activities
Practical recommendations (1):
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
80
How to organise?
Support and participation from business organisations from very
beginning
Set up high goals for number of participants and the target
audience
Keep all activities in one organisation – practical implementation, advertising, communication, etc.
Ensure high level of coordination of activities
PR support crucial to make fair pricing agreement well known and popular
Easy and convenient ways for companies to sign the agreement
Think on ways how to make signing of agreement alluring for
businesses (reputation, «free advertising», special newsletters on euro from government institutions, etc.).
Practical recommendations (2):
LATVIJAS REPUBLIKAS EKONOMIKAS MINISTRIJAMINISTRY OF ECONOMICS OF THE REPUBLIC OF LATVIA
Technical preparation: Public awareness and communication working group
Communication WG (established in 2005)
- In year 2008 established the web page www.eiro.lv- In year 2010 with colleagues from Belgium's MoF and Central Bank PACWG participates in
twinning project, where initial Communication Strategy for the Euro Changeover in Latviawas drafted. The Strategy covers communication messages, focus gropus and three stages are defined:
From January 2012 to July 2013 – preparation stageFrom July 2013 to January 2014 – intensive stageFrom January 2014 to december 2014 – final stage
Communication professionals from all ministries, Parliament, FCMC, Bank of Latvia, Latvian Institute, CRPC, Latvian Post, Latvian Tourism Development Agency, etc.
Two sub-groups: for organising regional forums and for work with international media
Goals:
• 90% of Latvians feel informed enough for the practical aspects of the implementation of euro
• 60% of Latvians support the implementation of euro
90/60
Target audiences
• Households – socially and economically active
• Tourists
• Children and students
Socially vulnerable groups
• Retirees
• People with special needs
• People hard to reach
• Prisoners
• Ethnic minorities
• Unemployed persons
• Municipalities, the government
• Librarians
• The employees of the Latvian Post
• Bankers
• Entrepreneurs and their employees
• NGO
Public and private sector
General audience
A language that everyone understands
All over thecountry
Easy to understand
Cost-effective
- Focus on regions- People living outside urban areas- PrisonersEtc.
- Mass media- Direct mail to hoseholds- Places where people are dealing with money: banks, stores, markets etc.- The basic necessities- Partners
- Informative materal for visually impaired individuals- Brochure for retirees- Informative material for socially vulnerable individuals- Brochure for tourists – in Englishu.c.
Common message:
EURO. LATVIA GROWS.
Communication:
360°• Media relations and events
• Mass media
• Social media
• Seminars and discussions
• www.eiro.lv
• Opinion leaders
• Information multipliers
Support from European Commision:
360°• Partnership agreement
• Communication with vulnerable groups
• Exhibition
Direct mail to householdsRegionaly adjusted + RUS version
(16 pages, 10 with identical information + 6 regionalyadapted)
• All practical information
• Interviews with opinion leaders – both national and regional
• Interviews with salespersons, postmen (people like me)
• FAQ about euro and answers
• Short historical overview
• Infographics, practical advice
Information materials• General information
• Handbook for enterpreneurs – practical
guidelines
• Infographics
Information: • in stores, banks, post offices etc.• in materials for clients• for employees• on FMCG products• and many more
Involving enterpreneurs in euro communication
Materials were distributed in:• seminars,• Eurodays, • euro
exhibitions,• media events,• local gov.,• associations,• senior
associations, • libraries,• society of the
blind people,• post offices,• Latvian Railway,• supermarkets, • companies,• electronically
~2 mill. informative materialsInformative material Amount Description
Household consignment 1252400 Informative brochure to all households which is adjusted to certain region
Brochure about security 300000 Security advices in cooperation with the State Police
Pensions (broadsheet) 140000 Information about changes in pension payment schedule; security; process of the introduction of euro
Europeace guide 120000 Advices to entrepreneurs in cooperation with Association of Commercial Banks of Latvia
Stickers with official currency rate 50000 Stickers with official currency rate and informative phone number
Stickers «Fair euro introducer» 46000 Sticker with inscription «Fair euro introducer», from both sides
Brochure «What trader must know about the dual price display»
18000 Main information and demands regarding dual price display
Broadsheets – diplomas for traveling exhibition 15000 Diploma (with commemorative coin) for traveling exhibition
Brochure «Important about euro» 15000 Summary of practical information - what is euro; introduction; currency rate; timetable, etc.
Equity capital stock (infograf) 11000 How and when to do denomination of equity capital stock
Trader’s journal 5000 Journal about practical euro information for entrepreneurs and trades
Practical guidelines brochure 4000 Practical guidelines in areas of accounting, tax payment, cash registers, dual price display, costumerrights, etc.
Brochure «Competition Council about the cartels and other forbidden deals»
3000 Forbidden deals, action, punishment, how to decrease risks, etc. LV and RUS
Brochures «Fair euro introducer» 2000 Information about campaign’s objective, memorandum, gains and how to join
Posters "Fair euro introducer" 1000 Poster about gains from participation and information for consumers
10 Euro advices E-version 10 advices, what to do, to ensure transition to euro safe, easy and comfortable
Infograf – shopping in lats during first twoweeks
E-version Shopping during the period of parallel circulation of lats and euro
Infograf – be prepared for the introduction ofeuro on time
E-version Timetable, how to prepare for the introduction of euro
Brochure for foreign guests 20000 Most important information about the euro introduction in 4 languages
Brochure for disabled persons 5000 Most important information about the euro introduction for disabled persons
>30 000 seminar participantsEuro working group seminars
- In year 2013 245 seminars in 50 cities and villages
- 28159 participants in whole Latvia (15 000 inhabitants, 6500 entrepreneurs and 6000 state and local government employees)
- Last professional seminar in Riga – 20 December 2013Webinar - Association of Commercial Banks of Latvia (ACBL) big euro
webinar on september 25 with participation of 15 experts in latvian and russian languages – 530 online viewers, more than 4500 offline viewers and amount is increasing.
- ACBL and Latvian Chamber of Commerce and Industryorganised euro seminar/webinar for entrepreneurs
Other seminars
- Bank of Latvia, Employers' Confederation of Latvia , MoE seminr cycle in 28 cities with 2200 participants and other seminars
>40 000 participants
Event Notes
Eurodays - In 5 Eurodays participated more than 10’000 people (Ventspils –700, Liepāja – 2300, Daugavpils – 1800, Jelgava – 3100, Valmiera –2200)
- In „Fair euro introducer” seminars registered 250 participants (+ 300 online viewers)
- Euroday test in all four cities filled 1589 Euroday visitorsEuroexhibition
- In EC exhibition «Eiro – our currency» Rīga – 2806 visitors, Daugavpils – 6620, Liepāja (open until January 12) – 4000
- ECB/Bank of Latvia euro exhibition in theater «Daile» – more than 16’500 visitors
Eight stories about the eurofor children and youth audience• To inform teachers and school children, the
Ministry of Education and Science distributed to all schools an information brochure for teachers and produced cartoons to be introduced in the schools’ curricula
Other target materials
• Several activities targeted both the visually impaired and the hard of hearing with trainings on the design of the new banknotes and coins, security features and general changeover modalities.
>45 000 www.eiro.lv visitors per month
• Info telephone 8000 3000 (1744 calls in October, 2334 calls in November, 2437 calls in December, 4874 call in 1-14 January. Main topics – currency rate, general questions about euro, where to exchange)
• www.eiro.lv (during 2013 ½ million visitors)
• Weekly euro news page – for media and for eiro related institutions (1200 receivers)
• [email protected] – more than 700 questions from homepage with replies provided within 24 hours 37% of people named eiro.lv as a
source of information (Factum, 11.2013)
>1,521,634,000 audience abroad
• Latvia’s Euro changeover at New Year’s eve was broadcast by 52 accredited journalists from 31 foreign media (Europe, Asia, North America). TV – 12, news agencies – 9, photo news agencies – 5, radio – 3, newspapers + online editions – 9
• 156 registered publications• Media coverage (not including news
agencies) – more than 1,5 billion people• Neutral publicity. French and Swedish media
highlighted the low inhabitants support, other countries media – Latvia’s incredible ability to overcome economic crisis
>67 000 followers in social media• Social networks:
• Facebook – 1228 followers• Twitter – 1784 followers (theoretically
tweets reach 407 200 users, one tweet –2887 users)
• Draugiem.lv – 65 674 followers (8th place in page top)
• Additional activities• Coin guessing game• Cash changover network map• Searching for Latvian maiden photo
competition• Euro calendar aplication
Public attitude
- Newest EC sociological research center's «Eurobarometer» survey (published on 20 December): In Latvia 53% support euro (average support level in EU is 52%). Support since survey in summer has increased by 10 % points.
- A large majority of Latvians (79%) perceived the changeover as smooth andefficient («Eurobarometer» 16-18 January).
- TNS in January (Swedbank survey):
- around 66% of Latvian inhabitants and 64% of entrepreneurs confirm that the changeover process was convenient;
- the mass media was the main information source for the euro introduction for 85% of Latvian inhabitants and 68% of entrepreneurs.
Survey data on euro public support
0%
10%
20%
30%
40%
50%
60%
January'2013
April May June September October November December January'2014
TNS Latvia Factum Euro barometer TNS Omnibuss
Public awareness
98% know – on January 1
Latvia will introduce euro
89% feel informed well
enough about transition process(Factum, 12.2013)
Ge
ne
ral
1. stage: 19.09. –02.10.
- Latvia’s euro coin’s appearance and origin- Euro date in Latvia- Main sources of information
2. stage: 21.10. –15.12.
- Pension and benefit payment order- Money changeover options- Most convenient payment options
Fair
eu
ro in
tro
du
cer 1. stage:
10.09. –09.10.
- With objective to activate entrepreneurs(signes up 1216 companies with >10000 adresses,Recomended by inhabitants >400 companies
2. stage: 19.09. –02.10.
- With objective to invite inhabitants recomend fair entrepreneurs
Changeover conclusions
Changeover symbiosis
State and municipal IT
systems
Banking sector
Retail sector
Smooth change-
over
Inhabitants behaviour
Hints for the changeover night
Transition period during the night of 31 December :
- technical IT migration processes (numerous preliminary tests were very important)
- to draw the atention on usual everyday processes: POS reports, etc.
- cash register journals in two currencies (suggestion to use already established examples by the State Revenue Service)
Changeover most intense period and final stages27.12.2013-06.01.2013
06.01.2014-14.01.2014
INTENSIVE SUPERVISION SUPERVISION
- Transition period overnight of 31 December: ATM, POS, cash registers, internetbanks, IT systems.Technical risks were minimised as much as possible!
- During first two weeks: mutual understanding – please don’t rush, don’t crowd and don’t be angry!
Two currency parallel circulation. Additional work for sellers and attention for costumers
14.01.2014-01.08.2014
- In February final public survey.- Until 04.2014 info telephone line continues working.Seminars about accounting and redenomination of equity capital stock issues on 19 February
01.08.2014-31.12.2014
- Until the end of 2014 price monitoring will be continued.- Benefit management.Worries of undue priceinflation. To evaluate euro introduction influence on inflation that was negligible in other countries
Transition period of two weeks of dual circulation: 1 – 14 January
• ATM cash withdrawals at the level of usual average (~100 euro).
• Citizens used card payments 20-30% more to make the process smooth and easy.
Euro changeover facilitated the changes in financial services habits
Source: TNS, 18 February (Swedbank survey)
• 74% inhabitants highly evaluated internetbanking priorities
• 67% inhabitants will use more payment cards
• 61% inhabitants will keep more money at banks' accounts
Key success points:
• Project planning
• Learning from other countries experience
• Team spirit and numerous open discussions
• Strong communication partners (procurement procedure to choose the best partner)
Media
Merchants: cash registers,
price display, etc.Communica-tors
Banks
Inhabitants:librarians,
info centersAccountingand taxes
Risksassessment
Professional expert grouping
IT registry
Municipalities
Concluding seminar on the best practice in euro project (videos at eiro.lv):
• On project overview and practical guidelines
• On communication and procurements
• On risk and benefit management
• On ICT migration and security issues
• On Latvijas Pasts experience
• On «Fair euro introducer» and price display
Thank You for Your attention and cooperation!