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After last year experienced minor recession of Latvian goods exports in January this year has already shown strong growth compared to January 2016 increased by 13.3%, the sharpest increase in exports since April 2013. Export growth in January has been comprehensive, only a slight decrease in exports of machinery and equipment, while the largest contribution to the total growth of exports provided the main Latvian export commodity groups, including wood and wood products, as well as agricultural commodities and food.
Wood and wood products exports in January compared with January last year, increased by 16.6%, and wood products with a 19.4% share in January set to become the largest Latvian export trade group. Totally disappear in 2014 and in 2015 Russia introduced sanctions impact of food and agricultural products exports in January increased by 12.0%. The largest increase in exports of food products have been used for dairy products - by 42.3%, and the drinks - by 71.2%, fully compensating for grain exports fell by 30.7% compared with January 2016.
Significant influence over the total export growth in January has given the metal and metal product exports, it increased by 38.3%. Like in 2016, continues to grow strongly in the construction of export products, as compared to January of previous year increased by 31.8%.
Strong export growth rate of renewal in January has provided both the improvement in external demand, accelerating economic growth rates in the Latvian main foreign trade partner and exportable commodity prices, including food products and mineral products and exporters of favorable euro exchange rate dynamics.
Improving the economic situation in Russia and the disappearance of previously introduced sanctions base effects, Latvian exports to Russia in January, compared to January of previous year increased by 52.5%, value of exports starting to get closer to the level in which it was before the occurrence of geopolitical conflict in early 2014. Thus, compared to January 2014, Latvian exports to Russia was no longer just about 12.1% lower. Despite the previously voiced concerns about the development of the Latvian trade relations with Britain after Brexit vote, Latvian exports to this country continues to grow steadily, and in January, compared to January last year, has increased by 11.5%.
Similarly, factors such as the Latvian recent months have affected the export growth across the region, and also in Lithuania and Estonia in January recorded strong export growth - by 19.4% and 14% compared to last year's corresponding month. Also, in the coming months, the strength in foreign demand, the expected high growth rates of Latvian exports. At the same time, rising domestic consumption and investment, as well as an increase in imported commodity prices, strong plant, imports, preventing a significant improvement in the overall Latvian foreign trade balance. In January, the Latvian imports of goods compared to January last year, has increased by 18.5%, and the foreign trade deficit, imports grew faster than exports, rose to 175.4 million euros compared with 116.6 million euros a year ago.
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