Diaspora Engagement Possibilities for Latvian Business Development

DIASPORA ENGAGEMENT POSSIBILITIES FOR LATVIAN BUSINESS DEVELOPMENT

BY DALIA PETKEVIČIENĖ

CONTENTS

CHAPTER I. Diaspora Engagement Possibilities for Business Development ...... 3 1. Foreword ...... 3 2. Introduction to Diaspora ...... 5 2.1. What is Diaspora? ...... 6 2.2. Types of Diaspora ...... 8 3. Growing Trend of Governments Engaging Diaspora ...... 16 4. Research and Analysis of the Diaspora Potential ...... 18 4.1. Trade Promotion ...... 19 4.2. Investment Promotion ...... 22 4.3. Entrepreneurship and Innovation ...... 28 4.4. Knowledge and Skills Transfer ...... 35 4.5. Country Marketing & Tourism ...... 36 5. Case Study Analysis of Key Development Areas ...... 44 CHAPTER II. Diaspora Mapping: Strategy and Tactics ...... 54 1. Methodology Recommsendations for Mapping the Diaspora ...... 54 1.1. Research for Prospects ...... 54 1.2. Tapping Into Technology ...... 56 1.3. The Digital Generation of The Diaspora ...... 57 2. Sources and Means to Identify Target ...... 58 2.1. Sources to Identify Diaspora ...... 58 2.2. Means of Mapping Target Group ...... 59 3. Tactics of Building Diaspora Registry ...... 65 CHAPTER III. Diaspora Engagement for the Economic Development of Latvia ...... 67 1. Latvian Diaspora Status Quo and Potential ...... 67 1.1 . Overview of Latvian Diaspora status quo and potential ...... 67 1.1.1. Latvian Diaspora: Changing Definitions and History ...... 68 1.1.2. Latvian Diaspora: numbers and geographies ...... 69 1.1.3. Urbanization in Latvia: Moving to the Cities ...... 75 1.1.4. New Generation Migrants of Latvia ...... 76

1.1.5. The Potential of Returning Migrants ...... 77 1.2 . Latvian Diaspora’s Effect on Economy ...... 79 1.2.1. Remittances: Latvians Sending Money Home ...... 80 1.2.2. Latvian Diaspora’s Effects on Investment, Entrepreneurship, Growth ...... 83 1.2.2.1. World Class Achievers ...... 85 1.2.2.2. Change Agents ...... 88 1.2.2.3. First Movers ...... 91 1.2.2.4. Tipping Agents ...... 94 1.2.2.5. Career Returnees and Remote Mentors ...... 97 1.3. Research and Situation Analysis of Latvian Diaspora Policies ...... 99 1.3.1. Governmental Policies for Engaging Diaspora ...... 99 1.3.2. Implementing Latvian Diaspora Policy ...... 103 1.3.2.1. Diaspora Networks in Action ...... 104 1.3.2.2. Professional Clubs of Latvian Diaspora ...... 107 1.4. Analysis of Diaspora Engagement within LIAA ...... 109 1.4.1. Overview of Export Priorities ...... 109 1.4.2. Overview of FDI Promotion Priorities ...... 110 1.4.3. How LIAA works with Latvian Diaspora ...... 112 2. Engaging Latvian Diaspora: Framework and Recommendations ...... 120 2.1. Diagnosis and Guiding for Engaging Diaspora ...... 120 2.1.1. SWOT Analysis of Engaging Latvian Diaspora ...... 120 2.1.2. The Scope of Recommendations...... 121 2.2. Framework of the Diaspora Engagement Policy ...... 122 2.3. Policy Recommendations for Engaging Latvian Diaspora ...... 124 2.4. Recommendations for Action Priorities ...... 131 2.4.1. Encourage FDI and DDI to Latvia ...... 132 2.4.2. Attract Venture Capital and Support Local Businesses to Grow...... 135 2.4.3. Focus on Young International Professionals and Students ...... 138 2.4.4. Look for Synergies within Existing Activities ...... 144 3. Closing Remarks ...... 145

List of Qualitative Interviews 146

CHAPTER I. DIASPORA ENGAGEMENT POSSIBILITIES FOR BUSINESS DEVELOPMENT

SITUATION ANALYSIS AND GLOBAL PRACTICE RESEARCH

1. FOREWORD

Facing globalization, countries around the world have begun to target their Diasporas in new ways and seek to build mutually beneficial relationships and partnerships with them.

Rather than viewing them as being “gone” from the home country, they re-engage with the homeland through strategic Diaspora initiatives such as investment and trade programs, formal mentoring programs, and cultural initiatives. Though often encouraged, they do not always need to return in order to make a difference.

Nowadays the physical presence does not always reflect a case of one’s impact. In the new world of remoteness, countries also compete for the allocation of time and intellectual input, money or other form of human resource impact. This impact is not necessary created by a person physically present inside the geographical border of the country.

“Global Diasporas represent a collective of people through whom networks can be created and individuals mobilized for mutual benefit of both Diasporas and the home country. Global Diasporas serve as an important channel, facilitating the two-way flow of capital. That capital presents itself in every form be it human, social, intellectual, cultural or financial. Looking at capital flows alone, the transfer of funds in the form of remittances, bonds, philanthropy or business investment is massive by any scale and growing.”1

1 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

This Strategy paper aims to provide analysis and research of Diaspora engagement possibilities for creating the best possible set of policy recommendations to develop the growth framework for Diaspora driven possibilities for promoting Latvian business development. The author is referring to the insights and research done by most accomplished Diaspora strategists. Therefore, it includes three main steps in its methodology:2

 Global best practices, case studies’ analysis and data collection  Review of existing policies and initiatives in Latvia  Expert experience, frameworks and recommendations

Analysis of these three elements will allow providing with Latvia-specific Diaspora driven business development framework and recommendations.

“DIASPORA CAN CONTRIBUTE TO DEVELOPMENT BY CREATING BUSINESSES AND JOBS, STIMULATING INNOVATION, CREATING SOCIAL CAPITAL ACROSS BORDERS, AND CHANNELING POLITICAL AND FINANCIAL CAPITAL TOWARD THEIR COUNTRIES OF ORIGIN.” K. NEWLAND, H.TANAKA, 20103

2 Based on Diaspora Direct Investment (DDI) as a Development Tool methodology (IDB, 2010)

3 K. Newland, H.Tanaka Mobilizing Diaspora Entrepreneurship for Development (USAIDD, MPI, 2010)

2. INTRODUCTION TO DIASPORA

“DIASPORA COMMUNITIES ARE OFTEN THE PRIME MOVERS IN RESPONDING TO IMPORTANT EVENTS, WHETHER WE’RE TALKING ABOUT A NATURAL DISASTER OR A TERROR ATTACK, A FINANCIAL CRISIS, OR EVEN EMERGING BUSINESS OPPORTUNITIES.”

JOHN KERRY, U.S. SECRETARY OF STATE, WASHINGTON, DC, OCTOBER 9, 20154

According to the United Nations, more than 230 million people lived outside of their countries of birth in 2013, and over 700 million migrate within their countries. “Along with remittances, Diasporas can be an important source of trade, capital, technology, and knowledge for home countries and destination.”5 With a growing scale of global migration and boosting power of networks through smart communication and travel, the world is constantly facing new challenges and opportunities related to Diasporas.

To illustrate that it is worth quoting The Economist, which recently wrote: “These days, however, Diasporas are increasingly seen as talent pools that can be pumped. When its economy crashed in 2009, Ireland summoned some of its most successful overseas progeny to an economic forum, which continues to meet every two years. Mexico used to think of its Diaspora in America mostly as working-class remittance senders. It now encourages its young citizens to study in American universities—and then bring their skills home. Ghana, which has a particularly talented Diaspora, has set up a support unit to schmooze them.

No country is hungrier than China. Emulating Taiwan, which built a technology industry with the help of Taiwanese Stanford graduates, it is trying to woo its most talented foreign-educated citizens to come back; those who do are called “sea turtles”. Provincial cities offer tax breaks to returning entrepreneurs and create industrial parks for them. Under the “thousand talents” scheme (which is even more

4 Remarks at the 2015 Global Diaspora Week Launch Event "Partnering for Global Impact" Available at: http://www.state.gov/secretary/remarks/2015/10/248072.htm

5 The World Bank Migration and Remittances (Washington DC. 2013). Available at: http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:20648762~pag ePK:64257043~piPK:437376~theSitePK:4607,00.html

5 ambitious than it sounds) academics who have built careers abroad are offered far more money than is usually paid to Chinese professors.”6

While Europe and the World are facing recently growing migration crisis caused mainly by forced or economic migration, this paper is focusing on the opportunities that are created by moving or/and remote intellectual capital and labour force. Many countries are concerned about the brainpower behind the migration. In many of them Diaspora is perceived as an intellectually valuable asset.

2.1. WHAT IS DIASPORA?

“DIASPORA, IN ITS MOST BASIC SENSE, REFERS TO A SCATTERING OF PEOPLES WHO ARE NONETHELESS CONNECTED BY A SENSE OF A HOMELAND, IMAGINARY OR OTHERWISE.”

KINGSLEY AIKINS, GLOBAL DIASPORA STRATEGIES TOOLKIT (DIASPORA MATTERS, 2011)

Before starting to move deeper into the subject, it is important to define the term Diaspora itself. The term causes a lot of confusion and debate. Especially nowadays, when people tend to be constantly more mobile, the usual emigrant-like term becomes too narrow. However, let us look into several of the definitions.

As Wikipedia defines it, the word Diaspora comes from Greek διασπορά, "scattering, dispersion" and means the movement of the population from its original homeland.7 The term Diaspora might often be associated particularly to historical mass dispersions of an involuntary nature, such as the expulsion of Jews from Judea, the fleeing of Greeks after the fall of Constantinople.

The International Organization for Migration mostly defines Diasporas as part of ethnic and national communities, who keeps relations with their homelands, despite not living there on the daily basis. The term ‘Diasporas’ conveys the idea of transnational populations, living in one place, while still maintaining relations with their homelands, being both ‘here’ and ‘there.8

6 Article Gone but not forgotten (The Economist, Jun 27th 2015)

7 Wikipedia, Diaspora. Available at https://en.wikipedia.org/wiki/Diaspora

8 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

Cho, L. expands this definition by saying that “Diaspora brings together communities which are not quite nation, not quite race, not quite religion, not quite homesickness, yet they still have something to do with nation, race, religion, longings for homes which may not exist. There are communities, which extend across geographical spaces and historical experiences. There are vast numbers of people who exist in one place and yet feel intimately related to another.”9

Sheffer suggests, “Modern Diasporas are ethnic minority groups of migrant origins residing and acting in host countries but maintaining strong links with their countries of origin – their homelands.”10 Thereas Docker defines Diaspora as “a sense of belonging to more than one history, to more than one time and place, to more than one past and future.”11

It is not the primarily aim of this paper to provide a final definition for the modern concept of Diaspora. No clear agreement exists on the definition of the term. Because as noted by Palmer ‘If all movements of people do not result in Diasporas, what, then, distinguishes Diasporas from other movements of people?’ However, “everyone seems to agree that Diaspora, in its most basic sense, refers to a scattering of peoples who are nonetheless connected by a sense of a homeland, imaginary or otherwise.”12

As Aikins suggests “while it is important to define what it is meant by Diaspora, it is equally important not to get caught up in unnecessary semantics when designing a Diaspora strategy. Perhaps the best way to define a Diaspora for the purposes of

9 Cho, L. (Spring 2007) ‘The Turn to Diaspora’ Canadian Journal of Cultural Studies, TOPIA,

Number 17: Diasporic Pasts and Futures: Transnational Cultural Studies in Canada.

10 Sheffer, G. ‘A New Field of Study: Modern Diasporas in International Politics’ in Sheffer, G. ed.

Modern Diasporas in International Politics (London: Croom Helm, 1986).

11 Docker, J. 1492 The Poetics of Diaspora: Literature Culture and Identity (London Continuum, 2001).

12 Palmer, C., (2000) Defining and Studying the Modern African Diaspora 85 The Journal of

Negro History 1.

7 designing Diaspora strategies is to break down the Diaspora into different types.”13 Therefore, the next sub-chapter focuses on the Diaspora grouping to understand how diverse it can be.

2.2. TYPES OF DIASPORA

In order to understand the object of the study in this paper, it is important to know how to segment Diaspora or migrants. It will also be important element of Diaspora database creation as the next stage in this paper.

Dustmann put migrants into a number of categories below.14 The main types are temporary, permanent and political. Since nowadays migration is far less permanent

13 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

14 Dustmann, C. Temporary Migration and Economic Assimilation (Institute for the Study of Labor Discussion Paper No.186, August 2000).

8 than it was in previous decades with increasing categories of temporary migration emerging, let us take a closer look at a temporary migration.

Figure 1. Types of Migration.15

Dustmann defines transient migration as a situation where the migrant moves between different host countries without necessarily returning home; contract migration as a temporary migration where the migrant lives in the host country for a limited number of years, which is regulated by a contract; and return migration describes a situation where migrants return to their country of origin by their own choice, often after a significant period abroad.

A 2007 paper published by the Migration Policy Institute described circular migration as ‘a continuing, long-term and fluid movement of people among countries that occupy what is increasingly recognized as a single economic space.’16

Another popular term to describe the phenomenon of the nowadays-mobile people, moving around, is the one of a global expat (or expatriate) or a global leader. As covered in Harvard Business Review: “They are as eager to broaden their personal horizons as they are to expand their professional prospects. They do not expect or desire to spend their career in the same organization or country. They enjoy mobility and view it as necessary to gather the experience, ability, connections and credibility that will turn them from nomadic professionals into global leaders.

15 Taken from Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

16 Agunias D. and Newland K. Circular Migration and Development: Trends, Policy Routes, and Ways Forward (Migration Policy Institute, April 2007).

Yet home need not always be a place. It can be a territory, a relationship, a craft, a way of expression. Home is an experience of belonging, a feeling of being whole and known, sometimes too close for comfort. Those attachments liberate us more than they constrain. As the expression suggests, home is where we are from — the place where we begin to be.” 17

Cohen has also indicated five different categories of Diasporas: victim, labour, trade, Imperial (which may be considered a form of trade Diaspora), and cultural (not indigenous to the area from which they dispersed, i.e., Caribbean) Diasporas.18

Increasing migration is what most countries are experiencing. Inward, outward, temporary, permanent, return, circular – people are constantly moving and the definitions pertaining to the homeland community must reflect this. As emigration increases, so too does the size of the Diaspora.

In order to segment Diaspora Aikins suggests four relative elements:

“Time: When does a ‘migrant’ cease to be one and become part of the ‘Diaspora’? Given the increase in circular migration, it is difficult to limit today the notion of Diasporas to those who are settled ‘forever’ in a country other from where they were born. The modern notion of ‘Diasporas’ has lost its dimension of irreversibility and of exile. Migrants go to work abroad, sometimes under specific government schemes, decide to stay longer, to return and to leave again. It appears that countries supporting temporary labour migration are also concerned with Diaspora contributions, such as the Philippines, Bangladesh, Ukraine, Kenya, Ethiopia or Uganda.

Place of birth: Second and third-generation migrants born to immigrant parents abroad can have a stronger feeling of belonging to the Diasporas than first generations and retain some form of commitment to, and/or interest in, the country of origin of their parents. Thus place of birth does not itself define belonging to a Diaspora.

Citizenship: Many nationals acquired the citizenship of their host country. Their contributions therefore would not be included in ‘migrant workers’’ remittance flows, for instance, whereas they may well be interested in investing in different ways in their home country. Thus, we do not qualify Diasporas according to their citizenship.

17 Gianpiero Petriglieri Moving Around Without Losing Your Roots (Harvard Business Review,2012) Available at: https://hbr.org/2012/10/moving-around-without-losing- your-roots

18 Cohen, Robin. Global Diasporas: An Introduction (Routledge London, 2008)

Identity and belonging: Butler’s definition of Diasporas draws attention to the intangible dimension of the term. Being part of a Diaspora implies a sense of identification with a group, or the feeling of belonging to a certain identity. Families play a role in supporting or rejecting this identification, as do legal norms (citizenship for second generations), educational programs and the possibility to travel. Ministries for expatriates, as well as consulates and embassies are beginning to pay more attention to the ‘feeling of belonging’ and to the non-material dimension of engaging with Diasporas. However, if symbolic inclusion matters, it needs to be translated into actual inclusion (legislative and institutional realities).”19

Finally, here are the types suggested to use to categorize Diaspora members. It is based on a slightly modified Aikins K. classification and offers to categorize the Diaspora in the following way:

“Lived Diaspora – individuals born in the home country, who now live permanently or temporally in a host country.

Ancestral Diaspora – individuals with ancestral links to the home country (for example second and third generation Diaspora members). The experience of Global Lithuanian Leaders or Irish Funds is that sometimes-later generations become even more committed to the land of their ancestry than their parents or grandparents.

Next generation Diaspora – these are younger members of the Diaspora, typically under the age of 35, who are fundamental to engage in order to ensure the sustainability of current Diaspora strategies.

Returning Diaspora – Diaspora members who have lived in a host country and who have come back to the home country.

Affinity Diaspora – nationals of other countries who work or study or who once worked or studied in the home country but have since re-migrated. Many Diaspora initiatives worldwide have an element of engaging “friends of the home country”. E.g. Global Lithuanian Awards and Global Australian Awards both have a category for affinity Diaspora, where they award for non-citizens the contribution to the country well-being.”20

19 Ionescu, D. (2006) Engaging Diasporas as Development Partners for Home and Destination Countries: Challenges for Policymakers (IOM Migration Research Series Paper No. 26) (International Organization for Migration, 2006)

20 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

Globetrotters - a habitual worldwide moving professional or freelance worker/traveller. This category is typical to top league professionals or next generation Diaspora working remote jobs. They usually do not want to spend their career and identify with the same organization /country. They enjoy mobility and view it as necessary to gather the experience, ability, connections and credibility.

2.3. HEARING OUT: WHAT MOTIVATES DIASPORA ACTION?

“WITHOUT A LOCAL HOME WE LOSE OUR ROOTS, WITHOUT A GLOBAL HOME WE LOSE OUR REACH. […] ULTIMATELY, THE WORK OF GLOBAL LEADERS — CONNECTING THEIR LOCAL AND GLOBAL HOMES WITHIN AND AROUND THEM.”

GIANPIERO PETRIGLIERI, HARVARD BUSINESS REVIEW, OCTOBER 2012

Before we continue to analyse ways to engage Diaspora into the economy of the home country, it is important to analyse the needs of Diaspora. In other words, this sub- chapter will focus on possible triggers, which might best help to mobilize the Diaspora for action.

The paper puts a lot of focus what can Diaspora do for the countries. Before starting building strategy of engaging Diaspora, it is essentially important to know what countries can do for their Diasporas. Responding to several typical needs might trigger different categories of Diaspora’s action.

Giving Back

There is no obligation for the Diaspora to give back to the motherland, especially as some do not feel as though they can identify with their place of origin. However, those Diasporas who are brought up elsewhere, many are seen to be in touch with their identity and yearn to make a positive change/contribution to their place of origin.

The recent Diaspora, mainly economic migrants, might remain negative with the notion of giving back because they do not believe that they were given anything in the first place. They might be disappointed with the economic situation, regime, social environment and similar life aspects. In some cases, Diasporas are disconnected from the homeland and its culture; they did not grow up in ancestral land and are not aware of the customs, beliefs or social policies, which govern the state. Thus, it appears pointless for them to give back to a place that they do not identify with. For them, it would merely be a handout or a gesture of goodwill rather than a conscious decision. This is why it is significant to many that they are not made to feel obliged to “give back”, rather they should be encouraged and shown the reasons why they should.

However, there exist a usually the consensus that Diasporans should go back to the motherland to give back, sometime there are many, who feel they are in no place to go to home country and impose international ideologies, doctrines on the home society. It brings to question why many consider Diasporas as “qualified” or wise enough to bring about any viable contribution to homeland and what are the ways to do it in most efficient manner.21

Keeping track

The need to keep track of the personal/professional network and information is especially typical to the new generation Diaspora and globetrotters - those studying, temporary working, doing their mid-career steps abroad. Some of the mid-achievers, see it also as a potential opportunity to “leave the doors open” in case of the right circumstances for coming back will appear. Those circumstances might be related to family reasons (children rising or retirement planning in homeland) as well as proper career opportunities.

To be top of mind when prospects need your services can be sought while being abroad. You lose your contacts and contextual understanding while being away. Some professionals abroad are signing in some local organizations, initiatives to keep track. For others this is additional trigger to participate in mentoring programs, give visiting lectures at universities and schools, and publish articles. However, taking action is the only way to keep track and Diaspora initiatives must use it.

Identity and belonging

Global expats or Globetrotters as defined in the Diaspora categories above, usually demonstrate an expressed need for identity and of belonging. Petriglieri stresses this need, which is typical for Global leaders, otherwise, he tells, they turn into “nomadic professionals”.

“Their unwillingness or inability to settle — to embrace and be defined by one place only — draws them to each other. It makes them restless and curious. It helps them develop the sensitivity to multiple perspectives and the ability to work across cultures that are indeed hallmarks of global leadership. It also comes with a price. That price is struggling with the question of home and its troublesome acolytes: identity and belonging.

21 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

No one wants to follow a stranger. Without some sense of home, nomadic professionals do not become global leaders. They only turn into professional nomads. Leaders need homes to keep their vision, passion and courage alive — and to remain connected both to the people they are meant to serve, and to themselves.

Rather than learning to live away from home or do without one, global leaders must learn to live in and between two homes — a local and a global home. Become familiar with local and global communities, and use neither to escape the other. Hard as it may be to reconcile local and global homes, it is a privilege to have a chance to inhabit both. ”22

Recognition and rewards

Over the past several years, many countries in developing their Diaspora strategies have included a mechanism for formal recognition. While it may be considered unnecessary, an act of recognition or expression of appreciation is likely to ignite a positive reaction from particular segments of the Diaspora and would help highlight many of the efforts made on the part of particular individuals or organizations, which can otherwise go unrecognized. Having a mechanism through which to thank Diaspora members will potentially increase engagement, raise awareness and generate substantial good will. In short, there is much more upside than downside. 23

Remembering the forgotten

It must be remembered that while there are a great number of top-level influencers within the Diaspora, there may also be vulnerable and forgotten members of the Diaspora, particularly older persons living in isolation, poverty and deprivation without the support of family and friends. Any Diaspora policy must also provide for these members of the ‘Forgotten Diaspora’ – most of whom would have made provision for their homeland throughout their lives through substantial remittances or other means.

An example of a Diaspora initiative reflecting this need is The Ireland Funds philanthropic campaign entitled ‘The Forgotten Irish’ which is principally directed at

22 Gianpiero Petriglieri Moving Around Without Losing Your Roots (Harvard Business Review,2012) Available at: https://hbr.org/2012/10/moving-around-without-losing- your-roots

23 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

14 those Irish migrants who went to Britain in the second half of the twentieth century. The majority left to find work, and sent billions of pounds home to their families.

At the end of their working lives, many had the means to go home, however, many are still in Britain, often living in isolation, poverty and deprivation – without the support of friends or family. It has been estimated that there are in the region of 100,000 ‘forgotten Irish’ living in Britain.24

24 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

3. GROWING TREND OF GOVERNMENTS ENGAGING DIASPORA Many countries have attempted to create specialized and focused bodies that can concentrate on issues concerning Diaspora.25 Diaspora ministries generally enjoy more consistent budgetary allocation, support from the top of government, and interestingly, a more explicit development-oriented mandate. In addition, offices are created at sub-ministry and local levels.

Table 1. Examples of Governments with Diaspora institutions.26

25 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

26 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

Some Diaspora institutions fall short of full ministry standing but still report directly to the highest executive body. For example, the Commission on Filipinos Overseas (CFO) is directly under the Department of Foreign Affairs.

Local-level institutions play a critical role too. In Gujarat, India, the local government created a Non-Resident Indian (NRI) Division with a stronger focus on development. Using a database that identifies their technical and professional skills, the NRI Division seeks to strengthen ties with Gujaratis abroad. Today, Gujarat is the #1 FDI destination in India, surpassing long-term leader Mumbai.

As The Economist reflects “in the early 1980s barely a dozen countries had a ministry, a government department or some other official institution dedicated to their Diasporas. And a few countries, including America, still ignore those who have left—except perhaps to send them tax demands. But these are a shrinking minority (see Chart 1.). Kingsley Aikins, an Irishman who advises governments on how to deal with their far-flung folk, has travelled in the past few weeks to Lebanon, 27 Chart 1. UN States with Diaspora Institutions, %. Malawi and Wales Ministers and bureaucrats are multiplying partly because Diasporas are too. The World Bank reckons that about 250m people live outside the country of their birth; the number of foreign migrants living in OECD countries rose by 38% in the 2000s. In addition, Diasporas are not just composed of emigrants. The Irish government thinks that everybody of Irish descent—perhaps 60m or 70m people—is part of the Irish Diaspora. Israel claims all Jews.”28

27 Source: Article Gone but not forgotten (The Economist, 2015) Available at http://www.economist.com/news/international/21656176-governments-believe- their-diasporas-can-solve-all-sorts-problems-they-are-picky

28 Article Gone but not forgotten (The Economist, 2015) Available at http://www.economist.com/news/international/21656176-governments-believe- their-diasporas-can-solve-all-sorts-problems-they-are-picky

4. RESEARCH AND ANALYSIS OF THE DIASPORA POTENTIAL

Diasporas can make both tangible and intangible contributions to their home country. Tangible contributions include remittances and investment; intangible contributions include professional expertise, international networks, and cultural ambassadors.

There is a lot of evidence of development impact results of Diaspora engagement in different countries. The impact of Diaspora can have different dimensions within the field of business development. It is possible to classify the effect into four main areas:

trade; investments; entrepreneurship; knowledge and skills transfer.

The question often raised is how to measure results or any other evidence of Diaspora engagement in any of the fields. One way of answering that question is by displaying examples of proof in various countries. In the next sub-chapters you can find overview of proof analysis in different categories of economic effect. 29

Before starting proof analysis, the author draws attention that there are five types of Diaspora involvement based on Newland’s research — networking, mentoring, training, investment, and venture capital and partnerships. They describe ascending levels of commitment to the entrepreneurial project (see Figure 2.). While a combination of all five levels of engagement is likely to foster entrepreneurship, for a variety of reasons — including availability of resources and time, and the different actors involved at each level — the more passive forms of support (toward the base of the pyramid) are likely to proliferate and dissipate more quickly than the more active forms of support near the peak.30

29 K. Newland Mobilizing Diaspora Entrepreneurship for Development (2010)

30 K. Newland Mobilizing Diaspora Entrepreneurship for Development (2010)

Figure 2. Levels of Commitment to Diaspora in Business. 31

4.1. TRADE PROMOTION In some countries, there are links between existing Diasporas and increased trade. This is caused mainly by Diaspora’s connections delivered to producers and consumers both in the country of origin and destination.

There exist evidence of correlation between the presence of Diaspora in the country and the trade ties of Diaspora’s origin. A study of Canada’s trade with cumulated. One study of Canada’s trade with 136 partner countries in the 1980-92 period showed that a 10 percent increase in immigration from a particular country was associated with a 1 percent increase in exports to that country, and a 73 per-cent increase in imports from it.

Diaspora populations consume the products of their countries of origin and introduce such products to their country of settlement. In the case of El Salvador, for example, the Diaspora’s purchases of traditional products from El Salvador account for as much as 10 percent of the country’s total exports.32

In transferring or developing economies, the link is even more visible. To illustrate that we can talk about the Lithuanian Diaspora, where many as one million Americans alone can claim Lithuanian descent. Emigration to America began in the 19th century, with an interruption during the Soviet occupation, when travel and emigration were

31 K. Newland Mobilizing Diaspora Entrepreneurship for Development (2010)

32 K. Newland Mobilizing Diaspora Entrepreneurship for Development (2010)

19 severely restricted. Since the fall of the Soviet Union in 1991, many Lithuanian owned or managed Trade consultancy companies have been operating. One of them Food Depot International - an importer and distributor of European food and beverages to the US founded by Angela Kavak, American Lithuanian. Food Depot International is importer of 1500 Lithuanian made goods to more than 20 states in the US.

Exports and Trade promotion Programs’ Case: GlobalScot

GlobalScot is a diverse network of business leaders, entrepreneurs and executives with a connection to Scotland - and a strong desire to see Scottish businesses succeed locally and in the wider world. Run by Scottish Enterprise since 2001, the network has helped transform the face of Scottish business, giving hundreds of emerging and growing companies in Scotland a head start to compete in a global marketplace.

These are the primarily activities of GlobalScot:

Business support  Advice on entering new markets, finding customers and suppliers;  Support for growth and international trade opportunities;  Advice on planning, knowledge and skills;  GlobalScot events. Events  Meet GlobalScots at events in Scotland and across the world;  Make connections with global leaders in key sectors;  Access the networks and contacts of GlobalScots. Leadership  Support to build a strong culture of leadership in your business;  Share in GlobalScot expertise at master class events;  Inspiration to achieve your full potential;  Industry Insights. Industry insights  Insight into key sectors and global emerging opportunities;  Support to identify the right opportunities for your business.

Picture 1. Where GlobalScot members are from.33

GlobalScot Kyle Whitehill, CEO of Vodafone Qatar helps a local company

“Thanks to a leading GlobalScot, what began as merely a promising opportunity for one Scottish company to engage with a telecoms giant rapidly turned into a real catalyst for growth.” David Bonner, vice president of marketing at Edinburgh firm Ciqual, explains.

The chance to pitch their product to the senior team at one of the world’s leading telecoms operators is something which most small technology firms can only dream about. However, for Edinburgh Company Ciqual, the dream became reality when initial phones chat with GlobalScot Kyle Whitehill, CEO of Vodafone Qatar, led to an invitation to travel to Doha to meet with and pitch to the telecoms giant’s full management team.

Ciqual delivers customer experience management services to mobile operators, which allow them to take quick action to identify and resolve any issues customers, are having. Recognizing the potential of the firm’s technology, Kyle’s willingness to open doors to the key decision-makers at Vodafone was a real turning point for Ciqual’s prospects.”34

33 GlobalScot website. Available at: http://www.globalscot.com/

34 GlobalScot website. Available at: http://www.globalscot.com/

4.2. INVESTMENT PROMOTION We have already analysed Trade promotion triggered by Diasporas, where it is not very easy to measure the result, since it is usually a particularly long-term matter. More evidence and success stories exist of Diaspora driven FDI.

There exist a certain term to describe Diaspora correlated FDI. That is – Diaspora Direct Investment. This sub-chapter will analyse Diaspora Direct Investment (DDI) as a Development Tool.35

DDI is concentrated in four main segments:

 Capital Markets, Savings, Funds;  Remittances;  Real Estate and fixed assets;  SME Ventures.

In this paper, we will not go deeper into the remittances part, though it is a very tangible effect of emigrants sending money back to their home countries. However, this effect is rather short-term, less stable and usually cannot be affected much by governments or NGO’s. Promoting remittance flows is usually one of the first Diaspora strategies employed by countries looking to financially engage their Diaspora and to increase capital flows back into the home country. It is more typical to developing countries. Remittances can be seen as the necessary embryonic step in cultivating revenues for homelands and can prove important for improving the creditworthiness of a nation. However, as countries develop further capital flow strategies, reliance on remittances invariably decreases.

Although remittances are the best-known flow of monies from the Diaspora to its homeland, there are other instruments that can capture some of these monies as well. Foreign currency accounts and bonds are designed to specifically attract the migrants’ monies. A Diaspora bond is a debt instrument issued by a country – or potentially, a sub-sovereign entity or a private corporation – to rise financing from its overseas Diaspora.

35 Diaspora Direct Investment (DDI) as a Development Tool, IDB

Table 2. Comparison of Diaspora Bonds Issued by Israel and India.36

Given the evident success and financial yields of the issuance of Diaspora bonds in India and Israel, it is surprising that so few other countries have yet to follow suit. Aikins suggest that reasons for this may include:

 There is limited awareness about this financing vehicle. Governments and other entities are often deterred by the complexities of bond instruments. Lacking the capacity to undertake bond issuance, they take the easy way out of depending upon national banks to generate local and foreign currency deposits (LCDs and FCDs) from Diaspora investors.

 Many countries still have little concrete appreciation of the capabilities and resources of their respective Diaspora due to the failure of many potential issuers to plan ahead. Indeed many potential issuers resort to whatever instruments are at hand at the last minute of need. Furthermore, many also abandon their plans for using new financing mechanisms as soon as the financing gap goes away.

 Countries that have a hostile Diaspora are unlikely to succeed in rising financing through Diaspora bonds. Also countries with political insecurity and weak institutional capacity would find it hard to market Diaspora bonds unless more creditworthy institutions provide credit enhancements.

36 Ketkar & Ratha ‘Diaspora Bonds: Tapping the Diaspora During Difficult Times’ (2010) 1 Journal of International Commerce, Economics and Policy 2

 Suggested key factors for the success of Diaspora bonds are the absence of civil strife in the home country, the ability to meet registration requirements and a sizeable first generation Diaspora.37

Diaspora Direct Investment Promotion is worth when you analyse the following benefits of it. Benefits of DDI are multi-pronged, longer lasting and more dispersed across the economy than FDI. Diaspora Direct Investment Promotion may result in the following effects:

Brain Gain. While migration of a skilled workforce provides valuable foreign remittances, focus on DDI can reverse some of the brain Drain as the Diaspora sees promising opportunities back home. This brings in skills, knowledge, and capital and market access to the home country.

Technology Transfer. The positive impact on technology transfer is higher in the case of DDI than FDI. While foreign investors have fears of technology leakage and IP violation, the Diaspora typically is more open-minded. Diaspora groups are better informed about the capabilities and technology necessary for working in their home country.

Higher & Stable Investment. The Diaspora is less averse to political risk and economic shocks and they feel pride in investing in their homeland. DDI is a lot stickier than FDI as the Diaspora have a better grasp of the local business environment and are less likely to pull back investments. Due to close personal and cultural ties, they are more patient with ROI and take a more holistic approach.

Catalytic Effect. The Diaspora has better insights into the advantages and disadvantages of the local economy and may act as leaders in investing in a particular under-served sector. This can spur investment and can act as catalysts for FDI investors.

Diplomatic Effect. The Diaspora provides a strong relationship anchor and act as a conduit between the host country and home country for increased trade and investment. They can act as catalysts for bi-lateral trade agreements, investment initiatives and consortia. Strong familial and cultural ties can help deepen relationships between the two countries.

37 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

“Diasporas play a similar dual role when it comes to investment, both investing directly in their countries of origin and persuading non-Diaspora investors to do the same. A study published by the World Bank mapped the stock of African migrants in Organization for Economic Cooperation and Development (OECD) countries against investment from these countries into the migrants’ countries of origin, and found a very strong indication that the existence of migrant networks increases both direct investment and portfolio investment.

Political scientist David Leblang used statistical methods to test the hypothesis that Diaspora networks influence global investment by reducing transaction and information costs, and found that “even after controlling for a multitude of factors, Diaspora networks have both a substantively significant effect and a statistically significant effect on cross-border investment.”38

The role of the Diaspora is particularly important to economies that have yet to gain the confidence of foreign investors, and especially to those emerging from war. Although the precise proportion is not known, most of the investment now going into Somalia appears to be derived from the Diaspora.

Exposure to Diaspora members often enhances the reputation of the country of origin and gives investors greater confidence in the quality of its labour force and business climate; moreover, Diaspora members who reach positions of responsibility in a corporation are in a position to steer foreign investments to the country where they know the language, culture, and business networks well.

Case of Citigroup India

Citigroup’s large number of Indian-origin senior executives has smoothed its way to becoming one of the two largest foreign banks operating in India. Within any Diaspora, it is likely that only (although it is less stable).

Within any Diaspora, it is likely that only a small minority will have the inclination, skills and knowledge to become direct investors in their ancestral homeland, but many others may be willing to invest some part of their savings in trusted financial instruments indirectly — by buying shares in a fund, buying a bond, or putting funds into a deposit account in a country-of-origin. For example, Senegal has established an

38 K. Newland What we know about Diasporas and Economic Development (2013)

25 investment fund for Senegalese abroad, which has financed 804 projects worth a total of 20 billion CFA francs ($40 million).39

Case of Intel Israel

Dov Frohman, an Israeli, was a leading scientist with the Intel Corporation in the US. He was offered the opportunity to return home to Israel to take up a research and teaching position at the Hebrew University of Jerusalem. Intel did not want to lose him – he was a talented scientist who had invented and developed the erasable programmable memory chip (EPROM). To avoid losing him, Intel established its first integrated circuit design centre outside the US, in Haifa, and asked Frohman to lead it. The rest, as they say, is history. Israel went on to become a leading centre of worldwide integrated circuit design and manufacturing.40

Investments promotion program case: Connect Ireland

There exist many successful action programs to target Investment promotion of the sending countries. Some of them are forth a particular attention.

The Connect Ireland initiative was launched in 2012 in Dublin. The initiative is part of the Government’s Action Plan for jobs. The Connect Ireland scheme aims to create 5000 jobs over five years. Under the initiative, any person who succeeds in bringing a company to Ireland which creates jobs will be paid a minimum of €1,500 per job, up to a maximum of 100 jobs. One has to register as a connector, refer a company that may be considering an international expansion and the Connect Ireland contacts the company to explain the advantages of establishing in Ireland. If the company chooses Ireland the connector can benefit from the reward.41

Through companies directly connected through ConnectIreland 1,500 jobs have been created for the Country. See the general overview of the year 2015 of the results of Connect Ireland:

39 K. Newland What we know about Diasporas and Economic Development (2013)

40 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

41 ConnectIreland website: http://connectireland.com/what_is_connectireland.aspx

African Diaspora Marketplace

An interesting initiative in promoting DDI is the African Diaspora Marketplace (ADM). The ADM is a business plan competition designed to support economic development in Sub-Saharan Africa and allows the US-based African Diaspora community to directly invest in viable small and medium enterprises. In 2010, fourteen Diaspora-driven businesses in seven countries were awarded matching grants ranging from $50,000 to $100,000. Winning entries ranged from a commercial plant tissue culture business that uses biotechnology to increase yield and quality of produce for Ethiopian agriculture producers, to a franchise business model that will empower female nurse entrepreneurs to improve access to healthcare and reduce the burden on government hospitals in Ghana.42

The Irish Technology Leadership Group

The Irish Technology Leadership Group (ITLG), founded by John Hartnett, is a group of Irish and Irish American senior executives based mainly in Silicon Valley, active in the global technology industry, committed to ensuring that Ireland remains a strategic area of investment and opportunity for US technology companies, and committed to supporting the global growth and development of Irish based technology companies. Two spin-offs have emerged from ITLG. The Irish Innovation Centre in San Jose, California is an incubator that provides Irish or Irish-American start-ups with office space, legal and financial advice, administrative support and networking opportunities. ITLG also launched another initiative, the Irish Technology Venture

42 Note From the African Diaspora Marketplace: Supporting Entrepreneurship for Diaspora-Driven Development (Microlinks, 2010) Available at: https://www.microlinks.org/fr/learning-marketplace/notes/note-african-diaspora- marketplace-supporting-entrepreneurship-diaspora-dr

Fund. Investors, with the support of the Irish Government, have put in their own money to create a source of capital for young companies in need of investment.43

4.3. ENTREPRENEURSHIP AND INNOVATION Entrepreneurs are the best Diaspora subset for DDI. To illustrate that, one example field is innovations.

In June 2015, the Economist took a measure from the World Intellectual Property Organization to look into scientific and technical patents record, looking into not just where an inventor was working but also where he or she was born. It was thus possible to measure expats’ brainpower. “By this yardstick Britain, Canada, China, Germany and India have the most talented Diasporas. Relative to their home populations, though, expats of African countries such as Ghana and Nigeria are the most accomplished. Between 2007 and 2012, expatriates registered more than nine-tenths of patents filed by people born in those countries. Surprisingly, a higher proportion of Brits who register patents are working abroad than is the case for Chinese people (20%

43 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

v 17%). China’s liberal patenting system is one reason; another, perhaps, is the British talent for melting into other countries and thriving there.”44

Immigrant Entrepreneurs has been a rising force especially in the US. Considering the US immigrant profile, DDI is the best bet to infuse knowledge, skills and technology into the local economy.

According to American Immigration Council across the United States of America, there is no doubt that immigrant entrepreneurs and innovators play an important role. Immigrant entrepreneurs bring in additional revenue, create jobs, and contribute significantly to the economy. Immigrant small business owners contribute in many ways to their Chart 2. Patents Fild by Emigrants.45 local communities. Furthermore, highly skilled immigrants are vital to the country’s innovation industries and to the many metropolitan areas across the nation, helping to boost local economies.46

The United States is home to many successful companies with at least one founder who was an immigrant or child of an immigrant. In 2010, more than 40 percent of the Fortune 500 companies were founded by immigrants (90 companies) or children of

44 The Economist Migrant brainpower (Jun 27th 2015 ) Available at http://www.economist.com/news/international/21656175-migrant-brainpower

45 The Economist Migrant brainpower (Jun 27th 2015 ) Available at http://www.economist.com/news/international/21656175-migrant-brainpower

46 Immigrant Entrepreneurs and Innovators across the United States by American Immigration Council Available at: http://www.immigrationpolicy.org/just- facts/immigrant-entrepreneurs-and-innovators-across-united-states

29 immigrants (114 companies), according to the Partnership for a New American Economy. 47

The Fortune 500 companies that immigrants started employ over 3.6 million people, and the combined employment of the companies started by immigrants or their children is over 10 million people worldwide. Fortune 500 companies started by immigrants or their children generated revenue greater than the GDP of nearly every country in the world (except Japan, China, and the United States). $1.7 trillion in revenues is attributable to the companies founded by immigrants, and that figure rises to $4.2 trillion when combined with the revenues of companies founded by the children of immigrants.48

Immigrants founded many recognizable “American” brands. These companies include: AT&T, Kraft, Proctor & Gamble, U.S. Steel, DuPont, Goldman Sachs, Kohl’s, Honeywell, and Nordstrom. Today, immigrants start many recognizable high-tech firms, including Google, eBay, Yahoo and Intel.

A 2013 study from the National Venture Capital Association highlights the impacts of immigrant entrepreneurs on the U.S. economy, and shows that the number of immigrant-founded venture-funded companies is increasing. Initial public offerings of venture-funded companies with an immigrant founder jumped from 20 percent prior to 2006 to 33 percent after 2006. The studies also found that one-third of the entrepreneurs starting privately held venture-backed companies were foreign-born. Immigrant entrepreneurs come through all immigration channels: 40 percent of the immigrant founders in the survey entered the U.S. as employment-sponsored immigrants, 38 percent as international students, 13 percent as family-sponsored immigrants, and the rest in another category.

Immigrant-founded venture-backed companies create extraordinary value. As of June 2013, such publicly traded companies have a total market capitalization of $900 billion. If this group of companies were a country, they would be among the top twenty economies in the world. Immigrant entrepreneurs’ companies create new jobs in the U.S. Immigrant-founded venture-backed public companies employ approximately 600,000 people, mostly in the United States.

47 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

48 Forbes 40 Percent of Fortune 500 Companies Founded by Immigrants or Their Children (Jun 19, 2011) Available at: http://www.forbes.com/sites/stuartanderson/2011/06/19/40-percent-of-fortune- 500-companies-founded-by-immigrants-or-their-children/ 30

According to economist Robert Fairlie at the University of California, Santa Cruz, immigrants start businesses at a higher rate than the native-born: the business formation rate per month among immigrants in 2010 is 0.62 percent (or 620 out of 100,000), compared to 0.28 percent for non-immigrants (or 280 out of 100,000).

Immigrants in the United States also contribute to the country’s innovation economy by earning patents on new research, products, and ideas. According to the Partnership for a New American Economy, 76 percent of patents awarded to the top ten patent- producing U.S. universities in 2011 had at least one foreign-born inventor. For high- tech and cutting-edge fields, the rate of foreign-born patenting at those institutions was even greater: semiconductor device manufacturing (87 percent), information technology (84 percent), pulse or digital communications (83 percent), pharmaceutical drugs or compounds (79 percent), and optics (77 percent).”49

DDI efforts are targeted towards creating more jobs and bringing skill and knowledge into the country. It is imperative that countries realize that what DDI can attract in terms of investment would be different in size and form than FDI but its impact would nevertheless be far reaching for the development of the economy. Even though very little research has been completed on how Diaspora entrepreneurs contribute to, the economic development of their countries of origin, through what is sometimes called Diaspora direct investment, there is reason to believe that Diaspora entrepreneurship has the potential to contribute to development.50

DDI can play a 5-pronged role in encouraging SME Internationalization and Entrepreneurship:

Influential Executives. Diaspora who are managers, founders and owners of firms, companies, mentor give advice to top executives of SMEs at home countries. Having experience of managing their firms abroad they use their managerial help in order to finance, transfer experience, develop and grow technical know-how of the companies in their home-country.

Mentoring and Advising. Mentoring companies by abroad professionals is very effective due to the cultural knowledge and understanding. Diaspora’s access to global best practices and market can create successful knowledge transfers. Successful

49 Immigrant Entrepreneurs and Innovators across the United States by American Immigration Council Available at: http://www.immigrationpolicy.org/just- facts/immigrant-entrepreneurs-and-innovators-across-united-states

50 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

31 examples of countries working in that field are India, China would be India, S. Korea, Taiwan, Israel.

Venture Capital and Investors. Diaspora members use knowledge of their home countries to mitigate risks in making investments. Personal and professional networks between Diaspora members and business partners in their countries of origin help identify new opportunities and reduce transaction costs. Diaspora-led funds are typically more successful. Good examples would be India, China.

Businessmen/ Entrepreneurs. Diaspora members are able to identify niche markets back home based on their professional experiences abroad and capitalize on business opportunities. Diaspora entrepreneurs are able to bridge the gap between local expertise and global markets. Successful examples would be Israel and India.

Return of talent and knowledge transfer. Governments implement policies that encourage members of the Diaspora to return to their countries of origin to contribute to economic development. In addition, they provide the required spill over effect through directly / indirectly training the local population with the new knowledge, the Diaspora acquired in abroad. Successful examples would be China and S. Korea” 51

Entrepreneurship and Innovation Program Cases

Often the significance of Diaspora members as entrepreneurs themselves is overlooked and yet research would indicate that as a collective group, not only are they more inclined to start their own enterprises, they are also more likely to succeed than those without international experience.

The Indus Entrepreneurs (TiE)

Probably the leading organizational example of organized support on the part of the Diaspora for entrepreneurship is The Indus Entrepreneurs (TiE), which is a global professional Diaspora network.

The Indus Entrepreneurs (TiE): ‘The mission of TiE is to promote entrepreneurship through mentoring, networking and education. The vision of TiE is to be recognized as the global organization fostering entrepreneurship.’

As noted by Robertson ‘these kinds of professional diasporic networks can become the means through which social networks are extended to their home countries, kick starting developments sufficiently for these entrepreneurs to return to invest significant time, knowledge and capital in their home country. In the case of the Indus

51 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

Entrepreneurs, this meant investing back in Bangalore in India, and establishing a Silicon Valley like cluster there.’52

IntEnt

An example of innovative program promoting Diaspora entrepreneurship is IntEnt, which is based in the Netherlands. Founded in 1996, it provides support to Diaspora entrepreneurs in the Netherlands that would like to set up a new business in Surinam, Ghana, Turkey, Morocco, Ethiopia, Afghanistan or Curacao. The basic principle behind IntEnt is that migrants, once they have settled in the Netherlands, can be catalysts for the development of their country of origin. IntEnt assists in obtaining finance and has a guarantee fund to issue supplementary guarantees. In addition, IntEnt offers business advice during and after the start-up in developing countries.53

Armenia 2020

Armenia 2020 is an organization that engages the Armenian Diaspora to identify a variety of development scenarios for the Republic of Armenia until 2020. Through its discussions and forums, it seeks to feed advice into the policymaking process for Armenia’s development process. A number of the organization’s board members sit on the National Competitiveness Council of Armenia (NCCA), which assists the prime minister in setting policies to attract vital investments to Armenia. In partnership with the Harvard Alumni Club of Armenia among others, Armenia 2020 organized the first Armenian National Business Contest that sought applications from Armenian entrepreneurs to present their business plans to international business leaders. The winners of the contest were given the opportunity to present their business plans at the annual International Business Plan Competition held by the Entrepreneurs Club of Harvard Business School.54

ChileGlobal - talent network for innovation

52 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

53 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

54 K. Newland, H.Tanaka Mobilizing Diaspora Entrepreneurship for Development (USAIDD, MPI, 2010)

The mission of ChileGlobal aims to support the development of innovation, highly qualified human capital, and business creation at home. Network members offer their time, experience, contacts, knowledge and skills for this purpose.’55 The network was started in 2005. Chile started a connection among successful Chilean entrepreneurs and executives living and working in foreign countries, with interest in contributing to Chilean economic development.

This model seeks to stimulate the participation of emigrants in the development of their countries of origin, mitigating the negative effects produced by a country’s brain drain and turn it into ‘brain circulation’ or ‘brain exchange’. A Technical Secretariat runs it at first installed in Foundation Chile, a private non-profit institution that has played a significant role in Chile’s technological development.

Successful in its efforts, the network was considered a national public interest project and financed by Chilean public funds until 2009. A high average level of education, usually higher than their host country’s average, characterizes Chilean immigrants. Consequently, there is Chilean talent elite composed by people who have studied abroad, belong to professional networks of well-known universities, and developed a prolific net of contacts with well-positioned persons around the world.

Organized, they are making a significant contribution to their home country as investors, promoters of technology transfer and providers of international support for local firms and entrepreneurs. Today around 400 members, distributed in the USA, Canada, Mexico, Brazil, Argentina, Australia, China, Spain, Sweden and England, form ChileGlobal. Within this program, members offer time, experience, contacts, knowledge and skills to help internationalize Chilean companies. The mission of this program is to increase the exposure of Chilean businesses and entrepreneurs to international business ideas and knowledge and to help those with the potential to grow to choose the most appropriate domestic and international opportunities. Here is the distribution of members by their occupation. Most of the members represent Next generation Diaspora.

55 ChileGlobal website: http://www.chileglobal.net/

Figure 3. The Distribution of Members.56

4.4. KNOWLEDGE AND SKILLS TRANSFER For many countries, the Diaspora acts as a brain trust, connecting critical components of the public and private sectors to expertise not available within the country and compensating to some degree for the departure of highly skilled emigrants.

Some skills and knowledge transfer initiatives rely on the temporary (and occasionally permanent) return of skilled Diaspora members to the country of origin to teach and train, although these initiatives are hard to scale up because of their high cost and the difficulty of detaching professionals from their regular jobs abroad for meaningful periods of time.

Global Lithuanian Leaders

Global Lithuanian Leaders | GLL is a high impact non-profit platform of Lithuania – connected international professionals building global opportunities for Lithuanian economy. Established after the first World Lithuanian Economic Forum in 2009, today GLL connects 700 members from almost 40 countries around the world. GLL is the set of tools for Diaspora to get involved in a meaningful way. GLL Business Advisors Program - the program is designed to bring together Lithuania’s most successful and experienced international professionals to inspire, educate and enhance opportunities of Lithuania’s growing businesses. LT Big Brother - a global voluntary professional mentoring program for Lithuanian students around the world.

56 ChileGlobal website: http://www.chileglobal.net/

Other initiatives emphasize the development of Diaspora networks whose activities are not dependent on physical presence in the country of origin. Chile, for example, has been able to work with highly skilled Chileans abroad through ChileGlobal — the Talent Network for Innovation. ChileGlobal promotes and facilitates the development of key economic clusters in Chile by reinforcing their links with Chileans residing abroad who contribute their time, experience, contacts, knowledge, and skills to help globalize Chilean companies. Through its network of about 400 influential Chilean members abroad, ChileGlobal designs and finances business projects that introduce innovations in both the production and services sectors, boost human capital to augment productivity, and promote the country.

4.5. COUNTRY MARKETING & TOURISM The aim of nation branding is to create and promote a distinct self-image and international reputation that will most effectively serve a nation’s interests. It is the strategic self-presentation of a country with the aim of creating reputational capital through economic, political and social interest promotion at home and abroad.

When we speak of ‘the brand’ of a country, it generally means the common images, perceptions and associations people have with that country. Every country has a brand, whether it likes it or not. Therefore, it should be strategically managed to challenge the unfavourable stereotypes and close the gap between perception and reality.

A country’s brand can affect every interaction with the outside world. That is most obvious in trade, investment and tourism, but it also affects how the country’s citizens are treated when they go abroad to study, work or conduct business.

While it is always subjective, a strong brand can be a country’s greatest asset and the Diaspora can play a fundamental role in shaping and selling the brand abroad. It is important to note, however, that ‘Country branding requires persistence because it seeps ever so slowly into the minds and hearts of the target audiences. It requires a very solid foundation because, like the cathedrals of the past, it is a work that will continue and even outlive several generations.’

There is a need for greater coordination and collaboration in selling a country overseas and indeed engaging the Diaspora in that task. All involved in this endeavour should be aware of each element of the country’s brand mix – be it investment, trade, tourism, culture, entertainment, sport, philanthropy – and understand how they all interact. As noted by Simonin, ‘lack of integration on these various fronts leads to fragmentation and can be seriously counterproductive.’

To overcome any confusion in relation to a country’s brand, Mathias Akotia, CEO of Brand Ghana, proposes that ‘Country branding takes an integrative and concerted effort by all concerned stakeholders. Success requires collaboration of many of the senior-most figures in the country – both in government and the private sector.’ This is because ‘the international “audience” is only likely to form a coherent and positive opinion of the country if the majority of the messages they receive from it are broadly aligned.’

Engagement with Diasporas is assuming ever greater importance in today has networked world. Beyond the significant economic contribution that Diasporas can make to their origin countries, Diasporas can also play a key role in countries’ nation- branding strategy. Nation branding is often misperceived as being nothing more than the crass application to nations of slogans, logos and advertising. However, such a view misses the holistic approach that characterizes good nation branding, in which stakeholder collaboration plays a role as important – if not more important – than the visual trappings of the nation brand. In this perspective, Diasporas represent one of the nation brands most influential and important stakeholder groups.57

‘OVERSEAS INDIANS WORLDWIDE WHO ARE OUR BRAND AMBASSADORS PRODUCE AN ECONOMIC OUTPUT OF ABOUT $400 BILLION ... THE FACT THAT EVERY TENTH INDIAN- AMERICAN IS A MILLIONAIRE AND EVERY FIFTH START-UP COMPANY IN

57 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

THE SILICON VALLEY IS OWNED BY AN INDIAN, HAS DOUBTLESS, ENHANCED THE IMAGE OF INDIA.’

OVERSEAS INDIAN AFFAIRS MINISTER VAYALAR RAVI, 2007

Diaspora mobilization and engagement should represent a key element of a country’s nation-brand strategy. The Diaspora may be viewed as a pre-existing network of potential nation-brand ambassadors awaiting activation. Although the terminology of nation branding is not used by the World Bank Institute in its ground-breaking book Diaspora Networks and the International Migration of Skills: How Countries Can Draw on Their Talent Abroad (Kuznetsov, 2006), many of the issues addressed in that text are relevant to the objectives of a nation-branding strategy. For example, Leautier states that the people in Diaspora networks ‘can be crucial bridges between state-of- the-art in policy, technological, and managerial expertise and local conditions in their homeland’, a view that is shared by Kuznetsov and Sabel (2006) who identify policy expertise and managerial and marketing knowledge as the most significant resources of Diaspora networks.

However, little research has been conducted with regard to the most appropriate structures and processes that can facilitate the effective contribution of a country’s Diaspora to the country’s nation-branding strategy.

Some countries have been more energetic than others in attempting to engage with Diasporas. South Korea, for instance, has established the Overseas Koreans Foundation, which encourages education exchanges, cultural and business networking, and research into overseas Koreans’ agendas. During a ceremony marking the fourth anniversary of Korean Day, the important role of the Korean Diaspora was acknowledged by Prime Minister Kim Hwang-sik who stated that ‘the growth of overseas Korean communities is a symbol of the Republic of Korea reaching out to the world’. It could be argued that this form of ‘reaching out to the world’ through the Diaspora is far more effective than mere marketing communications, the route that has unfortunately been chosen by many countries in their nation branding.58

Country marketing & tourism program cases

The best brands understand that word of mouth is more powerful than advertising, and a brand needs good ambassadors. In promoting a country’s brand, its Diaspora is the most powerful brand ambassadors it has. Many countries have been slow to capitalize on the willingness of their Diaspora to help in their nation-branding

58 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

38 strategy. As is pointed out in the 2009–10 Trinidad and Tobago Business Guide, ‘Trinidad and Tobago’s large global Diaspora, much of it centred in the major metropolitan capitals, provides a ready-made network and an interesting investment proposition.’ In order to mobilize its Diaspora, the home country needs to develop a structure and process to ensure that Diaspora members who wish to help in the country’s nation branding can do so.

Remember that Diaspora members embody the essence of the nation’s brand and can bring the brand to life. Nothing sells a product better than a personal connection or a recommendation from a friend. Affinity Diaspora members can also play a fundamental role in promoting a country’s brand; as they have either worked or studied in the country, they have a fundamental understanding of the core strengths and values of the country, which they can promote abroad.59

The Presidential Council on Nation Branding (PCNB) was established on 22 January 2009 to enhance Korea’s national status and prestige in the international community by implementing systematic and comprehensive strategies. It held a seminar entitled ‘The Role of the Diaspora in Nation Branding’ at which 50 experts from home and abroad looked at success stories and proposed ways in which Koreans living overseas could effectively contribute to shaping a positive image of their home country. The council for further development is currently reviewing the proposals made at the seminar.

Copenhagen is also turning to its Diaspora members to promote the city abroad. The Copenhagen Goodwill Ambassador Corps is part of Copenhagen Capacity’s and Wonderful Copenhagen’s marketing strategy for the region. The purpose of the corps is to market the capital region abroad via personal relationships. The target group is decision makers in international companies (tipping agents) and the idea of the corps is that Danish Diaspora members are the best people to sell Copenhagen. The position of goodwill ambassador is honorary and the appointment is exclusive and subject-to- subject approval.

The Brand Kenya Board is Kenya’s nation-branding corporation. The board was founded in late 2008, when Kenya was in most need of an image and perception overhaul in the wake of the widely publicized post-election crisis. The organization’s mandate revolves around building a favourable image for Kenya abroad, as well as cultivating a sense of deep-rooted patriotism among its citizens; with the Kenyan Diaspora included. Brand Kenya has been making major progress in Diaspora

59 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

39 engagement by pursuing innovative ways to utilize the Diaspora for the good of the country brand. Diaspora engagement is one of the most rewarding country branding strategies as it presents an avenue for the Diaspora to market Kenya to foreign audiences at a personal level, thus making the country brand trust worthier to potential visitors.

Brand Kenya is encouraging members of the Diaspora to do this by being good brand ambassadors, which entails representing Kenya in a good light through their words and actions while they engage in everyday interaction with the native citizens of their host countries. We often hear statements such as ‘it took Oprah to invest in a girl’s school in South Africa’! Many have argued that there are not similar initiatives coming from Africa’s own icons. Alternatively, is it a case of Africa not recognizing its own? Where are Kenya’s Oprahs? Do they exist yet nobody knows about them? Brand Kenya Board has embarked on initiatives to sensitize their Diaspora to their roles as brand marketers and ambassadors.

They aim to highlight the Kenyans in the Diaspora who are doing a lot more than we hear or read about. The board recently attended the UK Diaspora Property and Investment Expo during which the UK-Achiever awards were held. This presented an opportunity to start identifying future brand ambassadors. After the Expo, the team went to Bedford and Scotland to meet the Kenyans in the Diaspora to educate them on their roles as Kenya’s brand ambassadors. Kenyans in the Diaspora are best placed to be the greatest country and brand ambassadors and have the power to correct any misconceptions that the external world has of Kenya. They can be great ambassadors of economic change if they are sensitised and presented with the relevant information. Kenya has a wide base of strategically positioned Diaspora all over the world, especially in countries like the US, UK, Dubai and South Africa.

Kenya seems to have woken up to the fact that its Diaspora can significantly contribute to the development that is needed in the country. However, Diaspora members need to be made aware that while they are a nation’s best brand builder, they can equally be the biggest brand destroyers. They need to take a step back and understand that any negative and non-factual information they provide shapes their nation’s brand. They should therefore seek to understand and locate their own actions in the value chain of the country’s nation-building exercise.

Hosting Nation Days

Countries around the world have begun to host ‘Nation Days’. This is an innovative and fun way to promote the country’s brand and, in doing so, engage with global Diaspora members.

For example, every year the Overseas Singaporean Unit hosts ‘Singapore Day’ in a different city. In 2007, 6,000 Singaporeans celebrated the day in New York. In 2008, 11,000 Singaporeans gathered in Melbourne for Singapore Day. In 2009, 12,000 Singaporeans attended Singapore Day 2009 in London. This year, Singapore Day will be celebrated in Shanghai. During the day Diaspora members can enjoy a showcase depicting how Singapore is developing into a global city with a promising future for all Singaporeans.

G’Day USA is an annual program designed to showcase Australian business capabilities in the US – Australia’s largest trading and investment partner. Over the last seven years, G’Day USA has brought together industry leaders and key people in government, business, tourism, academia and the arts to successfully cultivate and enhance the long-term and deep Australia–US relationship. The result is one of the most effective, far-reaching and comprehensive annual national promotions across many areas important to both Americans and Australians. The 2011 G’Day USA 14- day program brings new business, art, education and tourism events to eight cities (Los Angeles, San Diego, San Francisco, Sacramento, Denver, Houston, Boston and New York), with the goal of strengthening bilateral collaboration and realising new business opportunities. Over 30 events will reach targeted audiences in the eight cities through conferences and forums, networking, product sampling and promotions.

Other countries use global cultural events to promote their nation brand and engage with Diaspora members. Ireland sees nearly every country in the world celebrate its culture on St Patrick’s Day, 17 March. This day provides for the global promotion of ‘Brand Ireland’ over a number of days. For example, on 14 March 2011, New York Stock Exchange and the Irish American Business Association, in partnership with Business & Finance, hosted ‘Ireland Day’. More than 350 Fortune 500 company executives, US corporations, venture capitalists, market makers, as well as some of the leading international Irish business leaders and executives descended on Wall Street for the event. The aim of the event was to showcase Ireland as a place to do business, focus positive international media on the country and create a debate on the key issues for the country and its role in the global economy.

Regional Diaspora networks also organize nation days. Brazil Day in New York originally celebrated Brazil’s Independence Day. Since 1984, that small celebration has grown, up to the point of attracting over 1.5 million people in 2009; it is now considered the world’s biggest Brazilian event outside Brazil and one of the Big Apple’s greatest ethnic events. Brazilian Day Festival is not simply a party celebration; it has become an opportunity for the Brazilian community to reach out in the United States. On that day, Brazilians join each other from different parts of the world (many coming from Brazil just to attend the festival) to show their pride, advertise their culture and

41 experience the nostalgic and anonymous feeling of being an immigrant away from home.60

Norway Day Festival is held in San Francisco, more than 5,000 people attend each year. The main purposes of the festival are to promote and maintain a mutually satisfactory relationship between Norway and the US; to help descendants of Norwegian immigrants to appreciate and retain contact with their heritage; and to promote ‘Modern Norway’ by drawing attention to all the good things that have been accomplished by ‘Norway Today,’ especially in the areas of technology, ecology, and world diplomacy.

The power of culture should not be underestimated when developing strategies for engagement by the Diaspora and branding a nation. It plays an essential role in the process of enriching a country’s brand image. The value of culture in national branding is that, like geography, it is a truly unique feature of the country. A key benefit of basing the branding process on culture is that it helps countries to identify their most authentic competitive advantages. Respected brands build trust, add meaning to their offerings and say what they stand for and why people should support them.

Countries are using culture as the bridge between the homeland and Diaspora. The British Council is the leader in this field, founded in 1934, nowadays it has a budget of over £560 million. Its overseas network extends to 233 locations in 107 countries and territories, employing over 7,000 people. There are 70 British Council Teaching Centres in 53 countries.

Another example - The Confucius Institute is a Chinese non-profit organization promoting Chinese language and culture around the world. The first Confucius Institute was opened in 2004 and there are now 328 institutes in 82 countries. The Chinese Government aims to establish 1,000 Confucius Institutes by 2020.26.

Invite Your Friends to New Zealand Campaign

An interesting campaign targeted not only to the Diasporas but also to overseas friends of all New Zealanders. Prime Minister encouraged all New Zealanders to invite their overseas relatives and friends to visit here. He launched a campaign – the "Great Kiwi Invite" – aimed at boosting

60 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

42 tourism by offering personalized invites to come to New Zealand.

The aim of the campaign, by Tourism New Zealand, is to increase the number of visitors to the country in the midst of the global recession when fewer people are travelling the world. His New Zealand’s campaign in 2009 called “The Great Kiwi Invite” New Zealanders were able to go online and send a personal animated invitation to someone overseas. 61

61 NZ Herald Invite your friends, relatives to NZ: Key (Jul 31, 2009): http://www.nzherald.co.nz/travel/news/article.cfm?c_id=7&objectid=10587855

5. CASE STUDY ANALYSIS OF KEY DEVELOPMENT AREAS

This sub-chapter will focus on case analysis of implementing Diaspora engaging policies and strategies while promoting trade, investment and business development. It details different policies and initiatives that various countries have been undertaking.

However, these reviews are not intended to be full-scale, nor is it assumed that each initiative may be applicable to Latvia or any other country. Each country has its own set of unique characteristics and strengths, its own distinct Diaspora community/-ies and its own diverse culture.

Still the strategies set out below provide countries with an overview of the multiple options for engaging the Diaspora – financially, culturally and socially. At present many countries, approach to its Diaspora takes the form of what might be referred to as a developmental state, lightly incubating initiatives, which have emerged organically from an already existing diasporic community. An interesting topic for evaluation is how the initiatives presented here might be used to develop a more sophisticated, coordinated and targeted strategy for engagement of the Diaspora and the development of mutually beneficial relationships and partnerships.

A critical element for the future success of any Diaspora policy will be prioritization. Initiatives must also be targeted, with specific objectives, measurable outcomes and full accountability. Implementing a successful national strategy for engaging the Diaspora takes time, preparation, patience and proper execution. While many countries have attempted to introduce Diaspora strategies, not all have succeeded. There are multitudes of reasons that can lead to the failure of Diaspora strategies and it is important to be aware of these and learn from the mistakes of others to ensure that they are not repeated in future Diaspora policies.

In this part we will focus on case studies in the key development areas and tools of engaging. The network Diaspora organizations or functions within governments use different tools that could be divided into the following groups.

 Business and Networking Events;  Business Matching Tools;  SME Technology and Innovation Center;  Venture Capital Funds;  Single Window Investment Facilitation;  Mentoring Framework;  Training and Skills Development;

 Rewarding systems. 62

Business and Networking Events

Networking is one of the most important drivers for Diaspora to connect. Developing a platform for networking that encompasses all current Diaspora initiatives. A common networking platform with SIGs (Special Interest Groups) catering to different categories. Host regular events in key Diaspora regions for displaying new opportunities. In order to attract Diaspora members, it is imperative to nominate successful and respected experts in their fields as champions. The country can select Champions for each sector/region led by a Diaspora luminary. These leading Diaspora members should be widely recognized and respected.63

The cases worth looking at are Global Irish Economic Forum, Global Lithuanian Economic Forum, Global Latvian Economics and Innovation Forum, Advance Global Australian Summit are just some of the existing best examples of business and networking events. Below the author describes the case of the Irish forum as one of the most vivid and influential examples.

The Global Irish Economic Forum is a biennial conference held in Dublin, Ireland (Picture 2). Inspired by the World Economic Forum in Switzerland.64 Forum participants identified the establishment of a permanent global network of those invited to the first Global Irish Economic Forum at Farmleigh and other influential members of the Diaspora as an important objective. In early 2010, the Global Irish Network was launched and now comprises of over 350 of the most senior Irish and Irish connected business people based in some 40 countries. Network members come from a diversity of fields and have demonstrated a strong connection to Ireland and have a record of high achievement in international business or in assisting in the promotion of Ireland. They provide Ireland with an invaluable resource of

62 Diaspora Direct Investment (DDI) as a Development Tool, IDB

63 Diaspora Direct Investment (DDI) as a Development Tool, IDB

64 Wikipedia Global Irish Economic Forum: https://en.wikipedia.org/wiki/Global_Irish_Economic_Forum

45 international expertise from which we can draw as we work towards economic recovery.65 66

Picture 2. Eamon Gilmore, Bono, Bill Clinton and Enda Kenny in 2011. Photo -- Maxwell Photography.67

Business Matching Service

Establishing a Business-matching portal showcasing a country’s businesses in the priority sectors (such as Offshore Business Services and IT-enabled ventures). This enables Diaspora executives to connect with local companies to conduct business and promote SME internationalization.

GlobalScot is paying a great attention to business matching of the GlobalScot and the companies. Under the service Brokering the ‘supply’ of member expertise with well matched ‘requests (‘demand’) has demonstrated the current and long term potential of investing in the development of a Diaspora based economic development focused

65 Global Irish Economic Forum official website: https://global.irish/GlobalIrishNetwork.aspx

66 Le Journal international.fr : http://www.lejournalinternational.fr/Les-investisseurs- irlandais-se-rassemblent-au-Global-Irish-Economic-Forum_a1321.html

67 Source: http://www.lejournalinternational.fr/Les-investisseurs-irlandais-se- rassemblent-au-Global-Irish-Economic-Forum_a1321.html

46 network. Likewise, evolving GlobalScot to effectively stimulate demand and facilitate the connections on offer remains the central challenge.68

Chart 3. Matching model at GlobalScot.69

A country that has actively and strategically sought to engage with its Diaspora is Scotland, through the GlobalScot program. GlobalScot is targeted specifically at highly skilled professionals. Criteria for membership of GlobalScot include a requirement for members to be influential and active in one of Scotland’s key economic sectors; have a strong affinity with Scotland; be based in a target country location; and be motivated and able to participate.70

SME Technology and Innovation Center

Developing a centre for technology development and innovation to attract entrepreneur and investors is another popular program of engaging Diasporas in

68 M. MacRae and M. Wight The Role of Home Organizations in Home Countries: Globalscot and Scottish Enterprise: http://info.worldbank.org/etools/docs/library/152387/mairimacrae.pdf

69 M. MacRae and M. Wight The Role of Home Organizations in Home Countries: Globalscot and Scottish Enterprise: http://info.worldbank.org/etools/docs/library/152387/mairimacrae.pdf

70 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

47 different organizations. The centre can become a magnet for Diaspora wishing to access the latest technologies, and it facilities a “plug-and-play” environment.71

Venture Capital fund

Some countries of origin should encourage investments in SMEs by launching a public- private-partnership venture fund. This fund can have initial contributions from public sources and encourage Diaspora investors to participate. Similar Diaspora-backed funds in other countries have been very successful in catalysing investments and new venture creation.

Case of Yozma - Israel

Opportunity Recognizing the potential of the Israeli hi-tech industry, the government decided in 1993 to establish a viable venture capital industry and allocated $100 million for that purpose. 72

How it worked Under this program, a collection of funds – Yozma (which means initiative in Hebrew) – was established. Under the Yozma initiative, 10 venture capital funds were formed in partnership with leading foreign venture investors. The total capital of each fund was $20 to $25 million of which the government’s share was 40 per cent and the foreign investors’ 60 per cent.

Key feature A major attraction of the Yozma program was the foreign investors’ option to buy out the government’s share at a pre-agreed price for a period of 5 years. In addition, Yozma was allowed to invest a certain portion of its capital directly.

Success This initiative proved to be extremely successful. Ten venture capital funds were formed with a total of $210 million under management and Yozma itself made 15 direct investments. Nine out of the fifteen direct investments enjoyed successful exits, either through IPOs or through acquisition. The program attracted major international venture investors like

71 Diaspora Direct Investment (DDI) as a Development Tool, IDB

72 Yozma official website: http://www.yozma.com/overview/

Advent, MVP, CMS and Walden from the US, Damier-Benz, DEG, Van Leer Group, TVM from Europe and Oxton, AVX, Kyocera and Vertex from the Far East. It was not surprising that 9 out of the 10 funds exercised their option and bought out the government’s share. From the modest beginning of the Yozma Program, a thriving independent local venture capital industry has been established comprised of close to 80 venture capital funds, with the total capital under management in excess of $10 billion.73 74 Single Window Investment Facilitation

Diaspora members facing bureaucratic hurdles in terms of getting clearances, coordinating with different agencies and company formation can lose enthusiasm. It is important to create a special Single Window office that takes the responsibility of being a unified interface to Diaspora investors and can ensure a smooth investment process.

Mentoring Framework

Within the Diaspora network, the country of origin should develop a mentoring framework. Successful Diaspora members can “adopt” growing businesses and SMEs, provide them mentoring, exchange best practices, and help with accessing technologies to penetrate and grow their share in global markets. Diaspora mentors are very effective in coaching and supporting entrepreneurs/SMEs. Great examples of successful programs in that aspect are TiE, Chile Global, Lithuanian Business Advisors.

Training and Skills Development

Program to promote Student Exchange between Diaspora and home country will encourage cross-pollination of best practices and business ideas. Such programs also create a tighter bond with Diaspora and increase opportunities for them to invest or start a business in their home country.

‘Know India’ program: connecting the head with the heart

Formerly known as the Internship Program for Diaspora Youth, ‘Know India’ is a three- week internship program for Diaspora youth conducted by the Ministry of Overseas Indian Affairs with a view to promoting awareness of India, its socio-cultural diversity, its all-round development, its emergence as an economic powerhouse, India as a

73 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

74 Startup Nation: 5 lessons from Israel: http://www.michipreneur.com/startup- nation-5-lessons-from-israel-at-mpc15/

49 centre of higher education and the ongoing developments in various fields, including infrastructure, information technology, etc. The participants from countries with large populations of People of Indian Origin (PIO) are selected based on recommendations made by Indian missions/posts abroad. They are provided with full hospitality and are reimbursed 90 per cent of the international airfare cost. Feedback below from recent participants in the program demonstrates how effectively it connects the head and heart of Diaspora members.

Create for Lithuania

Kurk Lietuvai (Create for Lithuania) is a one-year work placement programme for young professionals launched by Invest Lithuania in partnership with the Lithuanian Government, aimed at Lithuanian youth who have completed their studies at universities outside of Lithuania.

Each year, a select team of 20 young professionals are chosen to work on strategic governmental projects and to participate in high-level decision-making processes. Three separate four-month rotations in the public sector are tailor-made according to experience and preferences of the participants. At the end of each rotation, the young professionals present their projects to the Lithuanian Government as well as the public.75

As a result those returnees who are part of the Create for Lithuania programme are making a lot of significant contributions to Lithuanian public life. The scheme aims to attract the brightest and best back to Lithuania to work for a year in public sector institutions. In the last three years almost 70 top graduates, all with international experience have shared their knowledge and expertise in public offices including the parliament, government ministries, municipalities and state-run enterprises. Create for Lithuania was initiated by the government investment agency Invest Lithuania, and is currently the only programme focused on providing professional development and the application of best foreign practices in Lithuania.76

Rewarding systems

Awarding is another form of recognizing activity to engage Diaspora is rewarding their accomplishments on the highest level. Here are a few examples.

75 Create for Lithuania Website: http://www.kurklt.lt/en

76 Top young professionals returning to build Lithuania (DELFI, March 14, 2015) http://en.delfi.lt/global-lt/top-young-professionals-returning-to-build- lithuania.d?id=67420680

Now in their eighth year, the World Class New Zealand Awards are one of the country’s most important accolades for outstanding individuals who have made major contributions to New Zealand’s success on the world stage. The annual red carpet, black tie awards hosted by the Prime Minister is attended by 500 New Zealand business leaders.77 Pravasi Bharatiya Samman Awards.

The Pravasi Bharatiya Samman Awards are an expression of honour by the Government of India to members of the Indian Diaspora. The award ceremony has been constituted to acclaim those overseas Indians who have done exceptional work in their chosen field/profession. It has been organized by the Ministry of Overseas Indian Affairs every year since 2003. Pravasi Bharatiya Samman awards are reserved exclusively for non-resident Indians and persons of Indian origin. The awards are conferred on those overseas Indians who have made an outstanding contribution towards fostering better understanding abroad of India and its civilization; for persons who have extended their support to India’s causes and concerns; and for those who made her proud by brilliant performance in their field of merit.

The Advance Global Australian Awards celebrates Australians around the world, who exhibit remarkable talent, exceptional vision and ambition. They are the only awards to recognize the important

77 Kea New Zealand Awards website: http://www.keanewzealand.com/news/celebrate-our-global-best-at-the-2015- world-class-nz-awards

51 contributions of the more than one million Australians living abroad, and for those who have returned home.78

78 Global Australian Advance Awards: http://advance.org/globalaustralianawards/

Initiated by NGO - GLL | Global Lithuanian Leaders and annually patroned by the President of the country, the Global Lithuanian Awards reward the remarkable talent, exceptional vision, and responsible ambition of Lithuanian Diaspora and Lithuania-connected people who have been contributing to the prosperity and global standing of Lithuania.79

“INSPIRE, CONNECT AND ENABLE A BORDERLESS NATION OF ONE MILLION ADVOCATES, CHAMPIONS AND STORYTELLERS”

SLOGAN OF KEA - NEW ZEALAND’S GLOBAL NETWORK80

79 Global Lithuanian Awards website: http://gllawards.lt/

80 Kea New Zealand Awards website: http://www.keanewzealand.com/news/celebrate-our-global-best-at-the-2015- world-class-nz-awards

CHAPTER II. DIASPORA MAPPING: STRATEGY AND TACTICS

RECOMMENDATIONS FOR IDENTIFYING THE DIASPORA

1. METHODOLOGY RECOMMENDATIONS FOR MAPPING THE DIASPORA

In order to get a complete understanding of the Diaspora footprint and to capture its demographic information we need to develop a Diaspora mapping strategy. This is an important field, which needs to be researched to develop further targeted programs.

In a four – step process of Diaspora Networking by Kingsley Aikins, Research is the number one step. It is later followed by Cultivation (the process of “moving people from a state of unawareness to informed understanding, sympathetic interest, engagement, commitment and, finally, passionate advocacy”) Solicitation (asks and tasks for Diaspora) Stewardship (thanking and recognizing the contributions made by Diaspora members to the homeland).

Therefore, this chapter focuses on the first step of Diaspora networking process. It explains how to find and identify, categorize and analyze the target Diaspora.

1.1. RESEARCH FOR PROSPECTS

“ONE CANNOT OVERESTIMATE THE ROLE OF INDIVIDUALS IN MOBILIZING THE DIASPORA. INDIVIDUAL CHAMPIONS MAKE CONNECTIONS, ALLAY SKEPTICISM AND PROPOSE PROJECT IDEAS. MANY DIASPORA INITIATIVES WERE UNSUCCESSFUL BECAUSE THEY FAILED TO IDENTIFY SUCH CHAMPIONS.”

YEVGENY KUTZNETSOV “LEVERAGING DIASPORAS OF TALENT: TOWARD A NEW POLICY AGENDA” 81

81 Diaspora Networks and the International Migration of Skills: How Countries Can Draw on Their Talent Abroad. WBI Development Studies by Yevgeny Kuznetsov, June 2006. Available at http://siteresources.worldbank.org/EDUCATION/Resources/278200- 1126210664195/1636971-1126210694253/Leveraging_Diasporas_Kuznetsov.pdf

As previously noted, it is important to know that quite often it is a small part of the overall number of the Diaspora who make a difference for the home economy and society, and it is important to research who exactly these members are. As suggested by Kutznetsov, “One cannot overestimate the role of individuals in mobilizing the Diaspora. Individual champions make connections, allay scepticism and propose project ideas. Many Diaspora initiatives were unsuccessful because they failed to identify such champions.”82

Good prospect research helps one to determine, evaluate and qualify the people who will become leaders within a Diaspora initiative. Prospect research is ideally about receiving as much information as possible to decide the right time, project, setting and person to ask to become an ambassador within the Diaspora. The aim is to create an active prospect list.

You do this by ‘rating and screening’ each prospect for his/her capacity and propensity to engage in a Diaspora initiative. Take, for example, the amount of attention to research in the Global Scot network.

Membership of the network is by invitation only, as it insists on top standards in order to maintain its reputation as a world-class resource for Scottish businesses. The International Networks Team in Scottish Enterprise then assesses nominees according to their personal achievements, standing in their industry, and ability to contribute to the industry sectors that have been identified as important to Scotland’s future growth. Following successful evaluation, an application will then be forwarded to the First Minister of Scotland, who, upon approval, will write personally to the invitee, officially asking him/her to join the Global Scot network.

It is crucial to determine the process of identification as a priority in the whole networking process. While looking for most effective means to identify Diaspora it is important to tap into technology.

82 Diaspora Networks and the International Migration of Skills: How Countries Can Draw on Their Talent Abroad. WBI Development Studies by Yevgeny Kuznetsov, June 2006. Available at http://siteresources.worldbank.org/EDUCATION/Resources/278200- 1126210664195/1636971-1126210694253/Leveraging_Diasporas_Kuznetsov.pdf

1.2. TAPPING INTO TECHNOLOGY

Nowadays technology allows countries to connect with their Diasporas at a massive level. The possibility exists to create a global digital portal to include great numbers of Diaspora members and Diaspora related organizations. Such websites enable individuals and groups to connect with the homeland and with each other. This new connectivity explored by a digital Diaspora is having a major impact on national image building and economic development in different countries. However, it is important to note that technology does not substitute for face-to-face interactions – Diaspora networking is based on contacts. Web technologies, such as blogs, wikis and social networking media, are playing an important role in enabling the digital Diaspora in countries around the world. Aikins sets an example of Tourism Ireland launched campaign with a difference to connect with the Diaspora throughout Britain in 2010. The campaign called “My Irish 140” – encourages people with Irish ancestry, and those who feel a connection with Ireland, to explore that connection and talk about it in their Twitter stream.

LinkedIn is home to a number of large online Diaspora groups such as the Chinese- Speaking & China-Experienced Business Executives, IIT Alumni LinkedIn Group and the Brazilians Abroad Network Group.

Furthermore, a number of countries are now creating online platforms to connect with their Diaspora communities. For example:

 Overseas Singaporean Portal aims to engage Overseas Singaporeans, of which there are over 140,000, to connect them back to Singapore and with each other.  One Vietnam Network is the first online global network for the worldwide Vietnamese community;  Global INK is a secure portal providing a framework of moderated online communities to harness knowledge catering to different focus areas of the Indian Diaspora;  Rendezvous is an Irish focused social networking website geared towards helping users find common interests and connect;  Jamaica Diaspora Connect has been developed to connect members of the Jamaican Diaspora with each other and with Jamaica, and it is funded under the European Commission-United Nations Joint Migration and Development Initiative;  Yabiladi (‘My Country’ in Arabic) is one of the most popular internet portals established by a group of Moroccan Diaspora members to foster connections among the Moroccan community.

Some of them are integrating social media with their own created platform. This is the case of Global Lithuanian Leaders e-platform, where members can login using their LinkedIn or Facebook identities.

User-friendly and content rich platform could be one mean for identifying and attracting Diaspora prospects. That is especially relevant for the “Net” generation of New Diaspora.83

1.3. THE DIGITAL GENERATION OF THE DIASPORA

Digitalization and technology is a key way to connect with the Next Generation Diaspora. Aikins suggests defining and distinguishing characteristic of the ‘net generation’ as these born between 1977 and 1997, more often described as generation Y, is the much more varied media diet they have compared to their parents. They digital Diaspora don’t pensively watch one form of media but actively engage using many – computers, cell phones, iPads, televisions, etc. They use these media simultaneously and do not just observe but also participate. For Diaspora organizations to access this target they need the technology and skills and they need to engage in two-way relationships and realize that their information is going to be moved around through clicking, liking, posting, sharing and linking to other material. Social networking sites allow people to share information rapidly and extensively. Therefore, many Diaspora include sections for blogs, discussion forums, listings of events and job opportunities. They also have a presence on such social networking platforms as Facebook, LinkedIn, Twitter, Xing or other.

83 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

2. SOURCES AND MEANS TO IDENTIFY TARGET

2.1. SOURCES TO IDENTIFY DIASPORA

Accurate and reliable information on the Diaspora is an essential baseline for the development of effective, Diaspora-friendly policy and the creation of Diaspora- centric programs. It is also important to differentiate with the sources for identifying Diaspora. It is advisable to define Diaspora as broadly as possible, but still keep the definition relevant for the economic context. Below is the suggested definition by the author.

Professionals (such as industry leaders, world-class achievers, entrepreneurs, mid- career professionals, young leaders, students), connected by the sense of homeland Latvia (incl. Diaspora types such as Lived, Ancestral, Next generation, Affinity, Returning and Globetrotter) potentially able to contribute for the purpose of investment promotion and economic development in Latvia. Information sources might include the following:84

 Ministry of Foreign Affairs, Consulate Offices, Network of Honorary Consuls;  Ministry of Economy;  Ministry of Education;  National Statistics offices;  Employment and executive search agencies;  National Associated Business organizations and their representatives abroad;  Bilateral Chambers in home-country and abroad;  Professional and business international clubs;  OECD database;  Foreign Country Events;  Local Chapters of Diaspora networks;  Social media (i.e. LinkedIn, Twitter, Facebook);  Foreign Universities;  Global Business Databases;  Global Patent and Innovation Databases;  Other.

84 Diaspora Direct Investment (DDI) as a Development Tool, IDB (2011)

2.2. MEANS OF MAPPING TARGET GROUP

There are two main means to map the Diaspora. One of them is by attracting Diaspora with a relevant cause. Those prospects could be defined as “warm” contacts. These people are usually willing to engage and further contribute. Another mean of Diaspora identification works by identifying “cold” contacts while working with big data. This sub chapter will give an overview of both. The first method focuses on the already existing motivated Diaspora. Since they are pro-active prospects, they are more likely to engage. This contact may be typically reached by cooperating with existing formal and informal Diaspora organizations, business chambers and other associated structures. It can also be attracted by organizing events, network, engaging programs and other activities. This mean may lead to developing into a snowball effect in case of successful network activities. Members or participants, whose needs are met, attract even more members. This “warm contact” method, which has already been mentioned in the previous sub- chapter on technology, can work through identifying and attracting Diaspora prospects by creating user-friendly and content rich platforms. Even though it requires more efforts, this is the most organic way of identification. It can be reached by tapping into and analyzing:

 Member lists of existing formal and informal Diaspora networks;  Databases of governmental institutions;  Participant lists of business events attended by Diaspora;  Other.

Another mean of Diaspora identification works by identifying “cold contacts” mining the “big data”. This method uses different databases of possibly untapped potential. The further networking process of the contacts there may not always end in success; therefore it requires more efforts to engage them. However, the successful prospects mapped by using this method can potentially cause a greater effect in many cases.

One way of looking at data mining in order to identify targeted Diaspora is through the applied onomastics. Onomastics - is the study of the origin, history, and use of proper names. Onomastics can be helpful in data mining, with applications such as named-entity recognition, or recognition of the origin of names.85

Here it is useful to analyze the case of using of a professional tool engaging onomastics. For example, a European company called NamSor provides with of name

85 “Onomastics” by Wikipedia available at https://en.wikipedia.org/wiki/Onomastics

59 recognition software. A tool helps to understand international flows of money, ideas and people. It is a piece of sociolinguistics software that helps to mine the “big data”. NamSor helps answer the perennial question all countries ask about their Diasporas – who are they, where are they and what are they doing. By demonstrating some showcase, stories of NamSor this sub-chapter will reveal the opportunity that lies in the method of using onomastics.

After successful projects in the field of FDI, NamSor launched @FDIMagnet, a consulting offering to help Investment Promotion Agencies leverage a Diaspora to connect with business communities abroad and attract Foreign Direct Investments.

NamSor helps solving the challenge, which is typical to Investment Promotion Agencies as most difficult task - to identify leads of FDIs. Recognizing international names can be used to implement effective Diaspora Marketing and Smart Investor Targeting. NamSor offers two different types of building the Diaspora lists:

 Diaspora Direct Investments (DDI) is relevant for countries that can leverage a Diaspora or a significant cultural influence in the world;  Smart Investors Targeting is relevant for any country willing to attract Foreign Investors.

Diaspora Direct Investments (DDI) NamSor proposes to help Investment Promotion Agencies recognize who in the Diaspora could be leveraged to attract FDIs. The deliver a list of names qualified in line with the IPA's specific targets, as well as statistics. Below you will see the work methods used to identify “cold contacts” as potential FDI leads.

Data / Source Value Proposition Volume & Parameters

Factiva Dow Identify board-level top managers, Factiva Companies & Executives Jones / Dun & in the Diaspora, including those not (FCE) or ORBIS (D&B) covers necessarily socially very active (i.e. over forty million individuals. Bradstreet not on LinkedIn, not Community (ORBIS) events etc.) within target Start from a clear scope in Country/Sector. terms of Region / Sector / Companies / Company Size. Rationale: International company directors with origins/personal link with the country are more likely to act as (1)

facilitators of FDI or (2) referrals of top level contacts in a particular.

Region/sector (ex. US Automotive, UK Banking etc.).

Open Similar to D&B, but has less of Open Corporates is the largest Corporates information about the company. open database of companies in the world, with over 84 million companies listed.

Twitter Identify Thought Leaders/Opinion Twitter has over two hundred Leaders in the Diaspora that could million active users. Pricing is act as influencers to promote the based on three parameters: (1) Country Image in a particular the effort to extract the initial Region/Sector, towards a particular scope of data, which involves Audience. Rationale: Thought usually a special programming Leaders/Opinion Leaders with on the Twitter APIs and a origins/personal link with the duration to extract the data country are more likely to 1) read a (human & machine time) (2) the tweet, a linked article 2) possibly number of base names endorse a positive message about extracted (3) estimation of the the country and retweet 3) be number of names in output. followed by other Thought Leaders/Option leaders interested in the country/topic who can - again- retweet.

@AngelList Identify entrepreneurs / start-up @AngelList lists over 1,500,000 professionals / VC / Business Angels profiles of the global start-up in the Diaspora to 1) Develop a local ecosystem. Most profiles start-up ecosystem, from include Twitter and LinkedIn accelerator to industrial cluster 2) contact information. Pricing is Encourage Diaspora Seed based on two parameters: (1) investment links and streamline the number of base names financing 3) Build up expert extracted (2) estimation of the networks Rationale: Currently, over number of names in output. 70% of investors in Indian start-ups have Indian names; over 70% investors in French start-ups have French names. Women’s networks

are also essential to finance start- ups created by women and close the entrepreneurship gender gap.

Crunch Base Crunch Base is the definitive ~150,000 profiles of the global database of the start-up start-up ecosystem (~50% ecosystem.’ Similar to @AngelList. overlap with @AngelList).

Thomson Identify critical connections Thomson WoS is one of the WoS, ORCID, between scientific networks and leading scientific databases, PubMed, business networks. Rationale: For with millions of authors and RePEc, DBLP example, in Life Sciences, scientific papers published MedTech/Biotech most top every year. ORCID is the leader executives in large companies as open database for identifying well as start-ups are scientists scientists in scientific themselves. publications. PubMed/PMC is a database focused on Medical Research & Life Sciences with over 3 million scientists and 12 million publications. RePEc contains bibliographic data about 40k of the world’s top economists. DBLP is a scientific database focused on ICT / Computer Sciences.

Table 1. NamSor FDIMagnet Service Outline Brochure.86

Smart Investor Targeting

Some countries do not have a Diaspora or significant cultural footprint abroad that can leveraged. However, recognizing international names of the Foreign Investors they would like to attract can prove as much useful. One idea is to recognize the network of expatriates already active in the country and leverage the 'happy investors' and their network at home or internationally. Another idea is to reinforce the existing communication channels established to promote the country internationally, retargeting more accurately a particular audience (ex. the Japanese, the Chinese, the Russian, etc.). Namsor can help IPAs grow their visibility, with a

86 NamSor FDIMagnet Brochure (Paris, 2015)

62 particular audience or recognize potential Foreign Investors / Referrals in various databases by their international name.

Lithuanian investment agency worked with NamSor to filter data from millions of meaningless elements to a few dozen actionable names. Domas Girtavicius, a senior consultant at Invest Lithuania, said "we were impressed by the accuracy of the name recognition software: it reliably predicts the country of origin and the number of false positives is fully manageable". Elian Carsenat, the founder of NamSor, said "searching for names in the Big Data is like seeking a gold needle in a haystack: doable once the right tool exists".

Below you can find an example of data presentation by NamSor that analyzed 500,000 names of C-level executives in the European Union to identify British and Irish last names.87

87 “Engaging the Irish Diaspora, as Ambassadors of Invest in Ireland” by Elian Carsenat, NamSor Applied Onomastics (Paris, 2015)

Chart 1. Union British and Irish last names identification in the Database of C-level executives in the European88

Below you can find another example of identifying entrepreneurs, start-up professionals, VC, Business Angels in the Diaspora. Here is the sample list of Irish Angel and Investors to Ireland in 2014.

Table 2. Irish @AngelList and Investors to Ireland Sample 2014.89

NamSor has a track record of successful lead generation projects to identify non- captive FDIs via Diaspora Marketing as well as profiling and Direct Targeting of Foreign Investors.

After identifying the Diaspora prospects, the next step of categorizing follows. The next sub-chapter elaborates on the tactics of building Diaspora registry.

88 “Engaging the Irish Diaspora, as Ambassadors of Invest in Ireland” by Elian Carsenat, NamSor Applied Onomastics (Paris, 2015)

89 “Engaging the Irish Diaspora, as Ambassadors of Invest in Ireland” by Elian Carsenat, NamSor Applied Onomastics (Paris, 2015)

3. TACTICS OF BUILDING DIASPORA REGISTRY

The approach to Diaspora prospects is similar to the approach of identifying fundraising prospect. Prospect researchers are advised to conduct research to evaluate a prospect's ability to give, also called capacity (how much the individual is worth) and warmth toward the organization, a.k.a. affinity or propensity (how close the prospect feels to the organization). Prospect researchers may also analyze data in a donor or constituent database to identify new potential major donors or to predict which groups of constituents are most likely to make major gifts.90

When talking about capacity, one can divide levels of data to identify into vertical and horizontal information.

The horizontal information includes such standard demographic and status based factors as Name, Age, Location, Qualification and Occupation. While the vertical data includes information about Industry, Skills and Expertise, Networks and Affiliations as well as Leadership roles, Political – Industry influence, Investors and High Net worth.

Chart 2. Levels of Data to Identify. 91 In parallel, propensity is a measure of belongingness, or how well a particular person matches the profile of your organization. The more closely a particular person's demographics, socioeconomics, and psychographics align with the rest of your donors, the higher the Propensity score.92

90 “Prospect research” by Wikipedia available at https://en.wikipedia.org/wiki/Prospect_research

91 “Donor impact” on Propensity to Give available at http://www.analyzeimpact.org/propensity

92 “Donor impact” on Propensity to Give available at http://www.analyzeimpact.org/propensity

Discovering and evaluating prospective Diaspora members, their interests, relationships, inclination to give back and their capacity is a key starting step of the relationship management process that can assure success engaging Diaspora.

CHAPTER III. DIASPORA ENGAGEMENT FOR THE ECONOMIC DEVELOPMENT OF LATVIA

OPPORTUNITY ANALYSIS FOR LATVIA

1. LATVIAN DIASPORA STATUS QUO AND POTENTIAL

Having analysed Diaspora opportunities being tackled by different governments, NGO’s and private initiatives in many countries globally, it is time to focus on Latvia. The previous analysis allows a deeper interpretation of country – specific information on Diaspora within broader contextual understanding. Knowing the major definitions and classifications of Diasporas and types of their engagement, helps analysing Latvian Diaspora more efficiently. So does the outlining of the best global cases of actions and policies devoted to efficiently target Diasporas around the world.

This chapter includes the overview of the current figures of Latvian Diaspora with a separate focus on the existing policies to engage into economic life of the home country. A large part of attention will go to existing cases of Diaspora engagement in the development of the country, existing formal and informal networks, professional groups, initiatives and more. That will lead to the conclusions of further steps that are important to undertake to efficiently reach for the main goals of Diaspora involvement.

To sum up, the paper will analyse the nature of the Latvian Diaspora and return migrants as well as related challenges and opportunities. It will further analyse what policies are in place to address them. Finally the paper will provide further perspectives – what lessons and recommendations can be drawn for Latvia.

1.1 . OVERVIEW OF LATVIAN DIASPORA STATUS QUO AND POTENTIAL

1.1.1. LATVIAN DIASPORA: CHANGING DEFINITIONS AND HISTORY

The meaning of "Diaspora” has been going through significant changes over the years in Latvia. Earlier approach of the Government’s Latvian Diaspora Support Programs was focused on the need to only think of the exile Latvian society. The policy has been shifting with a growing need to talk about the "old" and the "new" Diaspora, namely with regards of emigration that took place until 1990 and the recent emigration.93

Earlier public discourse spoke of “emigrants” and that was mainly the rhetoric which looked at people who had escaped the war or authoritarian systems during different historical periods. Sometimes, the Diaspora was referred to as “world Latvians” or “foreign Latvians”, using a euphemism. However, the very fact that at various times Latvians living outside Latvia have been called differently, tells that there are several generations of Diaspora Latvians. The historical past and reasons for leaving Latvia have been different.

Latvians have been leaving the current national territory even before the state of Latvia was established. Researchers can find descendants of old settlers (end of 19th century) in Russia, people who were looking for opportunities to farm. In the early 20th century many Latvians were leaving for Latin America and Australia in a hope of finding better life. The next biggest wave of emigration was the World War I, with its huge wave of refugees going mainly eastwards. Many of the refugees returned when free Latvia was established, but many descendants are still there, in Russia, the Ukraine and the Caucasus.

The World War II brought a fatal loss to Latvia, around 200 000 people, whole families, fled to the West at the end of the war. After Displaced Persons’ camps in Germany they moved all over the globe, settling mainly in the USA, Canada, Sweden, Germany, Great Britain and Australia. Latvians not only adapted there, but also organized themselves in order to practice the Latvian culture, education and civic-political activities.

During the soviet regime, people did not leave the country extensively, because the borders were closed. The newly gained freedom in the early 90’s opened borders and have also caused a third wave of emigration for many reasons. Many young school leavers have found scholarships in Western universities and better jobs after

93 Diaspora Policy in Latvia MFA, 2015: http://www.mfa.gov.lv/en/policy/2014-12- 22-11-41-00/diaspora-policy-in-latvia

68 graduation, the free labour market lured people to places with higher living standard.94

A large number of emigrations are interpreted in public mainly as threat to Latvia with a demographic crisis, as well as creates shortage of labour and that of intellect. The next sub-chapter will look deeper to the numbers and geographies of the current Latvian Diaspora.

1.1.2. LATVIAN DIASPORA: NUMBERS AND GEOGRAPHIES

According to the estimates by the Latvian Ministry of Foreign Affairs about 370, 000 Latvian nationals are permanently residing outside Latvia, most of them having emigrated in the past decade (in approximate figures, there exist considerable differences between the data quoted by the Population Register, foreign authorities, and diplomatic missions). Part of these people have also left the Latvian territory since the late 19th century during several waves of emigration, before the First World War, after the Second World War, during the Soviet occupation and following the restoration of independence. That has been already elaborated on the previous sub- chapter. CSB data shows that during the period from 2000 to 2011 a decrease in the population due to emigration is around 212 thousand persons. The official statistical data mainly focuses on the latest new generation Diaspora and provides the number of 220 000 which equals the amount of people left the country in the last 15 years. (see Table 1.)

According to the Latvian CSB in May 2014, Latvia had 1,997,500 inhabitants (compared to 2.38 million in the beginning of 2010). Population reduction by 382,500 inhabitants has been caused by various reasons including demographic, political as well as economic ones. (see Table 1.)

As noted by the Ministry of Foreign Affairs, since 2011, positive trends have been observed. According to the Latvian Central Statistical Bureau (CSB), emigration has decreased, and the numbers Latvian citizens and ‘non-citizens’ returning to Latvia are growing. 95 It is important to note that that statistics of Net Migration in Latvia was severely affected by the residence permit program. It attracted thousands of

94 Latvian Diaspora, Latvia.eu: http://www.latvia.eu/fr/blog/latvian-diaspora

95 Diaspora Policy in Latvia MFA, 2015: http://www.mfa.gov.lv/en/policy/2014-12- 22-11-41-00/diaspora-policy-in-latvia

69 foreigners to Latvia. However, the immigration department reveals that less than a fifth of those taking part in the residence permit program have been settling permanently in Latvia.96

96 Spiegel “EU Immigration: Only the Rich Are Welcome” By Claus Hecking (2013) available at http://www.spiegel.de/international/europe/immigrants-buy-visas-in- latvia-as-europe-locks-out-the-poor-a-926543.html

Long term migration

Years Immigration Emigration Net migration Migration within the country

1951 - 1960 639 880 459 832 180 048 843 113

1961 - 1970 476 934 335 872 141 062 929 657

1971 - 1980 548 643 428 235 120 408 897 802

1981 - 1990 506 576 423 953 82 623 717 759

1991 14 684 29 729 -15 045 49 988

1992 6 199 59 673 -53 474 45 972

1993 4 114 36 447 -32 333 37 046

1994 3 046 25 869 -22 823 39 781

1995 2 799 16 512 -13 713 39 266

1996 2 747 12 828 -10 081 39 365

1997 2 913 12 333 -9 420 39 219

1998 3 123 8 874 -5 751 38 729

1999 1 813 5 898 -4 085 36 983

2000 6 483 22 911 -16 428 ...

2001 5 376 24 539 -19 163 ...

2002 6 642 15 837 -9 195 ...

2003 4 063 15 647 -11 584 ...

2004 4 844 20 167 -15 323 ...

2005 6 691 17 643 -10 952 ...

2006 8 212 17 019 -8 807 ...

2007 7 517 15 463 -7 946 ...

2008 4 678 27 045 -22 367 ...

2009 3 731 38 208 -34 477 ...

2010 4 011 39 651 -35 640 ...

2011 10 234 30 311 -20 077 ...

2012 13 303 25 163 -11 860 ...

2013 8 299 22 561 -14 262 ...

2014 10 365 19 017 -8 652 ...

Table 1. Long term migration of Latvia.97

97 Source: Central Statistical Bureau of Latvia available at: http://data.csb.gov.lv/pxweb/en/Sociala/Sociala__ikgad__iedz__migr/IB0010.px/tab le/tableViewLayout1/?rxid=a79839fe-11ba-4ecd-8cc3-4035692c5fc8

Latest CSB data (see Table 1. above), containing the data as Latvian living abroad shows that in 2013 the number of emigrants has decreased in comparison to the highest wave of emigration flows of the year 2008 to 2011. Emigration flow remains negative and is more or less back to the level of the one in 2003 to the 2004.98

Picture 1. International Migration Directions from Latvia.99

At the same time, the Latvian Diaspora abroad is increasing. The largest Latvian communities are those in the U.K., the USA, Canada, Ireland, Sweden, Australia, Russia, Brazil, Germany, Belgium, Israel, Norway, and Spain. Latvian Ministry of Foreign Affairs elaborates that at present, most of the Latvian community is in the UK (~ 100 000) and the USA (96,000 residents of Latvian origin, of which around 15 000 are Latvian citizens). The smaller number are in Canada (~ 26 000), Ireland (25,000 to 30,000), Sweden (~ 30 000), Australia (~ 25 000), Russia (~ 20 000), Brazil (20 000),

98 Diaspora Engagement Plan „Par sadarbību ar Latvijas diasporu 2015. – 2017. gadam” projekts (izsludināts Valsts sekretāru sanāksmē 2014.gada 17.jūlijā) anailable at http://www.mfa.gov.lv/arpolitika/diasporas-politika/dokumenti

99 Ilona Kiukucāne, adviser, Permanent Delegate to Business Europe How to Improve Intra-European Mobility and Circular Migration? Fostering Diaspora Engagment? (Riga, 2015) available at https://eu2015.lv/images/Kalendars/MFA/Ilona_Kiukucane_LDDK_Migrac_1105201 5.pdf

Germany (~ 30 000), Norway (~ 11 000) and Spain (~ 7000). 100 Above you can find a visualisation of International Migration Directions from Latvia provided by the Ministry of Environmental Protection and Regional Development of Latvia (see Picture 1.).

An alternative statistics providing the European migrant stocks by World Bank (see Chart 2.) below shows that the numbers slightly vary, but the tendencies are the same. The estimates of migrant stocks in 2013 to the EU countries were 153, 000 inhabitants.

Chart 1. Migrant stocks from Latvia by Destination country by World Bank. 101

Having in mind the dominating negative migration trend, it is important to notice that emigration severely affected regions to shrink and made cities, especially Riga, to grow. This trend is highly affected by the global urbanization tendencies. Next sub- chapter will elaborate more on that subject and how it reflects in the case of Latvia.

100 Diaspora Policy in Latvia by MoFA of Latvia, 2015: http://www.mfa.gov.lv/en/policy/2014-12-22-11-41-00/diaspora-policy-in-latvia

101 Ilona Kiukucāne, adviser, Permanent Delegate to Business Europe How to Improve Intra-European Mobility and Circular Migration? Fostering Diaspora Engagment? (Riga, 2015) available at https://eu2015.lv/images/Kalendars/MFA/Ilona_Kiukucane_LDDK_Migrac_1105201 5.pdf

1.1.3. URBANIZATION IN LATVIA: MOVING TO THE CITIES

The population of Latvian regions has been decreasingly shrinking, while migration tendencies made cities, especially Riga, grow. This trend is seen as the global urbanization tendency. This sub-chapter will elaborate more how it reflects on Latvia. Figure 1. Urbanization Trends and Predictions 1950 - 2050 According to the United Nations, more than half the world's population is now living in cities, as people move for jobs, education, and better services. By 2050, 70 percent of the world's population is expected to be urbanized. It estimated that in 2030 this number would swell to about 5 billion (see Figure 1.). The urbanization unfolding is bringing huge social, economic and environmental transformations.102

The world is experiencing the largest trend of urban growth in history. The urbanization is bringing huge social, economic and environmental changes. Urbanization has the potential to trigger a new era of well-being, resource efficiency and economic growth.103

102 Amid mass migration to cities, Bolivians learn to adapt to urbanization by CSMonitor (2009) available at: http://www.csmonitor.com/World/Americas/2009/0212/p04s01-woam.html 103 United Nations Population Fund, Overview available at http://www.unfpa.org/urbanization

Picture 2. Relative change of population in Latvia 2000 – 2014.104

The same global trend reflects in separate countries, people moving from suburbs to larger cities. Above you can see the change in demographics in Latvia in 2000-2014. There has been a clear depopulation of the regions and increase of population of Riga (see Picture 2.). This is how migration effected regions to shrink and made cities to grow.

1.1.4. NEW GENERATION MIGRANTS OF LATVIA

A large part of the population moved from Latvia to other countries over the past 15 years is the one of youth and children. The youth migrant group that is aged between 16 and 25 more often move abroad as school or university students, looking for better education and broader opportunities. Some of them having faced difficulties in Latvia like covering monthly expenditures, lacking job opportunities.

Therefore they choose entering the labour market and continuing their education abroad. Further education or entering the labour market pushes youth to integrate in

104 Ilona Kiukucāne, adviser, Permanent Delegate to Business Europe How to Improve Intra-European Mobility and Circular Migration? Fostering Diaspora Engagment? (Riga, 2015) available at https://eu2015.lv/images/Kalendars/MFA/Ilona_Kiukucane_LDDK_Migrac_1105201 5.pdf

76 local social activities of the destination country. It has been researched that they maintain a strong emotional link with the homeland. Virtual communication can be described as intensive.

Young parents of children under the age of 18 are also more likely to have emigrated due to lack of stability in Latvia and concerns about financial security in the future. They try to integrate into the local labour market of the host country and gain stable income.

The majority of youth sustain links with Latvia, especially with family, relatives, friends and acquaintances through various remote communication channels daily or several times a week. Most frequently, they use online technologies and visit Latvia when possible. Usually during holidays like Christmas, Easter or summer holidays. Latvian news portals, TV and radio are used regularly by youth who live abroad.

However, there is a significantly lower active participation and interest among youth in Latvian Diaspora events, which could be essential for sustaining links with Latvia.105 The youth abroad also usually miss chances to network with the home market of potential employees or other contacts and loose links to receive informal information on career possibilities back in Latvia.

The next sub-chapter will touch upon the potential of returning migrants. It will particularly focus on the New Generation Diaspora, since that group is more likely to still decide to come back.

1.1.5. THE POTENTIAL OF RETURNING MIGRANTS

Researchers reflect on the main reasons to return of the New Generation Diaspora that might include various return-migration models such as returning due to unsuccessful migration experience; returning as a success story; returning in old age. The very relevant approach, which especially targets the New Generation Diaspora, is the Trans-nationalistic approach where returning does not mean the end of the migration cycle with transnational contacts and activities maintained.

105 Geographical mobility of youth: communication and links to Latvia by Elīna Apsīte-Beriņa un Ģirts Burgmanis (2015)

Picture 3. How many plan to return (those who emigrated in 2000 and later)?106

According to the research of Inta Mierina “Return Migration to Latvia: Problems, Policies, Perceptions and Perspectives” the reasons for returning are almost always non-economic. Below you can find the list of reasons that are important to the recent, post 2000 migrants, it is a very important factor: 107

• Family and friends in Latvia. 47% of the survey participants revealed this as major reason for them to consider coming back.

• Missing Latvia. 29% of responders say it is very important.

• Latvian language. 19% of responders say it is very important.

106 Inta Mierina “Return Migration to Latvia: Problems, Policies, Perceptions and Perspectives (2015)

107 Inta Mierina Return Migration to Latvia: Problems, Policies, Perceptions and Perspectives (2015 Riga) available at https://eu2015.lv/images/Kalendars/MFA/Inta_Mierina_Presentation_Riga.pdf

• Inability to integrate. They do not want to live as strangers, outsiders, ‘lower classes'.

• Re-evaluation of values. The gains of emigration do not seem significant enough to stay abroad.

• Concern for children. Usually language and culture related concerns.

• Better financial situation. They overcame their financial difficulties (eg. loans) or fulfilled their aims.

• Planning to start business in Latvia. Developing entrepreneurial ideas to implement home.

The research also reveals the reasons that prevents from returning of particularly those who left in 2000 or later. The reasons include:

• Lack of a decent job offer and opportunities for growth. 85% of responders think that their chances of finding a job that pays adequately are poor. About a half of those for whom finding ‘a decent job’ is a problem could be attracted with a net salary of 1000 EUR. Contacts mater a lot, so in some ways their position in the labour market is weaker.

• Instability and weak social guarantees.

• Lack of a home where to return. Currently about a half have a dwelling in Latvia. Only a few municipalities offer help.

• Access to children education. Ensuring children a place in a kindergarten, and successful integration of school-age children in the Latvian school system.

•Lack of belief in a positive and stable development of the country.

The above reasons are important to take into consideration while targeting the New Generation Diaspora.

1.2 . LATVIAN DIASPORA’S EFFECT ON ECONOMY The positive effects on Latvian economy by its Diaspora can be analysed using the official statistical data (like the amount of remittances or annual DDI estimates) as well as show-casing examples of already existing effects on the core fields of impact, such as exports and entrepreneurship promotion, skills and knowledge transfers or other. The next sub-chapters will focus on both: the data overview and analysis of remittance and DDI as well as the case examples of Latvian World Class Achievers, Change Agents, First Movers, Tipping Agents, Career Returnees and Remote Mentors.

1.2.1. REMITTANCES: LATVIANS SENDING MONEY HOME The most obvious effect to home economies is the remittances sent by people living abroad. The report by the International Monetary Fund says, that partly triggered by emigration, migrants’ remittances to Latvia have considerably grown over the last two decades. From a level in 2000, remittances have steadily grown to more than half a billion euros. Over the period, remittances have generally increased faster than GDP and private consumption, including in the aftermath of the financial crisis. The ratio of remittance inflows to GDP has exceeded 2.5 percent of GDP.

However, Latvia’s dependence on remittance inflows remains low by international standards. Latvia’s ratio of remittance inflows to GDP is low compared to the largest recipients of remittances in the world, including European countries such as Moldova (25 percent of GDP in 2013), Kosovo (16 percent of GDP), and Georgia (12 percent of GDP).108

“Latvia is the second largest recipient of remittances among Baltic countries, after Lithuania (Figure on the right). Remittances to Latvia come almost entirely from individuals who stayed abroad for a short period. A large part of remittances to Latvia comes from compensation of employees, which comprises mostly remuneration of residents working abroad (Latvians who stayed abroad for less than one year). Workers’ remittances and migrants’ transfers represent less than 7 percent of total remittances, suggesting that individuals who stayed outside Latvia for one year or longer do not

108 IMF Country Report 2015 May, No. 15/111 : Latvia available at https://www.imf.org/external/pubs/ft/scr/2015/cr15111.pdf

80 remit much or use informal channels since 2010.

The large part of remittance inflows are from Latvians staying in large European countries and North America (Figure on the right). Inflows from the United Kingdom are the largest, representing 52 percent of compensation of residents working abroad, followed by inflows from Ireland, Germany, and Norway. Inflows from the United States represent 14 percent of compensation of residents working abroad. These countries also host large Latvian communities. Remittances from the other two Baltic countries are small. Various factors may have influenced the magnitude and geographical distribution of remittance inflows, including immigration policies and economic conditions in host countries (e.g., GDP growth and growth differential between host countries and Latvia) and the profile of migrants (e.g., skill level, marriage, age, and ties with the home country). In the case of Latvia, it is hard to find analytical evidence of these effects because of data scarcity.” 109

The data provided by the World Bank demonstrates the same tendencies (Chart 2.). Here you can see the remittances sent from the EU countries only, where the Top 5 countries are UK, Ireland, Germany, Lithuania and Sweden.

109 IMF Country Report 2015 May, No. 15/111 : Latvia available at https://www.imf.org/external/pubs/ft/scr/2015/cr15111.pdf

Chart 2. Remittances to Latvia and Sending Countries in 2014.110

According to IMF, Macroeconomic effects on Latvia by remittance inflows are the following:

 strengthen Latvia’s balance of payments stability by providing stable and countercyclical inflows of private capital, which has partly mitigated the volatility of other capital flows in particular since the financial crisis.  Remittances are also less volatile than other private capital inflows, including FDI, and portfolio and other investment inflows. Remittance inflows remained stable during the financial crisis, decelerating only slightly also reflecting an increase in emigration flows out of the country.  Remittances have represented a large share of private capital inflows since the crisis, even higher than foreign direct investment in some years.

110 Ilona Kiukucāne, adviser, Permanent Delegate to Business Europe How to Improve Intra-European Mobility and Circular Migration? Fostering Diaspora Engagment? (Riga, 2015) available at https://eu2015.lv/images/Kalendars/MFA/Ilona_Kiukucane_LDDK_Migrac_1105201 5.pdf

 Remittance inflows can also support economic growth and increase households’ living standards. o Remittances increase financing available for consumption and investment, and reduce dependence on foreign capital including foreign direct investment. o In Latvia, remittances are stable and countercyclical, which can increase their beneficial impact on growth. o Remittances are directly targeted at households, helping raise standards of living and reduce poverty.

However, these beneficial effects could be (at least partially) offset by the negative impact of remittances on recipients’ incentives to work and unattractive investment environment in recipient countries. These effects could explain why some studies did not find a positive impact of remittances on economic growth.111

After reviewing the most obvious Latvian Diaspora effect to the economy by the form of remittances, it is time to analyse some examples of less tangible effects by Diaspora.

1.2.2. LATVIAN DIASPORA’S EFFECTS ON INVESTMENT, ENTREPRENEURSHIP AND GROWTH

“THE DIRECT INVESTMENT BY LATVIAN DIASPORA IN THE YEAR 1992 - 2005 WAS ON AVERAGE 4.8 MILLION LATS [~ 6.8 MILLION EUROS] PER YEAR. THE PEAK OF YEARLY DIRECT INVESTMENT WAS REACHED IN 2003 AND AMOUNTED TO ALMOST 7.6 MILLION LATS [~ 10.8 MILLION EUROS].”

DŽINETA DIMANTE “INVESTMENT TO LATVIAN ECONOMY BY LATVIANS ABROAD” DOCTORAL THESIS OF ECONOMICS (2007, RIGA)

Diaspora’s potential of contribution to Latvian economy has not been fully evaluated yet. The earlier chapter of Latvian remittances reveals a remarkable contribution to the Latvian economy. Latvian Diaspora’s effects on investment, entrepreneurship and growth of the home country are not easy to evaluate. This sub-chapter will mainly analyse existent examples of such cases. In addition, representatives of the Latvian

111 IMF Country Report 2015 May, No. 15/111 : Latvia available at https://www.imf.org/external/pubs/ft/scr/2015/cr15111.pdf

83 emigration and a variety of other ways, such as tourism, where Diaspora is spending money in Latvia, as well as returning and investing in Latvian economy.

A very important, but less measurable positive effect of Diaspora to local economy is the existing Direct Diaspora Investment or Diaspora driven FDI. Not much research has been devoted to that field. However, the Doctoral thesis of Džineta Dimante “Investment to Latvian Economy by Latvians Abroad” 112, focusing on post 90’s investment, by reveals that the total direct investment by Latvian exiles in equity capital from 1992 to 2005 was approximately on average 4.8 million lats per year. Direct investment in the highest value reached in 2003 and amounted to almost 7.6 million. The largest proportion of investments by Latvian Diaspora in equity capital of Latvian enterprises was investments by Venezuelan Latvian. The second largest share came from the USA, the next position of the rank order belonged to Canadian Latvians, followed by Australia, Germany, Great Britain and other.

The information obtained by the researcher shows that the Latvian organized donations from Diaspora between 1991 and 2005 amounted almost 15.7 million lats, while taking into account the estimated total amount of investments of 17 million lats. The amount of donations for scholarships, which can be considered as Latvian investments in human capital, was increasingly growing.

The total amount of investments and donations, compared to Latvian GDP during those years is quite small (0.15%), so it could not have had a significant impact on economic development as a whole. However, investments and donations made an impact on the Latvian economy mainly in creating new jobs, increasing domestic demand, promoting competition, reducing social inequalities, increasing the cultural level.

Since the research on the effects to Latvian Economy by Latvians abroad is very lacking, the author chose to demonstrate cases of how Latvian Diaspora is helping to develop economy of Latvia. Outlining the existing cases will help to determine on the necessary steps to trigger and strengthen the positive outcomes for circulating brain migration.

The next part of this sub-chapter will focus on individuals. It is important to remember that quite often it is a small fraction of the overall number of the Diaspora that are the ones who are going to make the difference. As noted by Kuznetsov, migrants are usually concerned with getting ahead individually and are not concerned with

112 Džineta Dimante “Investment to Latvian Economy by Latvians Abroad” Doctoral Thesis of Economics (2007, Riga)

84 collective Diaspora identity, and those personal ambitions drive the nature of the projects they sponsor at home, which is often limited to unpublicized sporadic and individual efforts.” In order to increase the likelihood of success in terms of Diaspora engagement, Latvia should attempt to identify and engage the following members within the Diaspora:113

 World Class Achievers  Change Agents;  First Movers;  Tipping Agents;  Career Returnees.

Every single category of influencers is special. One needs to know these categories before deciding, how to identify, cultivate, and engage that fraction. The actors that are usually engaged to knowledge and motivation transfer are the World Class Achievers type.

1.2.2.1. WORLD CLASS ACHIEVERS

There exist different catalytic roles of world-class achievers to the country of origin. Mainly they include those of inspirational motivation for entrepreneurship, country branding and similar.

A network of key influential Latvians around the world can provide their vast experience and contacts to help Latvian businesses and individuals succeed globally. They might be united in their love of Latvia and in their belief that, for Latvians who aspire to achieve internationally, there should be no such thing as a cold call.

The World Class Latvians could help Latvian businesses:

 Acting as inspiring mentors or speakers for Diaspora and local events;  Encouraging snow-ball effect of followers to join the Diaspora network;  Branding the country;  Other;

113 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

It might be a strategic tool in the development of Latvia’s global standing. By providing globally minded Latvians access to the inspiration, leadership, advice and meaningful connections they need to get to market faster and smarter, the network is in turn creating a platform to promote Latvian excellence to the world.

Whether one is a start-up, a small business, or a publicly listed company, the network can put you in touch with the right person in the World Class Latvia network that can make all the difference to your success.114

One way to reach them is by targeting inventors from Latvia known for scientific, cultural and other achievement. 115

Examples of World Class Latvians

Here are a few examples of World Class Latvians that could be engaged into Latvian brand building, act as inspiring mentors or speakers for Diaspora and local business events and encourage snow-ball effect of followers to join the Diaspora network.

Ed Viesturs (USA), World Class Achiever in Mountaineering, Acknowledged corporate speaker – motivator Ed Viesturs – the World Class Achiever in adventure sports (mountaineering) and acknowledged corporate speaker – motivator.116 Veteran world-class climber and bestselling author Ed Viesturs—the only American to have climbed all fourteen of the world’s 8,000-meter peaks, and only the sixth man to do so without supplemental oxygen—trains his sights on Mount Everest, the highest peak on earth, in richly detailed accounts of expeditions that are by turns personal, harrowing, deadly, and inspiring.117

114 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011) 115 “The World knows Latvia by... “ http://www.rsu.lv/eng/images/Documents/Publications/World_knows_Latvia_by.pd f 116 Rolex Official website: http://www.rolex.com/world-of-rolex/exploration- mountains-and-poles.html 117 Ed Viesturs official website: http://www.edviesturs.com/about-ed

Georgs Juris Mikelsons (USA), Owner of the US airline ATA

A former airline executive and airline pilot in the United States and the founder of ATA Airlines. He was born in Riga, Latvia, in 1938 on the eve of World War II. His family fled to Germany during the mid- 1940s to escape the Soviet occupation of his native land.118

He is the 1996 recipient of the Tony Jannus Award for outstanding leadership in the commercial aviation industry. Together with his wife Muriel they are active in a number of area charitable organizations, including the Indianapolis Children's Museum and the Indianapolis Symphony Orchestra.

118 From Wikipedia: https://en.wikipedia.org/wiki/J._George_Mikelsons

Juris Upatnieks (USA), Innovator

Juris Upatnieks, (born 7 May 1936 in Riga) is a Latvian- American physicist and inventor, and pioneer in the field of holography.119

Main inventions of Upatnieks include prevention of double image problem; recording of three- dimensional images; holographic interferometry; holographic sight. 120 It is shown that the method of holography has enabled the development of variety of different branches in science, engineering and art.

For the invention of off-axis holography Emmeth Leith and Juris Upatnieks were recommended for the Nobel Prize in physics. Until now Juris Upatnieks has been the only Latvian scientist who has had a realistic chance to receive it.121

1.2.2.2. CHANGE AGENTS

As described by K. Aikins, “Change agents are members of the Diaspora who bring new ideas and new ways of investing into their countries of origin and thereby contribute to its development. One of the main types of change agents include Diaspora philanthropists whose philanthropic endeavours result in societal change for the homeland. There are countless case studies of Diaspora philanthropists as change agents.”122

119 From Wikipedia: https://en.wikipedia.org/wiki/Juris_Upatnieks

120About Juris Upatnieks: http://izgudrojumi.lza.lv/izg_en.php?id=45

121 The Trailblazer of Holography – Juris Upatnieks (2009): http://www.lu.lv/adz/arhivs/45-numurs/holografijas-celmlauzis-juris-upatnieks/

122 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

Examples of Change agents

Vaira Vīķe-Freiberga (Latvia, lived in Canada), the sixth President of Latvia and the first female President of Latvia

Vaira Vīķe-Freiberga was elected President of Latvia in 1999 and re-elected in 2003. Today she is involved in global political affairs through various organisations. 123 When Latvia acceded to both the EU and NATO in 2004 many attributed that success in part to dr. Vīķe-Freiberga's leadership.

In 1944 the Vīķe family fled the Soviet occupation of Latvia. Via refugee camps in war- battered Germany and a stay in French Morocco her family arrived in Canada, where Dr. Vīķe-Freiberga finished her education. She became a professor of psychology and linguistics at the University of Montreal, a position she held for 33 years. In all this time Dr. Vīķe-Freiberga maintained ties with her native country. 124

Andris Berzins (Australia born Latvian), Co- founder TechHub Riga, entrepreneur, contributor to the Latvian start-up ecosystem

Andris is an experienced global technology entrepreneur, angel investor and start-up mentor, actively supporting the growing Baltic start-up community. Previously he served in various C-level positions, most recently at Livebookings, Europe's leading provider of online restaurant reservations. Prior to that, he led marketing, business development and EMEA sales for AeroScout, a global provider of Wi-Fi location solutions that was sold to Stanley Black & Decker. Andris is also Investment Advisor for the Stockholm-based venture capital fund Creandum. Andris holds an MBA

123 Vaira Vīķe-Freiberga , Wikipedia: https://en.wikipedia.org/wiki/Vaira_V%C4%AB%C4%B7e-Freiberga

124 The Europe Lecture available Biography of at Vaira Vīķe-Freiberga available at https://www.europelecture.com/id/via8nhy2x0pn/v_vaira_vike_freiberga

89 from the Stanford Graduate School of Business and a Bsc in Management & Systems from City University.125

Karlis A. Cerbulis (Latvia, lived in the US), Co- founder and former first president of the Riga Stock Exchange, Senior Vice President, NCH Baltic States 126

Karlis A. Cerbulis, Senior Vice President, Baltic States, is based in Riga and has been with NCH since 1996. Mr. Cerbulis manages the activities of NCH in the Baltics and participates in the management of NCH’s agribusiness investments in the Region. Prior to joining NCH, Mr. Cerbulis was the co-founder and first president of the Riga Stock Exchange, which began trading operations in July 1995. From 1987 to 1993, Mr. Cerbulis was in management positions at Bank One in Columbus, Ohio, including participating in the Executive Development Program and attaining the rank of Assistant Vice President. He has also served as an advisor to the Minister of Economy in Latvia. Mr. Cerbulis received a B.S. in Agronomy, with highest distinction, from Pennsylvania State University and an MBA from Harvard Business School. 127

Dr. Egils Gulbis (Latvia, lived in Belgium), Founder of SIA "E. Gulbja Laboratorija" 128

E.Gulbja laboratory set up in 1993 was the first clinical analysis laboratory in the Baltic countries, which introduced a series of innovations in its industry: it was the first integrated (all divisions) wide range of clinical analysis laboratory. It was founded by a Latvian dr. Egils Gulbis, coming from Belgium. Dr. Gulbis founded clinic by using his knowledge, long-term experience in

125 Techhub Riga, Co-founder https://www.techhub.com/staff/andris-berzins/ 126 Photo taken from: http://www.rmsforum.lv/en/event/24 127 http://www.nchcapital.com/index.php?option=com_content&task=view&id=13&Ite mid=81 128 SIA "E. Gulbja Laboratorija" website: http://www.egl.lv/par- mums/person%C4%81ls

90 managing similar laboratories in Brussels and a strong motivation to improve people's standard of living at home. 129

1.2.2.3. FIRST MOVERS

First movers can be described as ‘investors who could come first to an emerging or growing market of the home country, and by doing this could change market expectations and advance an inflow of more conventional FDI.’ Similarly, they have been defined as ‘economic agents who are ready to take additional risks and, when successful, are seen by their peers as role models for replication and follow-up. And by being the first movers, Diaspora representatives have a chance of becoming leaders, mentors, partners and godfathers of the local private sector.’ Engagement with ‘first movers’ should form an important part of the Latvian Diaspora strategy.130

Examples of Latvian First Movers

Below you can find some examples of how Latvian Diaspora First Movers have influenced the market expectations and advance an inflow of more conventional FDI.

Elmārs Tannis (Latvia, born in Canada), Pica Lulu owner, catering entrepreneur Elmārs Tannis together and his friend Pēteris Ruģelis were born and grew up in Canada. They arrived to Latvia in the 90’s to start restaurant business there. Elmārs Tannis became popular chef, owner of several restaurants, an

129 Dimante, Džineta doctoral thesis „Contribution of Latvian Exiles in Economy of Latvia” (Riga, 2007) available at https://dspace.lu.lv/dspace/handle/7/5153?locale- attribute=en

130 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

91 attractive television personality. He calls Canada his homeland and Latvia his motherland.131 Brigita Stroda (Latvia, born in Australia), Lakstigala.com Co-founder, owner Brigita was born in Melbourne, Australia. She says that “she has always lived a double life between Latvia and the rest of the world”. 132 After working with nation branding and PR at The Latvian National Culture Centre, National Integration Centre of Latvian Ministry of and Latvian Tourism Development Agency133, Brigita’s co- founded online shop Lakstīgala - a platform to make limited edition products, suitable for gifts, available to a worldwide market of potential customers. Its creators are Latvians who were born in Australia and America with an “almost Latvian” web-designer. 134

Ivars Slokenbergs (Latvia, born in USA), Senior Associate at Klavins Ellex 135 Ivars Slokenbergs presently practices law in Riga, Latvia, however, he is admitted to the State Bar of New York, and formerly was a litigator at the New York office of the global law firm of White & Case. He began his career as a diplomat – serving as Political and Legal Counsellor at Latvia’s Permanent Mission to the United Nations in New York. Ivars Slokenbergs is a corporate lawyer at Klavins Ellex (formerly LAWIN) – the internationally highest ranked business law firm in the

131 http://www.kasjauns.lv/lv/zinas/86063/elmars-tannis-no-picam-lidz-umami

132 LinkedIn Profile: https://www.linkedin.com/in/brigita-stroda-37b2ab17

133 “Bez ku-kū saukļiem”, Diena.lt, 2008 http://www.diena.lv/bez-ku-ku-saukliem- 619757

134 Lakstīgala offical website: http://www.lakstigala.com/about-lakstigala/

135 LinkedIn Profile: https://www.linkedin.com/in/ivars-slokenbergs-b1873b35

Baltic States. He also serves on the boards of the Foreign Investors' Council in Latvia and the Latvian Transatlantic Organisation. In March 2014, he completed a 6 year term on the board of the American Chamber of Commerce in Latvia, including 4 years as President. 136

Edvīns Kalviņš (Latvia, born in Canada), President & CEO at Technical Partners Edvīns Kalviņš is a businessman in the field of renewables & environment. Currently he is Chairing the Canadian Chamber of Commerce in Latvia. Previously he has been active in Canada-Latvia Business Association, Sandoz Canada Inc. Mr. Kalnins has graduated from the University of Toronto137

Ruta Whittaker (Latvia, lived in Canada), SIA Ekosaule co-founder

After returning to Latvia from Canada in 1997 Mrs. Ruta Whittaker and her Canadian husband co-founded SIA Ekosaule. It is an environmental consulting company based in Latvia, affiliated with its Canadian partner Ekosaule Consulting Inc. The company has participated in projects in Canada, U.S.A., Latvia, Romania, Czech Republic, Ukraine, Finland, Estonia and Lithuania. Ruta Whittaker has been also active in philanthropy projects such as supporting the Riga International Competition for Young Pianists.138

136 LinkedIn Profile: https://www.linkedin.com/in/ivars-slokenbergs-b1873b35

137 LinkedIn Profile: https://www.linkedin.com/in/ed-kalvins-6b4874a

138 Birtish Chambers of Commerce, Member Profile http://britcham.lv/member/ekosaule-sia-0

Mārtiņš Rītiņš (Latvia, born in the UK) Executive Chef at Vincents Restaurant, Martins Catering founder

For more that fifteen years Mr. Martins Ritins has been a star in the Latvian culinary sky. Chef is a British-born Latvian grew up in the industrial town of Corby, before moving to London to become a chef. He then spent many years in Toronto, Canada, where he acquired a fondness for organic food. Martins hosts his own cooking television show on Latvian State Television. He is also the president of Latvia's Slow Food Association.139

Aleksis J. Karlsons (Latvia, lived in the USA), CEO at Omnium Properties, Hotel Bergs 140

Berga Bazaar was the first American Latvian recovered property in the 90’s. 141 The Omnium Properties Group has brought world-class standards to Latvia’s residential and commercial real estate sector as well as to the hospitality industry. Since 1991, Omnium Properties specialises in renovating and managing historical buildings throughout Latvia.

1.2.2.4. TIPPING AGENTS

139 Vincents restaurant chef profile: http://www.restorans.lv/en/about_us/chef/

140 LinkedIn Profile: https://www.linkedin.com/in/aleksiskarlsons

141 “Aleksis J. Karlsons: Latvia is a very attractive place as a base for many industries - not only geographically, but also in legal terms.” World Latvian Economic and Innovations Forum (2015): http://www.ieguldilatvija.lv/lv/aleksis-j-karlsons-latvija-ir- loti-pievilciga-vieta-ka-baze-daudzam-nozarem-ne-tikai-geografiski-bet-ari-juridiska- zina/

It is important to identify, research, cultivate and ask Diaspora members who are going to be in positions of influence years before they actually get into that position to become strategically engaged. According to K.Aikins, these people are called ‘tipping agents’ – people who can ‘nudge’ a deal in a certain direction, act as brand ambassadors for their home country, who can be the ‘eyes and ears’ on the ground and can watch out for future opportunities for their home country. It can be especially important for inward investment decisions particularly, where deals may be 50/50 and small factors could sway a decision in one direction or another. The key to having effective ‘tipping agents’ is to keep in constant contact, to inform them of developments in the home country and make them feel part of the national team. However, essentially business related there often can be many other spinoffs.142

Below you can find some examples of how cooperation with Latvian professionals abroad can help if they are approached as “Tipping agents”.

Examples of Latvian Tipping Agents

To demonstrate that there already exists such cooperation with formal and informal “Tipping Agents” of Latvian descent, the author relies on examples at LIAA and private businesses in Latvia, already practicing that cooperation.

Latvian Investment and Development Agency has a track of cooperating with Neils Strazdins living in Australia, who works at Australia’s export promoting agency. He has been helping with planning company visits in the occasion of Latvia’s Ambassador A. Teikmanis visits to Singapore, Australia and New Zealand.143

142 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

143 Quantitive Interview with LIAA representative Liga Plaveniece by Dalia Petkevičienė (October 2015)

Niels Strazdiņš (Australia), Head Research Manager at Export Council of Australia | Associate at Dearin & Associates Niels Strazdins lives in Sydney Area, Australia. He specialises in International Trade and Development. Strazdins has been currently working at Export Council of Australia, Dearin & Associates and The Eurasian Initiative. Previously he has been working with CAPA - Centre for Aviation and 180 Degrees Consulting. He has graduated from the Macquarie University 144

Riga based pan-Baltic export and market Intelligence Company “Gateway Baltic” revealed that it cooperates with the following two Latvians abroad and their companies established in the US:145

144 LinkedIn Profile: https://www.linkedin.com/in/nstrazdins

145 Qualitative interview with Inese Andersone, CEO “Gateway Baltic” by Dalia Petkevičienė (October 2015, Riga)

Juris Blodnieks (USA), Manager at Latvian American Shipping Line, USA 146 Latvian American Shipping Line (LASL) provides specialized ocean and air shipping services between the United States and the Baltic countries of Latvia, Estonia and Lithuania, Belarus, Western Russia and by rail to most of Russia and Central Asia. LASL is a niche operator - the company concentrates its activities in this area. Latvian American Shipping Line was one of the first transport companies to begin its activities in the newly independent Latvia, and between Latvia and the United States.147

Klāvs Zihmanis (Canada), Latvian Canadian Business Association (Latcan) member Klavs Zihmanis is a Board member of the Canadian Latvian central organizations History teacher, a Latvian member of the Board of the Fund.148

1.2.2.5. CAREER RETURNEES AND REMOTE MENTORS A huge Latvian potential lies in the New Generation Diaspora that might be willing to come back to pursue their career goals. Some of them are willing to share their experience and expertise with Latvian youth and among themselves. There are examples of Latvians who have returned and have been building their career to the

146 LinkedIn Profile: https://www.linkedin.com/in/juris-blodnieks-464b943

147 Latvian American Shipping Line (LASL) website: http://www.lasl.com/index.php?p=9090&lang=1548

148 Profile available at http://www.irlv.lv/profils/38156/skatit

97 homeland. Examples of professionals abroad willing to virtually engage suggests there is a potential to further engage and motivate them.

Examples of Latvian Career Returnees

Pauls Miklašēvics (Latvia, born in Canada), Head of Client Portfolio Management at Baltikums Bank AS

Pauls Miklasevics has been currently working at Baltikums Bank AS. His previous experience involves work with Citadele Asset Management, Mavrix Fund Management. He is a graduate at Queen's University in Canada. 149

Rihards Kalniņš (Latvia, born in USA), International Development Manager at Tilde.150

Rihards Kalnins is a Business Development Manager at Machine Translation and Terminology Group at Tilde. Previously he has worked at Investment and Development Agency of Latvia and Latvian Institute.

Rihards Kalnins is a graduate at DePaul University.

149 LinkedIn Profile: https://www.linkedin.com/in/paul-miklasevics-6706253

150 LinkedIn Profile: https://www.linkedin.com/in/rihards-kalnins-5460b55b

Agate S. Freimane (UK, London born in Latvia), Senior Investment Director, BrickVest.151

She has been working in one of the world's most influential financial institutions, Morgan Stanley's London headquarters for more than five years. She is a real estate investment specialist.152 While living in the UK, Agate S. Freimane shares career advice to the youth in the media.

1.3. RESEARCH AND SITUATION ANALYSIS OF LATVIAN DIASPORA POLICIES This Chapter will focus on the main existing governmental policies as well as activities by organizations that involve Diaspora engagement for Latvian economic development. After providing with an overview on the legal background of policies, the author will outline the main activities that implement the policy. A large amount of attention will go to LIAA’s activities and policies what regards to engaging Latvian Diaspora.

1.3.1. GOVERNMENTAL POLICIES FOR ENGAGING DIASPORA FOR ECONOMIC DEVELOPMENT OF LATVIA In the recent years the government of Latvia has attempted to redefine a sensitive field - the Diaspora policy.153 This chapter will review of attitudes and policies in this field.

In Latvian public discourse, emigration has primarily seen as a loss of labour partially due to a rapidly aging society. Several policy documents have been developed by government, focusing both on:

151 LinkedIn Profile: https://www.linkedin.com/in/agate-s-freimane-2375a811

152 “Ka gut panakumus Londona”, Monday 2015 available at: http://www.monday.lv/ka-gut-panakumus-londona/

153 Latvian Institute “The Latvian Diaspora” available at http://www.latvia.eu/fr/blog/latvian-diaspora

 Strengthening ties and developing cooperation with the Diaspora (including those who will not return);  Fostering return migration (targeting potential return migrants).  Helping to smoothly integrate back into the society (actual return migrants).154

So far, the policy of Latvian Ministry of Economy has been mainly focusing on the potentially returning migrants. There is no or very little action planned in order to engage Diaspora regardless of their decision to return physically.

Action Plan on Return Migration

Ministry of Economy led the development of the Return Migration Action Plan 2013 - 2016. It was accepted in 2013. The Plan aims to provide practical and accessible help/support for return migrants. It includes 8 points that were agreed upon at a national level. Ministry of Economy of Latvia initiated the process and formed a working group. It offered the possible steps for the possible contribution to increasing return. Later on, eight steps were voted by the nationals on one internet based platform.

One of the most important legislations that came out as a part of this Plan was the Dual Citizenship Act that allowed Latvian citizens to keep their citizenship even after taking the one from another country. Other steps are including establishment and maintenance of the relations with the Diaspora and facilitation of returning. The target groups are highly skilled and people who gained their education abroad. Thus, working group also came up with conclusion that qualifications, which were gained abroad, should be recognized in the Latvian system (Latvian Ministry of Economy 2013). All the respondents in the study expressed a very positive attitude towards the new strategy, though they also acknowledged that it could be seen as only the first steps of the dealing with the problem. They were also agreeing that the return will not be enough to fill in the labour shortages of the recovered economy. According to the calculations, only 25 % of the return rate could be expected.

Thus, some of the respondents, especially academics and Employers’ Organizations, were bringing up the future need of the immigration. Finally, another option was proposed by the Plan and also promoted by Employers’ Organizations is the

154 Inta Mierina Return Migration to Latvia: Problems, Policies, Perceptions and Perspectives (2015 Riga) available at https://eu2015.lv/images/Kalendars/MFA/Inta_Mierina_Presentation_Riga.pdf

100 reformation of the education system with the emphasis on the encouragement to choose vocational education instead of the higher one.155

Although the government has been mostly focusing on the (potentially) returning Diaspora in order to attract them back, this paper is targeted on the ways to engage and mobilize Latvian Diaspora. Here the return is seen as preferable, but not always feasible in order to contribute to the home economy in the best possible way. Therefore, this paper will primarily analyse policies on Diaspora Engagement.

The Ministry of Foreign Affairs of Latvia (MFA) is the core ministry to form the policy of Diaspora Engagement. The ministry communicates that “in view of the massive emigration flow over the past two decades, cooperation with the Latvian Diaspora has become one of the priorities of the Foreign Ministry work aimed at promoting political and civic participation of the Diaspora, preserving Latvian identity and bonds with Latvia, and strengthening cooperation with compatriots abroad. MFA’s network of diplomatic missions and consular posts is instrumental for strengthening the links connecting Latvia with our compatriots living abroad, the Diaspora organisations and the media – which includes building and sustaining a dialogue.”156

Action Plan on Cooperation with the Latvian Diaspora

In 2013, the Ministry of Foreign Affairs, in its report On Cooperation of the Ministry of Foreign Affairs with the Latvian Diaspora in 2013 – 2015, set out four lines of action:

 facilitating the civic and political engagement of the Diaspora;  preserving the Diaspora’s bonds with Latvia and Latvian identity;  promoting cooperation with the Diaspora in business, science, education, and culture;  supporting those who wish to return to Latvia. 157

In 2014 the Latvian Ministry of Foreign Affairs announced an Action plan on cooperation with the Latvian Diaspora for 2015-2017. For the first time in Latvia’s

155 “Policy response to emigration from the Baltics: confronting ‘the Elephant in the Room’’ by Indre Genelyte, REMESO, Linkoping University available at: http://nwlc2014.com/wp-content/uploads/2014/05/Genelyte1.pdf

156 Diaspora Policy in Latvia MFA, 2015: http://www.mfa.gov.lv/en/policy/2014-12- 22-11-41-00/diaspora-policy-in-latvia

157 Diaspora Policy in Latvia MFA, 2015: http://www.mfa.gov.lv/en/policy/2014-12- 22-11-41-00/diaspora-policy-in-latvia

101 history, this policy-planning document drafted under the guidance of the Ministry of Foreign Affairs defined a trans-sectoral policy for cooperation with Latvian Diaspora.

The Action Plan was produced by the Diaspora Policy Working Group led by the Foreign Ministry in conjunction with the Ministry of Culture. The document was drawn up during consultations with the responsible line ministries as well as other public institutions and Diaspora organisations.

The Diaspora policy document comprises more than 50 different activities categorized in accordance with four lines of action mentioned earlier. The underlying principles of the document are a mutual exchange of information and active provision of information to the Diaspora about the issues important for it, thus regarding members of Latvia’s Diaspora, irrespective of their country of residence, to be part of the Latvian nation and engaging all that feel an affinity with Latvia.

The broad scope of measures set out in the document includes activities in various fields important for the Diaspora: supporting the work of Diaspora organisations and weekend schools; promoting Latvian culture; strengthening the connections of children and young people with Latvia, including by way of summer camps; integrating children into the education system; and other activities. The action plan outlines new initiatives for engaging the Diaspora in the processes underway in Latvia, and for facilitating the work of Latvian enterprises and providing networking events for professionals and businesspersons stemming from Latvia. An important role has been assigned to measures towards increasing the availability of information for the Diaspora on the internet, television, radio and other media and communication platforms.

Thought the Action plan focuses on culture and education mainly, there exists action direction devoted to cooperation with the Diaspora in the economy, education and science, brain circulation promotion. The main Objective here is to strengthen the Diaspora’s involvement in Latvian social processes in order to achieve Latvian living in the Diaspora and the interaction between brain circulation and promotion of its strengthening transnational Latvian community, which contributes to the Latvian public development.

The MFA’s action plan suggests these necessary actions for engaging Diaspora into Latvian economic, academic and other professional life:

 Expand and strengthen the link between Latvian professionals living abroad and Latvian counterparts to focus on knowledge capital that could be invested in Latvia, by contributing to the areas of growth.

102

 Encourage public institutions to identify the Diaspora potential in certain sectors while collaborating with the Diaspora, media and Latvian universities and researchers.  Continue to build and maintain the business networking opportunities and mutually developing activities to promote economic cooperation to ensure the continuation of World Latvian Economic and Innovations Forum.  Promote activities aimed at youth audience, and continue to other results- oriented forum continuation.  Encourage embassies to gather information of Diaspora representatives in economic, cultural, scientific, etc. areas living in the host countries through the Diaspora organizations at the disposal of data that already exist, as well as obtaining information from the Diaspora representatives.  A Diaspora focus must be expanded and activated within in the work of Latvian diplomats in economic matters, LIAA foreign representatives, business chambers and industry associations. That involves engaging the Latvian Honorary Consuls in the host country, while organizing economic events abroad and in Latvia.  Evaluate the idea to create a network of high-level Foreign Latvians living abroad. It could attract targeted entrepreneurs with high government officials patronage involved (the President and / or Prime Minister).  Support actions aimed at any professionals to network together, including in science and art.

1.3.2. IMPLEMENTING LATVIAN DIASPORA POLICY This sub-chapter will focus on existing activities of social partners and non- governmental organisations, especially Latvian organisations and communities. Their activities reflect how the policy on Diaspora engagement is being implemented in practice. Since the restoration of Latvian independence, there were several attempts to organize bridge promoting professional activities. For example, Latvian scientists took action to organize medical conferences, Diaspora actively developed cooperation in the field of art and culture in Latvia. In recent years, cooperation with the Diaspora has become much more intense, more meaningful and diverse. These are the initiatives mentioned as the most successful by Ministry of Foreign Affairs:  Since July 2011, an annual Diaspora Conference "Latvians in the world belong to Latvia" has been organized by European Latvian Association. It performs the function of dialogue between the Latvian the government and the Diaspora.  In 2013 and 2015 World Latvian economy and Innovation Forum was organized, which brought together Latvian origin entrepreneurs, researchers,

103

finance experts and other professionals from around the world. Its aim was to stimulate Latvian origin entrepreneurs and professionals to work with Latvia, promoting participation and investment in Latvian economy.

1.3.2.1. DIASPORA NETWORKS IN ACTION There are formal (associated) and informal (non - associated) Diaspora networks that demonstrate a focus on engaging its members to Latvian economy. Both groups are important. The author will further analyse the most vivid networks, campaigns and initiatives related to the subject.

The World Federation of Free Latvians (PBLA)

The World Federation of Free Latvians (PBLA) is the central umbrella organisation for overseas federations of Latvian organisations, representing these organisations at the highest level. The constituent members of the PBLA are:

 American Latvian Association;  South American and Caribbean Latvian Association;  European Latvian Association;  Russian Latvian Congress;  Latvian Federation of Australia and New Zealand;  Latvian National Federation in Canada.

The main mission of the PBLA is to unite Latvians in continuing to strengthen Latvia’s independence and promote Latvia’s development in democratic, cultural and economic spheres; to promote active, organised, influential and vital Latvian communities overseas; and to promote the unity of Latvians worldwide.

The activities of the PBLA are financed by voluntary contributions from overseas Latvians to the Latvian Freedom Fund, and World Federation of Free Latvians subsidiary organisation funds.

An Educational Council, working under the auspices of the PBLA, was established in 1976 with the aim of promoting and coordinating Latvian education outside of Latvia. This is as part of the PBLA Cultural Fund, formed in 1972, with the aim of supporting the preservation and development of Latvian culture, including Latvian educational

104 activities, in overseas Latvian communities. The PBLA central office is in the U.S.A., but since 1991, representation operates in Riga.158

World Latvian Economy and Innovation Forum

PBLA organized the first World Latvian Economy and Innovation Forum in July 2013 which took place in Riga during the Latvian Song and dance festival. The second World Latvian Economics and Innovations Forum took place in 2015 in Riga brought together around 300 participants from 17 countries. It was seen online by people from nearly 40 countries, starting from Latvia's neighbouring countries to more distant regions, such as the United States of America, Canada, Australia, and China. The focus of the forum was oriented on new opportunities for Latvia's export diversification, attracting foreign investments, and strengthening entrepreneurial culture in Latvia.

The main goal of the WLEIF was to promote Latvian expatriates' involvement in strengthening Latvia's economic development through improved communication, transfer of knowledge, cooperation initiatives and investment opportunities.

A separate Pre-Forum Meeting for international participants was held on July 9, 2015 featuring discussions between Latvian government officials and international participants on topics at the forefront of Latvia's economic agenda.

Junior WLEIF

Prior to the forum a separate session for young professionals was organized. The Junior-WLEIF aimed to introduce young adults and young professionals of Latvian origin living abroad and recent repatriates to entrepreneurship, employment and education opportunities in Latvia, promote their interest in temporary or permanent relocation to Latvia. The target audience included young adults and professionals with connections to Latvia, as well as young repatriates, who are interested in education, career, and entrepreneurship opportunities in Latvia. The issues that were addressed during Junior-WLEIF included:

 Work and education possibilities in Latvia;  Tips to succeed in Latvia;

158 Taken from Latvian Federation of Australia and New Zealand website: http://laaj.org.au/en/world-free-latvia-association/

105

 Start a business in Latvia. 159

World Latvian Mentoring Program

Within the framework of the 2nd World Latvian Economics and Innovations Forum (WLEIF), the World Federation of Free Latvians invited experienced business leaders, entrepreneurs, and professionals with connections to Latvia to join the „World Latvian Mentoring Program“.

This program is a pilot-project that was launched on the sidelines of the Forum and aims to promote transfer of knowledge between highly-successful professionals in the world and young professionals in Latvia.

Becoming a mentor gives business people connected to Latvia a chance not only to assist young Latvian professionals and entrepreneurs in their career development, but also to contribute to the overall development of Latvia. Mentoring Program is presented as a volunteering opportunity, requiring minimal time investment with potentially great impact. There was no requirement to attend WLEIF 2015 in person to become a mentor.

Interested mentees that are seeking a mentor to help in their professional development are required to introduce themselves to the list of highly-successful mentors. Mentors demonstrate different professional backgrounds. They have agreed to share their knowledge and experience with young professionals from Latvia.

In order to state one’s interest in joining the program as a mentee is asked to indicate, which of the mentors would you like to be put in contact. The mentees are encouraged to be as specific as they can in stating their needs. At least 11 Mentors with international experience have joined the pilot program from the USA, Latvia, Venezuela, Croatia and Luxemburg.160

European Latvian Association (ELA)

European Latvian Association (ELA) aims is to represent the interests of the Latvian Diaspora at European level, its member organizations in the information, education and culture and the promotion of cooperative projects between the member

159 Expat professionals ready to foster Latvia’s economy http://www.amcham.lv/en/activities/events/save-the-date/latvian-economic-and- innovation-forum

160 World Latvian Mentoring Program overview: http://www.ieguldilatvija.lv/world- latvian-mentoring-program/

106 organizations, as well as affiliated organizations of emigrants of other nationalities. ELA is a member of The World Federation of Free Latvians (PBLA).

ELA activity is focused Latvian citizens and ethnic Latvians living in Europe, representing the interests of the Latvian government (e.g., civic participation, promotion of Latvian education for non-Latvian, easing of repatriation), supporting the Latvian Diaspora organizations in strengthening and promoting cooperation by offering information and material support as well as the Latvian culture and history of the promotion in Europe.

Conference “Latvians in the World - Belong to Latvia”

ELA organizes annual international conference "Latvians in the world - belong to Latvia" together with the Latvian Ministry of Culture, Ministry of Foreign Affairs and Ministry of Education and Science in collaboration with The World Federation of Free Latvians (PBLA).

The conference agenda states two central objectives: to develop a dialogue on the necessary actions to maintain the Latvian identity, sustainable links and cooperation among Latvians abroad and Latvia native land and its educational institutions; as well as to offer proposals for the development of the policy planning document in cooperation with Latvians abroad.

1.3.2.2. PROFESSIONAL CLUBS OF LATVIAN DIASPORA

Cambridge University Latvian Association

The Cambridge University Latvian Association draws together the Latvian students at the university, as well as anyone interested in the Latvian language and culture. The society organises events that provide the opportunity to speak some Latvian, discuss issues related to the country, and help new Latvian students to settle in the university.161

The annual Cambridge Baltic Conference (CBC), co-organised by the university’s Estonian, Latvian and Lithuanian societies, allows inspiring and high profile speakers from the Baltic States and the UK to share their expertise on a variety of topics.

161 Cambridge University Latvian Association available at https://www.cusu.cam.ac.uk/societies/directory/latvianassoc/

107

The topic of the year 2015 was Entrepreneurship and the Economy. The event brought together the knowledge, creativity and experience of students, academics, politicians, as well as the business community, to examine important issues about the entrepreneurial environment of the Baltic countries.162

Business Club of Latvian Entrepreneurs in California "KLUBS"

Business Club of Latvian Entrepreneurs in California "KLUBS" was established on January 26, 2013 at the meeting of 10 Latvian entrepreneurs in California, at Latvian Honorary Consul in Southern Juris Bunkis home, during the Latvian Ambassador to the U.S. Andris Razans visit to California.

The goal of the Club is to bring together Latvian businesses in California for cooperation and collaboration with Latvia. The club seeks to inform the Latvian Investment and Development Agency and the Latvian Chamber of Commerce and Industry about our efforts to think about Latvia and help to develop business contacts, thus promoting mutual trade and investment attraction. The CLUB page aims to help Latvian entrepreneur to more easily find and reach them.163

Global Society for Latvian Art

The Global Society for Latvian Art is a non-profit organization in the US which was incorporated in 2004. Its mission is: to promote, preserve, and exhibit works of art created by artists who were exiled from Latvia as a result of the Second World War as well as other artists of Latvian descent; to promote and encourage global communication among persons interested in Latvian art and culture; to establish and operate a centre for Latvian Diaspora art dedicated to collecting, studying, exhibiting and preserving such art; and to work with all existing Latvian-American organizations.164

162 Cambridge Baltic Conference available at: http://cambridgebalticconference.eu/2015/

163 Business Club of Latvian Entrepreneurs in California "KLUBS" available at: http://latvianbusiness.us/en/home-457421

164 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

108

All the three above-mentioned professional or regional clubs are examples of formal and non-formal communities or networks. They are a great source and cooperating partners while identifying and later engaging the targeted Diaspora.

1.4. ANALYSIS OF DIASPORA ENGAGEMENT WITHIN LIAA

This chapter focuses on Diaspora engagement analysis within the Latvian Investment and Development Agency. The Diaspora engagement cases will be analysed with respect to existing priorities for Latvian exports and FDI attraction.

1.4.1. OVERVIEW OF EXPORT PRIORITIES

According to the “Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019” , the export support measures are carried out in three main directions of informative and advisory support; assistance in finding of cooperation partners and promotion of cooperation; external economic representation and export marketing.165

The Guidelines set the priority of export support services of those sectors, which bring in the greatest contribution to GDP of the Latvian economy, and which occupy the largest share in the total exports of Latvian goods and services in particular:

 metal working and machinery;  wood production;  food industry;  chemical industry and its related industries;  light industry;  printing and publishing industry;  construction, production of building materials;  production of electric and optical equipment;  information and communication technologies;  tourism;  “niche product support” approach in favour of those products with higher added value.

165 Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019

109

According to the “Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019”, geographical target involve countries to which export support activities are focused and defined according to the following criteria:

 significant export markets for Latvia;  market size and growth potential, geographically close;  active interest of Latvian entrepreneurs in the particular market/interest of foreign entrepreneurs in Latvia;  adequacy of the market demand to possibilities of Latvian supply (market niches).

The Guidelines states that regarding the export target markets, it is important to retain and develop the exports to those countries, which historically have been the main export partners of Latvia:

 EU countries;  CIS countries;  Fast growing markets (for example, BRIC);  Market niches countries.

1.4.2. OVERVIEW OF FDI PROMOTION PRIORITIES

To fulfil the objective of the guidelines based on comparative advantages of Latvia and statistics of Latvia in attracting FDI and provide for stable development of the Latvian economy, eight target sectors have been identified with the highest perspectives in attracting foreign direct investments166:

 metal works and mechanical engineering;  transport and logistics;  information technologies and service offices;  life sciences (pharmacy, biotechnologies in human health, veterinary and agro biotechnology fields);  health care;  manufacture of wood;

166 Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019

110

 greentech (renewable energy, wastewater management, as well as management of solid waste and recyclable materials, manufacturing of technologies and plants in these fields);  food production.

Definition of FDI attraction target countries (see Table 2.) allows for determined planning and orientation of LIAA and other FDI attraction involved institutions' operation, thus employing the available financial and human resources as effectively as possible to reach the FDI attraction goal – attracting FDI to external demand oriented sectors. At the same time, definition of target countries does not limit the FDI attraction activities of entrepreneurs and their representing organizations in other countries.

FDI Attraction: Target countries and sectors (in an alphabetical order)

High priority countries Priority countries Secondary countries Metal working and machinery France, Germany, Japan, the China, Denmark, Finland, Russia India, Italy, Republic of Korea Netherlands, Norway, Sweden, and other countries United Kingdom Transport and logistics China, France, Kazakhstan, Belarus, Denmark, Finland, Japan and other countries Russia United Kingdom, USA Germany, the Netherlands, Norway, Singapore, Sweden

Information Technologies (including global business services) Finland, Germany, India, Japan, China, Denmark, Israel, the France, Singapore and other Sweden, United Kingdom, USA Netherlands, Norway, Republic countries of Korea, Russia

Life sciences France, Germany, Japan, Denmark, Finland, Israel, the India, Russia and other Sweden, United Kingdom, USA Netherlands, Norway, countries Health care Denmark, Finland, Germany, France, the Netherlands, USA Other countries Israel, Norway, Russia. Sweden, United Kingdom Wood production Denmark, Finland, France, Japan, the Netherlands, Russia, China and other countries Germany, Norway, Sweden, USA United Kingdom

111

Table 2. LIAA Priorities for FDA attraction.167

According to the Guidance paper, regarding the far-east countries – in China, Japan and India, Latvia has to be positioned as a point for further access to both the EU and CIS markets.

Having overviewed the existent LIAA priorities of FDI attraction and exports promotion, it is also important to research the level of current Diaspora engagement intensity within LIAA.

1.4.3. HOW LIAA WORKS WITH LATVIAN DIASPORA

LIAA co-implements the government’s Action Plan for Diaspora Engagement coordinated by Latvian Ministry of Foreign Affairs. For example, the action plan directs LIAA to organize two events per year for Diaspora entrepreneur and employers living abroad as well as Diaspora representatives that are likely to invest to Latvia. However, this sub-chapter will focus on the actual level of engaging Diaspora.

LIAA Representatives and Diaspora

The author has conducted a survey of LIAA representatives on Diaspora relations. The aim was to understand, what is the current level of working with Diaspora at LIAA. This survey will allow to understand and make conclusion of the current situation and a possible potential for Diaspora Strategy within LIAA. The questions involved:

1. What are the main Diaspora facts and figures in your destination country?

2. What is the current experience of engaging Latvian expats/Diaspora members into LIAA activities/ Latvian economy life, if any? Any success stories to tell?

3. What is the potential professional segmentation and fields of involvement in different countries, if any? (E.g. expat banking professionals in London City financial centre; creative professionals etc.)

4. Could you share your database of Latvian (origin) achievers/professionals/young leaders?

167 Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019

112

10 LIAA representatives abroad replied to the survey. Here is the sum up of their responses (see Table 3.).

Country Diaspora size Experience of Potential Diaspora Database engaging Latvian segmentation / expats/Diaspora involvement fields

Denmark 5000 N/A 10% students out of N/A all Diaspora

Finland 15000 Active Freelancers, IT, N/A cooperation: banking Latvian days in professionals, Finland, European Institution successful employees - the facilitating job most active part of opportunities of the community. Latvians via Blue -collar contacts with employees, med locals, planning care professionals on more (e.g. dentists) are cooperation for spread around the Latvian events, country, not trade promotion. participating.

UAE 430 Some interested Mostly aged 25-45, N/A , in representing IT, consultancy, Facebook Latvian brands in sales and marketing group the Middle East, professionals. but no success stories so far.

UK ~ 80 000 LIAA helps UK's LIAA engages mostly UK's Latvian Latvian Business with the creative Business 3 NGOs Network to professionals, i.e. Network, organize social Latvians who have Latvian events. Focus: started their own Professionals inspirational business in the UK in London Latvian Diaspora and at times are entrepreneurs. ready to assist Facebook group Latvian companies ran by young who want to export Latvian to the UK market. professionals Other bigger group /students. Focus: are the British

113

change the citizens with Latvian reputation of heritage like Latvians in the honorary counsels. UK. Other professional Latvian finance groups are: professionals in entrepreneurs; London City. media; musicians Focus: follow home politics, meet Latvian politicians in London, and attend Latvian cultural events. On the Ambassadors official visit to regions and regional cities in the UK, the Embassy and LIAA are reaching out to all Latvians living in that area. Latvian Diaspora invited to events: National day reception, industry specific events, meetings/dinners with Latvian government members.

France 2246 Expats are N/A N/A engaged in export supportive events; support for translation works (French- Latvian); finding of potential clients; and

114

resolution of dispute cases with local (French) enterprises.

Netherlands 5000 One of 6 There are a few Facebook participants in re- groups: students,; groups of emigration plan young professionals Latvian of Latvia is Lelde (often NL Diaspora; Caune from universities’ Letlandhuis.nl; Latvia. She works graduates), low Latvian at LIAA and plans skilled workers, Association in to continue after temporary workers the end of the re- in agriculture and Netherlands; emigration term. construction LIAA keeps sectors, master contact with students in business people technology/IT/HR in NL with Latvian etc; patriotic Dutch roots. that have married There exist Latvian attempts with professionals (from finding agents of experience they are Latvian design very into Latvia and products in plan to start Latvian Diaspora business or retire groups on social with tourism media. business in Latvia); IT/Creative professionals that have based their international activities in Amsterdam because it is FUN.

Norway Officially ~ Norwegian Mostly skilled N/A 10 000, Chamber of workers (not Latvian Unofficially ~ Commerce was managers). Latvians Association in 12 000 established by discover business Norway Latvian Diaspora. opportunities as LIDA office in LIAA Norway managerial Norway office helped with employees. Most of Oslo location for the Latvian Construction

115

events, seminars established Workers for start-ups. companies are small Association Resulted in size with up to 6 – Chamber of creation of 10 employees. Commerce companies like Norstrand Hagepleie AS Kebbe IT AS (IT solutions web design), GMM Bygg AS (construction and renovation), LABI Familiebarnehage AS (kindergarten). Ongoing consultancies in sectors of medical tourism, sales of textile, opening of bakeries, restaurants, import of Latvian products like Laima sweets, dried berries, ECO food etc.

Germany ~ 30 000 10 companies N/A Most Latvian N/A The established by expats – not embassy has a Latvians (mainly qualified persons small database family business or (construction of Latvian one-man- workers, parcel and expats who company); e.g. logistic service have provided cafeteria, workers, people their data restaurant, taking care of mainly to working as German seniors receive business etc.) information consultants or about cultural sale office for events. Latvian Confidential. companies. Involvement in LIAA activities (during trade

116

missions, seminars etc.) Without any results.

Singapore ~ 50 (mainly Diaspora Manager of global Facebook young members are very operations page: Latvians professionals, active and willing (telecommunication in Singapore in their 20’s- to facilitate field), logistic 40’s) economic manager (for all SEA relationships region), manager for between both train electrification countries. projects, IT One of the specialists, finance Latvian women specialists, business living in Singapore development was selling Lauma specialists in various and Rosme fields, students, lingerie; just housewives etc. recently, she sold her small business. Another woman is having her own accounting company.

Ukraine ~ 600 No single Banking and sales N/A (Russian organisation top managers. speakers, linking Latvians in active in Ukraine, networking) individual patriotic people.

China ~ 50 Diaspora does not Architects, Teachers WeChat group (Shanghai) engage into LIAA (arts, language, / impossible to professional sports, etc.), share that activities, but Translators, group contacts active at Entrepreneurs. via e-mail. receptions, dinners and other.

Table 3. Survey Results of Diaspora Engagement within LIAA.

117

LIAA Events for Diaspora engagement

To further research the status quo of LIAA’s engagement with Diaspora, the author has collected the list of LIAA Events in 2013 – 2015 that also reflect the current participation for Diaspora engagement:

 Oct. 23, 2013 - LIAA representative office in London organized Latvian business forum in London. After the forum, the minister of economics met with Diaspora working in London City, the event took place at the Embassy of Latvia in London.

 February 5-9, 2014 – Representatives from LIAA participated in the annual meeting of honorary consuls, organized by Embassy of Latvia in Washington, DC. LIAA gave two presentations, one about the investment and business environment in Latvia, available business incentives, Latvian companies with a potential export capacity to the US, and a second one about investment projects in Latvia that might be of interest to Diaspora living in the US as well as local American entrepreneurs.

 March 27-May 5, 2014 – During the visit of Prime Minister of Latvia to the US, LIAA organized meetings with Diaspora living in the US to foster economic ties between US and Latvia (Seminars in Boston and Philadelphia, organized by LIAA; 63rd Congress of The American Latvian Association, with a participation of over 100 Latvians living in the US).

 July 9-11, 2014 – LIAA organized US business mission to Latvia; a delegation of 30 business people from US, including those of Latvian descent; Industries represented: automotive, pharmaceutics, life science, IT, manufacturing of plastic wraps.

 Fall, 2014 – Participation of LIAA Director in an event organized by the Baltic Diaspora in Cambridge University. Baltic Conference ‘’Education and Innovation.’’ Targeted at Latvians, and students in particular living/studying in UK. LIAA director was a speaker on panel ‘’Does education foster entrepreneurship?’’ Other Latvian participants included former minister of culture and science Robert Ķīlis, former Rector of the University of Latvia Mārcis Auziņš and others. One of the goals of the conference was to encourage Latvian students return to Latvia after their graduation, as well as to help professionals working in education to expand on ideas for developing and improving the education system in Latvia.

118

 March, 2015 – during the Latvian President’s visit to Norway, LIAA organized a business forum, supported by Diaspora with 200 attendees, including Latvians living in Norway.

 July 9-10, 2015 – 2nd PLEIF (World Latvian Economics & Innovations Forum). Main organizers were PBLA (Federation of World Free Latvians) and The Ministry of Foreign Affairs of Latvia. LIAA also helped with organizing parts of the event.

After reviewing the current means of cooperation with Diaspora within LIAA, the author suggests taking a step forward to the diagnosis and conclusions part.

119

2. LATVIAN DIASPORA IN ECONOMIC DEVELOPMENT: FRAMEWORK AND RECOMMENDATIONS

2.1. DIAGNOSIS AND GUIDING FOR ENGAGING DIASPORA This chapter will focus on Diagnosis and Guiding of the Diaspora Engagement possibilities. Diagnosis defines or explains the nature of the challenge. Whereas the challenge is outlined by SWOT analysis of Engaging Latvian Diaspora in Latvian Business Development. Guiding policy describes how to deal with the challenge. 168

2.1.1. SWOT ANALYSIS OF ENGAGING LATVIAN DIASPORA FOR LATVIAN BUSINESS DEVELOPMENT

The below presented SWOT is based on the best global practices and situation analysis of Latvian cases of already existing Diaspora engagement within LIAA and other organizations as well as the potential for Latvian economy.

Internal External Strengths Weaknesses Opportunities Threats Established No CRM or Know your target Collecting network of LIAA database of better, create a information using foreign Diaspora system leading to formal and non- representatives Professionals tangible results. formal sources can and partners developed. be challenging. that already work with Diaspora or have the network. Existing cases of Existing doubt if Branding the Diaspora DDI or other the focus on initiative with engagement just Diaspora driven Diaspora could positive already like FDI attraction results in export bring tangible existing example, responds to

168 Rumelt, Richard P. (2011). Good Strategy/Bad Strategy. Crown Business.

120 facilitation or results. Cases of engaging successful favourable knowledge – DDI or other Diaspora members. business sharing. Diaspora driven environment. results in export Diaspora can be facilitation or demanding for knowledge - change in quality sharing are not of service. well communicated and understood. LIAA has already Creating a Identify priority Diaspora is very developed a process of single areas where diverse and it process how to window clearance Diaspora’s might be inquiring respond to the for Diaspora engagement is different priorities. needs of might be encouraged. Easy to lose potential challenging. direction. investors, exporters or entrepreneurs.

Table 4. SWOT Analysis.

Having in mind the existing challenges to tackle, here is a suggestion of the following scope of recommendations for the Guiding policy.

2.1.2. THE SCOPE OF RECOMMENDATIONS

After having presenting the SWOT Analysis, it is important to define the Target audience while dealing with Diaspora Engagement in Latvian economic development. It is recommended that Diaspora Engagement Strategy define ‘Diaspora’ as broadly as possible and should include affinity Diasporas policies where appropriate. Therefore, the broad definition of the target group is outlined below. Target audience

Professionals with international experience (such as industry leaders, world-class achievers, entrepreneurs, mid-career professionals, young leaders, students), connected by the sense of homeland Latvia (incl. Diaspora types such as Lived, Ancestral, Next generation, Affinity, Returning and Globetrotter) potentially able to

121 contribute for the purpose of investment promotion and economic development of Latvia. The suggestion of vision and mission that explains why there is a need to introduce Latvian Diaspora focus into LIAA’s activities is the following.

Mission statement and values Vision: Internationally well-connected Latvian economy with its businesses succeeding locally and globally with the help of its Diaspora.

Mission: Facilitate Latvian Diaspora engagement to promote investment, exports, entrepreneurship and other business development.

The following core value and approaches are suggested:

• International experience, connections and knowledge of Latvians abroad is an ASSET; • Mobility shall be addressed as an OPPORTUNITY not only as threat; • Direct Diaspora Engagement goes beyond FDI or trade promotion: it usually creates a positive CHANGE in home societies, including governmental approaches; • Networking with Diaspora is a PROCESS not a single action: requiring dedicated resourced especially relationship management and facilitation.

Based on the values above, here is a set out of four main LIAA’s strategic principles for engaging Diaspora:

1. facilitating the economic engagement of the Diaspora and local businesses; 2. preserving the Diaspora’s bonds with Latvian identity via professional engagement; 3. promoting cooperation with the Diaspora in business; 4. supporting those who wish to return to Latvia through DDI, entrepreneurship, career development, knowledge sharing or other.

2.2. FRAMEWORK OF THE DIASPORA ENGAGEMENT POLICY Following the existing challenges to tackle, outlined in the SWOT analysis of the earlier sub-chapter, this is the framework to lead the Guiding policy in response to the existing challenges. Below you will find important steps directing how to further work on Diaspora Engagement for country’s business development.

122

Below you will find the framework for starting Diaspora Engagement for Latvian business development.169 A. Build and Analyse Demographic Registry B. Create Branded Diaspora Initiative C. Target groups and priority sectors D. Measure results

A. Build and Analyse Demographic Registry This is the first step where a complete understanding of the potential Diaspora influence and its demographic information is captured. This can be analysed to develop targeted program. Analysing the Diaspora registry and proposing Diaspora networking strategy – are both important next steps to tackle Diaspora engagement opportunities. It is important to address certain target groups using different tactics, because working with Diasporas can be a sensitive business. The best practice examples show that countries that know their Diasporas well will be better placed to engage them.

B. Create Branded Diaspora Initiative

Diaspora engagement resulting in export leads development, DDI returns or other business impact, just like FDI attraction, responds to a favourable business environment. The Diaspora should see the real government's commitment. It is also very important that the new Diaspora initiative went with a positive brand image. Therefore, it is crucial to have and Action Plan together with the Branding and Communication strategy. For example, appointing successful Diaspora members as brand ambassadors would help to communicate and make sure that government's commitment meets the expectation and creates a positive brand image. members. An Action Plan should be followed by clear Result Measuring Methods to make sure tools are systematic and visible.

C. Target groups and priority sectors

Identify areas (such as IT or Business Process Outsourcing) where such DDI attraction or export and growth promotion is encouraged. Note that according to the already

169 Based on Diaspora Direct Investment (DDI) as a Development Tool methodology (IDB, 2010)

123 existing Latvian cases, DDI is especially useful in bringing in foreign investment in smaller chunks, which are more spread out than a single multi-billion dollar project. Thus, it has a wider impact on society. Such projects also bring in more skill transfer and knowledge than FDI projects.

D. Measure results

The process of the Diaspora’s interactions and later engagement in the exports promotions, expertise sharing, investment advisory or DDI, should be as smooth as possible. Enhancing the experience by promoting single window clearance can be highly effective. Offer a Plug-and-Play engagement tools for Diaspora target

2.3. POLICY RECOMMENDATIONS FOR ENGAGING LATVIAN DIASPORA

According the above framework, the below listed recommendations allow to have a more in-depth understanding of the overall Guidance framework suggested in the previous sub-chapter.170

 Promote Latvian Diaspora Initiatives  Leverage Latvian Diaspora Networks  Engage Stakeholders  Focus on win – win approach  Be Transparent  Create Process Framework  Resonate with the Latvia’s economic needs  Promote Diaspora Initiatives  Use the Global Business Language - Globish English  Top Attention from Latvian Government Leaders

Each of the recommendation is elaborated below. It resonates with the previous chapters describing best practices of other countries and Latvian specific information.

Promote Latvian Diaspora Initiatives

170 Based on Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

124

Create or/and support targeted initiatives to increase awareness among the Latvian Diaspora and bring them closer to home in the context of Latvian economic development. Facilitate or/and conduct business matchmaking between the Diaspora professionals and local entrepreneurs. Cooperate with already existing best practices in Latvia, such as World Latvian Innovations and Economic Forum.

Leverage Diaspora Networks

Tap into the Latvian Diaspora intellectuals and field experts/achievers - professionals in business, entrepreneurs, engineers, scientists, and knowledge workers. Encourage them to contribute to their country and promote investment. Leverage their influence to grow the knowledge services industries, mentor entrepreneurs, support exchange programs and other initiatives. Treat relationship management as a priority within LIAA. Use CRM for Diaspora relationship management, integrated with other organisation functions.

Engage Stakeholders

Diaspora strategy should be centralized enough to ensure that a common identity, sense of purpose, collective consciousness, economies of scale, and strategic priorities can be achieved, but loose enough to “let a thousand flowers bloom”. The Diaspora needs to be consulted before any Diaspora strategy is prepared. Diaspora strategy must be co-authored if it is to work. It is also important to communicate Diaspora Engagement Strategy for Latvian economic development to the key LIAA employees and other stakeholders, collect feedback and to further develop it. Involving and coordinating with the following Latvian stakeholders is highly advisable:

 The World Federation of Free Latvians, other formal and non-formal Diaspora groups;  Successful returnee and overseas entrepreneurs;  Ministry of Foreign Affairs of the Republic of Latvia;  Ministry of Economy of the Republic of Latvia;  Latvian Associated businesses, employer and academic organizations;  Other organizations such as influential informal business (e.g. Rotary Clubs, international expats in Latvia) or academic networks (e.g. Latvian scientists abroad).

125

Target audiences abroad: Professionals Partners: and entrepreneurs, Latvian Communities, Latvian communities and Diplomatic Missions of organizations, Youth Researchers Latvia NGO’s and partner

Ministry of institutions Ministry of Foreign Youth Education Affairs Engaging Diaspora for Economic Developing of Latvia Ministry of LIAA Economy

MP Diaspora Business Advisory Board Target audiences in LIAA facilitates the process of Latvia: business Diaspora Engagement for associations, Latvian Economy organizations, clubs, emerging entrepreneurs.

Figure 2. Institutional Framework of Diaspora Engagement for Economic Development

There is no ideal Insitutional framework for coordinating Diaspora strategies. Each country needs to devise forms of engagement, which reflect their own social, cultural, economic, and political needs, history, structures and organization of their Diaspora. Having analysed the Latvian case, here is the suggestion for LIAA’s role within the Institutional framework. The role could be shared and coordinated with the partner organizations such as Ministry of Foreign Affairs, the Government, business associations, Diaspora organizations or other.

Focus on win – win

Diaspora strategy needs to be mutually beneficial for both home country and diasporic target group. The ways to benefit Latvia and the Latvian Diaspora are to focus on the following:171

171 Based on Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

126

Latvia’s Country Benefits Latvian Diaspora’s Benefits

 Giving Back: be in touch with their  Helping to redefine value proposition, identity and make a positive assistance in increasing the brand value of change/contribution to their place of the country origin  Converting brain drain into brain gain  and brain circulation Need for identity and feeling of belonging  Acting as global ‘search networks’ for  Rewards and recognition developing local industry  Keeping track: be in touch of the  Assisting in the creation of global personal/professional network and knowledge networks to support the growth pursue career opportunities ( more of indigenous companies relevant to the New Generation  Contributing to the expansion of global Diaspora and Globetrotters) trade with their knowledge of home  country markets Speed-up the career home or pursue entrepreneurial opportunities when  Acting as ‘talent accelerators’ for the returned (more relevant to the New Latvia’s next generation through Generation Diaspora and mentoring, internships, and other training Globetrotters) and educational opportunities  Enjoy better conditions for work-life  Contributing to the economic progress of balance as well as culture/education the Latvia through financial space for growing children back in instruments such as remittances Latvia (more relevant to the New  Increasing the Latvia’s impact on the Generation Diaspora and international stage Globetrotters)  Other  Retirement in Latvia  Other

Table 5. Benefits of The Latvia's Country and Diaspora.

Be Transparent

While introducing a new focus of Engaging Diaspora for Latvian Business Development, LIAA needs to be transparent and open to be held accountable. Given the specificity and the many intangible benefits of policy interventions, distinctive and unique tools for policy impact analysis and evaluative frameworks and metrics need to be developed.

Process Framework

The Process Framework for Engaging Diaspora in Latvia is based on the relation between the Asset (Latvian Diaspora), Facilitator (LIAA) and Beneficier (Latvian economy players). It means that LIAA is suggested to mediate the knowledge transfer and relations that occur after matching Diaspora opportunities with local businesses and other stakeholders in the economy.

127

Figure 3. Process Framework for Engaging Diaspora.

Resonate with the Latvia’s economic needs

Latvian Diaspora Engagement for Business Development strategy needs to be underpinned by a grounded rationale, which resonates with the country’s economic needs. Shallow slogans might lead to short-term gains but might fail over the long term.

In order to draw conclusions on the priorities for engaging Diaspora, it is a necessity to create a database of the Target group and analyse it. Before that, a more simplistic approach can also be used (see below). However, it can be misleading, because the scope and content, investment or intellectual Diaspora potential in each of the geography is not revealed, nor estimated.

128

LIAA FDI Priorities Highly Diaspora Populated Countries LIAA Exports Priorities

Figure 4. Simplistic methodology for matching Diaspora with LIAA Priorities.

The methodology, shown in the Fugure 4 combines the mostly Latvian populated destination countries with the sectoral and geographical priorities of LIAA. The overlapping zones of the circles reflects the priorities of Diaspora engagement what concerns FDI attraction and exports promotion.

Since the priority countries for exports are not clearly listed within the “Guidelines for Promoting Exports of Latvian Goods and Services and Attracting Foreign Investment for 2013-2019”, the Table below suggest geographical and sectoral match for FDI Attraction. While the priorities for e xports are shown as sectoral priorities.

COUNTRY PRIORITIES FOR FDI ATTRACTION PRIORITIES FOR EXPORTS (~LATVIAN PROMOTION DIASPORA) (APPLIES TO ALL COUNTRIES)

UK (~ 100 000) Transport and logistics, Metal metal working and machinery; working and machinery, IT, Life wood production; sciences, Health care, Wood food industry; production chemical industry and its related

129

industries; USA (~96,000) Transport and logistics, IT, Life light industry; sciences, Health care, Wood printing and publishing industry; production construction, production of building materials; Ireland To be defined production of electric and optical (~25,000 to 30,000) equipment; transport and logistics; Sweden (~ 30 000) Metal working and machinery, IT, information and communication Health care, Wood production, technologies; Transport and logistics tourism; product/niche support approach Germany Metal working and machinery, IT, to support higher added value Health care, Wood production, (~ 30 000) Transport and logistics

Canada (~ 26 000) To be defined

Australia (~ 25 000) To be defined

Russia (~ 20 000) Health care, Metal working and machinery, Transport and logistics, IT, Wood production

Brazil (20 000) To be defined

Norway (~ 11 000) Health care, Wood production, Transport and logistics, IT, Life sciences

Table 6. Sample Priority Building of Latvian Diaspora Engagement for Business Development.

As outlined above (see Table 6), the matching methodology suggests Diaspora engaging policies focusing on such sectors as Transport and logistics, ICT, Life sciences, Health care, Wood production in the countries like UK and USA (where most of Diaspora is located). However, it is important to note that Diaspora can bring a larger value especially for supporting untapped destinations and sectors with higher added value. Therefore, it is advisable to consider such priority fields as high value manufacturing, global services, and research, development and innovation specifically in sectors such as services, digital media and consumer brands. Therefore the author suggests using this methodology (see. Table 6) only in line with the results of further Diaspora registry analysis. The overall more sophisticated data might show some new directions to follow.

Use the Global Business Language - Globish English

130

Most of the Latvian Diaspora organizations focus on sustaining Latvian language and culture and heritage. Therefore, usually the only working language is Latvian in many cases. However, when talking about the Diaspora focusing on Latvian business development and internalization, it is important to use the language for international business. Using Globish English (i.e. concept of the English language as a global means of communication)172 would act as an engaging invitation to Ancestral non-Latvian speakers and Affiliate Diaspora to join the network.

Top Attention from Latvian Leaders in Government, Businesses, Media

Countries succeeding in engaging Diaspora for their home economies, like Ireland, Scotland, Israel, New Zealand and others demonstrate a personal attention of the President, Prime Minister, other Government Officials and Business leaders that make personal efforts to engage those abroad. Such top-level attention would help to succeed in Latvia’s case as well.

For example, World Latvian Economic and Innovations Forum was attended by the President and the Prime Minister of Latvia. Following the second forum, Latvian Prime Minister Straujuma invited and chaired the first meeting of the Diaspora Businessmen Advisory Board.173 The level of such attention should also be transferred on to the further policies for engaging Diaspora into economy.

The next sub-chapter will go deeper into action priorities that are suggested by the author according to the previously outlines recommendations and the framework suggested.

2.4. RECOMMENDATIONS FOR ACTION PRIORITIES

This sub-chapter focuses on the action fields of engagement that shall be treated with the first priority, focusing on FDI, venture capital and youth. The mostly relevant action fields for LIAA are the following.

1. Encourage FDI and DDI:

172 Wikipedia on “Globish”: https://en.wikipedia.org/wiki/Globish

173 “Vienojas par konkrētiem soļiem diasporas uzņēmēju iesaistē Latvijas attīstībā”: http://baltic-ireland.ie/2015/11/33583/

131

ACTION LINE 1. Encourage FDI and DDI through a Network of Investment Advisors. 2. Attract venture capital and support local businesses to grow: ACTION LINE 2. Encourage exports and entrepreneurship via Network of Global Latvian Mentors. ACTION LINE 3. Encourage, facilitate or/and support World Latvian Awards. 3. Focus on young international professionals and students: ACTION LINE 4. Develop a talent placement program (-s) for young professionals with international experience. ACTION LINE 5. Target Latvians planning families and children. ACTION LINE 6. Encourage and support youth mentorship and talent acceleration programs. ACTION LINE 7. Treat New Generation Diaspora professionals visiting the homeland. 4. Look for Synergies within Existing Activities.

Possible focus on action of engaging Diaspora to home economy for LIAA and other institutions responsible for Latvian Economic Development might include those of realigning remittances, issuing Diaspora bonds, promoting Diaspora philanthropy. However, the three above mentioned priorities do not likely match the current needs and challenges to solve.174

2.4.1. ENCOURAGE FDI AND DDI TO LATVIA

The Latvian Diaspora can undoubtedly play a role in assisting homeland agency in the attraction of new inward investment and in building investments already made in the country. Ways in which they can be leveraged to bolster investment include the following:

 Helping Latvia to define its new value proposition.  Serving on task forces that are either sectoral, regional, or topic specific as a means of increasing the knowledge base of LIAA. They can provide insight into market dynamics, the competitive landscape, local laws, differences in the regulatory environment, etc.

174 Based on Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

132

 Assisting with the evolution of brand of Latvia and helping to position the country to succeed in today’s globalised economy. For example, developments in the USA, UK or other counties’ trade, investment and taxation policy could have a major economic impact on Latvia, and informed members of the Latvian Diaspora living in the USA can help to understand and potentially mitigate such changes.  Assisting with the understanding of key industry verticals and facilitating access to investment;  Making key introductions.175

As already analysed in sub-chapter ”Analysis of Diaspora Engagement within LIAA”, it has already developed global network of supporters. There is evidence that the agency could already rely on Diaspora connections whether as:

 Investors  Door openers  Introduction agents  Advisors and influencers

There are ways to strengthen that practice with a focus on Diaspora. Motivated by a desire to help their ancestral homeland many of them are willing to ‘go the extra mile’ and willing to ‘nudge’ a deal in favour of Latvia.176

A practical example of Diaspora driven FDI case

Gint Baukus, U.S born American Lithuanian, Senior Vice President of Talent Management at “Western Union”, assisted Lithuanian Government and “Invest Lithuania” to achieve the FDI attraction from “Western Union”. Here is his story.

In the initial stage of searching for host countries and exploring expanding opportunities in Western Union Head Office, one of the employees within “Western Union”, who knew Gint Baukus was Lithuanian, unofficially contacted Mr. Baukus. He told: “I know you are Lithuanian. We have Lithuania on the list among six other candidates, but we do not know anything about the country. Can you help

175 Based on Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

176 Taken from Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

133 us?” This was a start of involvement of Gint Baukus. Gint Baukus decided to inform Lithuania about the fact and help the officials prepare for the opportunity. Therefore, he first contacted his father, Mindaugas Baukus, active in the Lithuanian Diaspora organization in the U.S. to get connected with the Lithuanian Government. Finally, the Prime Minister Kubilius and the relevant institutions got involved and the whole process turn out to be a success.177

The European Regional Operations Centre (EUROC) of WU was established in Lithuania in 2010. The facility, which also serves as a Centre of Excellence, hosts Anti Money Laundering Compliance, Accounting, Digital, IT, HR, Marketing, Operations and various other functions. This centre supports Western Union to simplify and streamline business processes and improve operational productivity in pursuit of global strategies.178

ACTION LINE 1. Encourage FDI and DDI through a Network of Investment Advisors

The author advises to build a networking plan on how to engage these three different categories of advisors:

o Senior industrial / influencers (especially for targeted company visits and business missions for attracting FDI); o Pool of industrial experts; o Potential lead generators within international companies.

What concerns the potential “Lead Generators”, LIAA could consider rewarding Lead Generators. This model is practiced by “Connect Ireland”.179 Please see the sample scheme of a possible campaign in Latvia below.

177 Interview with Gint Baukus: http://www.plbe.org/plietuvis/pdf/new/PL_Balandis.pdf

178 Invest Lithuania: http://www.investlithuania.com/stories-to-share/ssc- outsourcing/western-union/

179 Connect Ireland: https://www.connectireland.com/

134

Sample campaign: Latvian Diaspora for Jobs Creation

The aim is to find a connection in a company that is expanding internationally and introduce them Latvian Expat to LIAA (consider branding). If that finds an FDI Lead introduction leads to jobs being created in Latvia, then a Connector will receive a minimum of €1000 (or Introduce company to any other sum) per job (to a LIAA maximum of number of jobs), subject to certain terms and conditions. The

1000 EUR reward can be used personally, reward per donated to a charity or waived as a created job mark of support for Latvia.

Figure 5. Latvian Diaspora for Jobs Creation Campaign Structure.

2.4.2. ATTRACT VENTURE CAPITAL AND SUPPORT LOCAL BUSINESSES TO GROW Usually countries’ innovation systems are widely dependent on venture capital. It plays a primary role in the entrepreneurial eco-system, providing long-term capital and expertise to support the development of young companies, especially in technology sectors, with the potential for fast growth.180

Diaspora can help attract venture capital funding

In addition to playing a critical role in helping to attract foreign direct investment, the Latvian Diaspora has an equally significant role to play in facilitating the flow of venture capital and investment in domestic growing companies and start-ups. Moreover, there is much the Diaspora can do to assist in the growth of indigenous companies, beyond the provision of monetary investment. To date, many countries, have done a reasonably good job at leveraging the Diaspora to aid in the development of indigenous companies, yet an opportunity clearly exists to develop a more

180 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

135 systematic approach to their engagement and a stronger sense of shared accountability. Other countries have also looked to leverage their Diaspora networks to further facilitate the flow of venture capital.

Examples of other countries

One of the leading countries in this regard is India. By the turn of the century, members of the Indian Diaspora in the US were playing a key role in developing the IT industry in India. They established the International School of Business in Bangalore. Many Indian professors in the US took sabbaticals to teach there. Many Indians returned and started hundreds of IT companies. Delegations of venture capital companies visited India from the US to explore potential investment opportunities (The Irish Leadership Technology Group in Silicon Valley has done this recently in Ireland). Many venture capital companies in the US require their start-up companies to have a back end in India in order to save on R&D costs. More than 300 start-ups have some form of back end in India and front end in the US. In 2007, the Ministry of Overseas Indian Affairs and the Confederation of Indian Industry established the Overseas Indian Facilitation Centre to expand the economic engagement of the Indian Diaspora with India and facilitate effective knowledge exchange. It aims to promote overseas Indian investments and facilitate business partnerships. Its stated vision is to be a one-stop shop for Global Indians to facilitate investment into India.

Another excellent initiative in engaging the Diaspora in facilitating the flow of venture capital and investment in domestic indigenous companies can be found in the Irish Technology Leadership Group (ITLG). An important way in which the Diaspora can act is as a conduit of investment capital to indigenous industry. Israel is at the top of the league tables in this respect and has an enviable record of accomplishment of success in linking its international Diaspora to home-based companies. Through a variety of programs, Israeli companies have broader access to venture capital funding, knowledge of export markets, assistance with IPOs, etc.181

The Diaspora as Entrepreneurs

181 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

136

It has been said that the value of venture capital lies ‘in providing not only money but also ancillary services, such as selecting good firms, mentoring entrepreneurs, hiring executives, formulating strategies, and ‘professionalizing’ companies. ‘The Diaspora can role a fundamental in both providing investment to start-up companies in the homeland but, moreover, in providing the ancillary services.

The Indus Entrepreneurs (TiE) was founded in 1992 in Silicon Valley by a group of successful entrepreneurs, corporate executives, and senior professionals with roots in the Indus region. There are currently 13,000 members, including over 2,500 charter members in 61 chapters across 18 countries. TiE’s mission is to foster entrepreneurship globally through mentoring, networking, education, incubating, and funding. Dedicated to the virtuous cycle of wealth creation and giving back to the community, TiE’s focus is on generating and nurturing our next generation of entrepreneurs.182

ACTION LINE 2. Encourage exports and entrepreneurship via Network of Global Latvian Mentors

Following the best practice, author advises to attract venture capital, support innovation and international growth of companies by the following actions:

o Encourage and facilitate Global Latvian Mentoring/Export/ Entrepreneurship Advise Network focusing on transfer of international expertise to local businesses; o Focus on R&D and sales as the most common expertise fields of Diaspora members; o Corporate with established players of start-up ecosystem (e.g. accelerators, hubs, VC funds).

Sample program: Global Latvian Mentors/Export Advise Network

Latvian Latvian LIAA facilitates companies, international mentoring emerging professionals platform innovators and entrepreneurs, exporters

182 http://tieglobal.newswire.com/browse/about

137

Figure 6. Latvian Diaspora Mentoring Network.

Global Latvian Advisors Program - connecting international Latvian experts passionate about helping Latvian businesses to get ahead. Global Latvian Advisors program could bring together Latvia’s most successful and experienced international professionals to advice to Latvia’s growing companies, emerging innovators and entrepreneurs. Latvian Business Advisors are experienced over-achievers from leading global business and academic organizations. They dedicate they time to advise Lithuanian companies on general and specific topics according to their essential needs.

The program should be an integral part of the LIAA’s service to Latvian businesses. In order to have an easy kick-start the support and further development of the World Latvian Mentoring Program183 could be a strong option to consider.

Cooperate and strengthen existing initiatives that demonstrate results, such as World Latvian Economics & Innovations Forum: participate in content creation, support implementation, follow up with matchmaking opportunities, and facilitate results with relationship management.

ACTION LINE 3. Encourage, facilitate or/and support World Latvian Awards The author advises rewarding the remarkable talent, exceptional vision, and responsible ambition of Latvians and Latvia-connected people who have been contributing to the prosperity and global standing of Latvia. LIAA could engage top Latvian Leaders to patron and support the awards.

2.4.3. FOCUS ON YOUNG INTERNATIONAL PROFESSIONALS AND STUDENTS

Attracting Diaspora students and young professionals

Many countries, in their efforts to attract international students, are also focusing on targeting Diaspora members to study in the homeland by offering financial incentives to do so. For example, the Indian government offers a special scholarship program for the children of persons of Indian origin (PIOs) and non-resident Indians (NRIs) to pursue undergraduate professional and general courses in India. The scholarship is open for undergraduate courses in disciplines including engineering, architecture,

183 World Latvian Mentoring Program :http://www.ieguldilatvija.lv/world-latvian- mentoring-program/

138 technology, liberal arts, commerce, sciences, and law except for medical and related courses. The scholarship offers 75% of the institutional economic cost or US$3,600, whichever is less.

Similarly, the Ireland Homecoming Study Program which was launched in 2010 is a new initiative that is open to the children, grandchildren and greatgrandchildren of Irish emigrants who are interested in completing a semester of study, two semesters or an entire undergraduate degree at one of Irelands Institutes of Technology. Students who qualify will benefit from the new ‘Irish Diaspora tuition fee which is up to 40% less than the standard rate for non-EU students. For the first time the Irish Diaspora have been recognized and rewarded by the Irish state through the creation of a reduced tuition fee for the (non-EU resident) Irish Diaspora. Students also have the opportunity to live with Irish families during their stay in Ireland, further adding to the student's cultural experience and strengthening the student's cultural link with Ireland. Twinning programs between schools in host and home countries are also becoming increasingly popular. 184

ACTION LINE 4. Develop a talent placement program for young professionals with international experience

Evaluate the recourse and possibilities of LIAA to develop talent placement program. Here is a case example from Lithuania:

“Wings” - Young Export Leaders program by “Enterprise Lithuania”. Issues tackled involve:

 Lack of competent professionals in the regions;  Youth emigration;  Lack of export knowledge.

The main Challenge: To identify young people career opportunities in small and medium enterprises (SME) in regions. To develop future export leaders in Lithuania to increase country’s competitiveness in the long run.

184 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

139

Below you can see the process of the program:

Figure 7. Process of “Wings” Program by Enterprise Lithuania.185

Other examples of placement programs are led by “Invest Lithuania” and Global Lithuanian Leaders. “Create for Lithuania”, a one-year work placement program for young professionals launched by Invest Lithuania in partnership with the Lithuanian Government. It aims at Lithuanian youth who have completed their studies at universities outside of Lithuania and want to work for government.186 It is worth looking deeper at the impressive results of this program.

During their year of work, “Create for Lithuania” participants submit proposals suggesting reforms or policies that should be adopted. So far, almost 300 proposals have been submitted by young professionals on the programme. They address topics as diverse as the improvement of the investment environment, the promotion of

185 “Wings” by Enterprise Lithuania: http://www.intracen.org/uploadedFiles/intracenorg/Content/Trade_Support_Institu tions/TPO_Network/Redesign/2014/Documents/Simone%20Gailiunaite%20- %20Young%20export%20leader's%20programme%20'WINGS'%20in%20Lithuania.pd f

186 Create for Lithuania: http://kurklt.lt/en/

140 entrepreneurship, the enhancement of social security and competitiveness, the improvement of Lithuania’s image abroad, and the promotion of citizenship. Many of these proposals have been implemented. One example is an amendment to Lithuania’s migration laws which is now enabling Lithuania to attract highly qualified foreign specialists. In another case, modifications of the Labour Code have reduced the administrative burden placed on businesses.

Other examples include Lithuania’s first ever bio-bank, a deposit system for plastic and tin drinks containers, and a feedback assessment model that is enabling the public sector to improve the services it provides for businesses. And it is this ability to use their experience to affect lasting change in Lithuania that has motivated so many to join the programme. Most participants of the Create for Lithuania scheme are graduates of prestigious global universities who had other career opportunities abroad.187

Another similar program “Talents for Lithuania” for young professionals was launched by Global Lithuanian Leaders in partnership with businesses. It is aimed at Lithuanian youth who have completed their studies at universities outside of Lithuania and want to work for businesses.188

In LIAA’S case, it is important to strengthen the already existing program for trainees "Employment in the Public Administration" organized by the State Chancellery. It calls upon Latvian young professionals abroad people apply for a trainee program "Employment in the public administration." In 2015, the program has enrolled six young people. Trainee program "Employment in the Public Administration" is organized in accordance with the migration return supporting action plan 2013 to the 2016 and aims to attract "highly skilled workforce". 189

However, LIAA could strengthen the program with an alternative business oriented model, where businesses are also involved in offering placements. The example of the above mentioning Lithuanian “Create for Lithuania “ and “Wings” programs could be one valuable sample alternative.

187 “Top young professionals returning to build Lithuania”, 2015://en.delfi.lt/global- lt/top-young-professionals-returning-to-build-lithuania.d?id=67420680

188 Talents for Lithuania: http://stazuokis.lt/

189 Izsludināta pieteikšanās stažieru programmai “Darbs valsts pārvaldē”: http://www.es.gov.lv/news/izsludinata-pieteiksanas-stazieru-programmai-darbs- valsts-parvalde

141

ACTION LINE 5. Target Latvian youth planning families and children

Those who were in their mid-20s when they emigrated in 2009 and 2010 may be heading into their 30s now, and facing decisions about whether to buy a home take that next career step or have children. Action from the Latvian government could include not only highlighting opportunities (stressing the life-work balance) in Latvia but also committing to minimizing “logistical local challenges" - such as having qualifications and driving licenses recognised, and accessing affordable housing, accessing school places etc.190 Note that this action requires a broader involvement of the State decision makers and political will.191 There already exists an Affordable housing programme, however not specifically for people emigrating back to Latvia, but available for any young families with children.192

Therefore author’s suggests focusing on minimizing the beaurocracy of international expats returning from abroad (such as recognizing non-EU driving licences and other documents), as well as building the branding of Latvia as an “international expat friendly country”.

ACTION LINE 6. Encourage and support youth mentorship and talent acceleration programs

LIAA could encourage Youth career mentorship and career advice facilitation to youth inside and outside Latvia. It could complement it’s existing mentoring program within LIAA’s Innovative Entrepreneurship Motivational Program. Adding Diaspora angle would add extra international angle to the existing activities, where experienced business experts - mentors - voluntary work with practicing entrepreneurs and business beginners in their initial stage of operation.

Case study from Lithuania

190 Based on Ireland’s case “Will Irish Emigrants Come Home” (Irish Times, November 2015) : http://www.irishtimes.com/life-and-style/generation- emigration/destinations/returning-to-ireland/will-irish-emigrants-come-home- 1.2230931

191 From a Qualitative intervew with Andris Berzins, TechHub Riga Founder by Dalia Petkevičienė, Octorber 2015

192Atbalsta programma ģimenēm ar bērniem mājokļa iegādei vai būvniecībai: https://em.gov.lv/lv/aktuali/2032-atbalsta-programma-gimenem-ar-berniem- majokla-iegadei-vai-buvniecibai.

142

LT Big Brother, Lithuanian City of London Club led Global mentoring program for students by young professionals. LT Big Brother is the first and the only global voluntary professional mentoring program for Lithuanian students around the world. The main goal of the project is to facilitate transfer of professional knowledge and experience between established Lithuanian professionals (Big Brothers/Sisters further referred as BB/BS) and ambitious Lithuanian students (Small Brothers/Sisters further referred as SB/SS). With this goal in mind, we help fellow Lithuanians to nurture their professional skills as well as contribute towards development and creation of a better future for Lithuania.193

Partnering with existing youth Diaspora and local organizations could be a solution for kick-starting the activity.

ACTION LINE 7. Treat New Generation Diaspora professionals visiting the homeland

Author advises to focus on professional networking with the New Generation Diaspora coming home for Christmas, Easter or/and summer holidays. LIAA can provide opportunity to network and get connected or support/facilitate networking events, job fairs and other.

LIAA should be visible at Diaspora Youth festivals while promoting career and entrepreneurial opportunities in Latvia. A potential starting platform might be World Latvian youth camps 2X2 or 3X3, where a better focus on “career/entrepreneurship opportunities in Latvia” perspective could complement the events.194 The primarily goal would be introducing youth with foreign experience to Latvian business, Latvian start-up projects, and business opportunities in Latvia.195

To set an example, World Lithuanian Youth Summit and Festival focuses the areas of business, politics, science and culture with 3700 participants from Lithuania, US, Canada, UK, Germany, Scandinavian countries, France, Russia, Ireland, Indonesia,

193 LT Big Brother Program: http://www.ltbigbrother.com/

194 From a Qualitative intervew with Raimonds Kulbergs Funderful Founder by Dalia Petkevičienė, Octorber 2015

195 New-look 2×2 camp focuses on young Latvians by Daina Gross, 2006, (LatviansOnline): http://latviansonline.com/new-look-2x2-camp-focuses-on-young- latvians/

143

Hong Kong etc. “Enterprise Lithuania” is an active partner in the Career Fair during the event. 196

2.4.4. LOOK FOR SYNERGIES WITHIN EXISTING ACTIVITIES

After outlining the main priority action lines of engaging Diaspora for economic development, it is important to note that the action lines should have a synergetic effect (where possible), when implemented in line with the existing LIAA programs.

For example, the above-mentioned action lines connected to entrepreneurship, youth motivation and mentoring could be integrated into LIAA’s Innovative Entrepreneurship Motivational Program. Adding Diaspora angle would complement the existing activities of Mentoring program, Consulting business ideas and start-ups, Demola Latvia, Networking Seminars, Expert panel discussions and workshops.

196World Lithuanian Youth Summit Camp: http://pljs2014.lt/

144

3. CLOSING REMARKS

Members of Diasporas require individualized strategies of engagement since they have different backgrounds, motivations and connections. This paper offered recommendations for Latvian Diaspora engagement strategy with respect to that.

Many Diaspora initiatives have not been successful because they did not identify the highly motivated individuals who were willing to stick with the initiatives for a long time, battling against the odds and lending creditability to it. Therefore, the study has also focused a lot on segmentation of Diaspora and adapting the right strategies.

The strategy on Latvian Diaspora have purposes from increasing overall awareness of a country to generating economic engagement among the relevant members of the Diaspora for the express intent of improving trade, investment, innovation and industrial development.

The strategic analysis goes deeper into the specific case of Latvian Diaspora and the existing needs in the economy and the institutions covering its development. It is important to note that in order to finalize Diaspora Engagement Strategy for Latvian Business Development a more sophisticated further analysis is needed. It should include such steps as:

 creating and analysing the Diaspora target database; developing Diaspora networking strategy;  preparing Diaspora engagement branding and communication strategy;  creating action plan and proposing result measuring recommendations.

The above outlined supplements to the strategy will lead to a more successful implementation.

Some countries strategically and systematically engage the Diaspora and design a policy that harmonizes current and future initiatives. However, what will distinguish success from failure in any Diaspora strategy will finally be one thing – excellent execution.197

197 Kingsley Aikins, Nicola White Global Diaspora Strategies Toolkit (Diaspora Matters, 2011)

145

LIST OF QUALITATIVE INTERVIEWS

 Peteris Elferts, Ambassador-at-Large for the Diaspora, Ministry of Foreign Affairs (meeting)  Ilze Goroza, Secretary General, PBLA (skype)  Dr. Inta Mieriņa, Scientific Director, University of Latvia (e-mail)  Andris Berzins, Entrepreneur (meeting)  Aija Lulle, Director, Centre for Diaspora and Migration Research, University of Latvia (skype)  Džineta Dimante, Associate Professor at University of Latvia (e-mail)  Raimonds Kulbergs, Funderful – Alumni Fundraising Tool Co-founder (meeting)  Sanda Brūna, Deputy Director for Youth Ministry of Education and Science (meeting)  Interview survey of LIAA Representatives on Diaspora Engagement

146