Exclusive: Rēzekne SEZ Turns West: 40% Export Surge as Markets Shift Beyond Russia

FTZ News: Rēzekne Special Economic Zone is reshaping its investment and export strategy as companies operating in the Latvian zone adjust to a business environment transformed by the war in Ukraine. In 2025, exports reached more than €120.5 million, up 40% from the previous year, while total output rose to €136.7 million. The zone is now looking to attract new investment, modernize production and expand its presence in international markets, including the EU, United States, United Kingdom and Japan. In an exclusive interview with FTZ.news, these developments, along with tax incentives, infrastructure, employment and the zone’s operating framework through 2050, were discussed by Santa Kuzņecova, Office Manager and Acting CEO of the Rēzekne Special Economic Zone Authority.


1. What were the zone’s export, output, and import values separately in 2024 and 2025, and is the 2026 forecast based on signed contracts or on an internal target?

The figures show strong growth in both production and exports.
In 2024, companies operating in the Rēzekne SEZ recorded:
Export value: EUR 86,073,163 Output: EUR 111,819,583 In 2025, the corresponding figures were:
Export value: EUR 120,510,698 Output: EUR 136,723,872 This means that between 2024 and 2025, the value of exports increased by approximately 40%, while total output increased by approximately 22%.
We do not collect import data from SEZ companies, so we cannot provide a reliable aggregate figure for the zone.
We also do not consolidate company-level forecasts based on signed contracts and therefore do not have an official SEZ-wide export or output forecast for 2026. The figures available to us reflect actual performance through 2025.
 
2. How many people work inside the zone today? Does that figure cover member companies only, or the whole chain? From 2022 to now, how many net jobs have been added on an average annual basis?

The employment figure we use refers to employees of companies holding Rēzekne SEZ status. It does not include indirect employment in suppliers, logistics companies, service providers or other businesses connected to the SEZ companies.
In 2022 - 1 366 employees
In 2023 - 1 322 employees
In 2024 - 1 268 employees
In 2025 - 1 282 employees
This represents a net decrease of 84 employees over the period.
However, the employment trend needs to be understood in the context of technological development. The reduction in employment has largely been associated with increased automation and the introduction of more efficient production technologies, rather than simply a contraction of business activity.
At the same time, the employment picture is changing again in 2026 as new companies receive RSEZ status.
Two companies - SMART Interior and VTI Avoti - have joined the RSEZ community in 2026. In particular, VTI Avoti employed 40 people in 2025 and plans more than EUR 1.3 million of investment in production modernisation and capacity development over the next five years.
The current full-year 2026 employment figure is not yet available.
If employment in 2026 remains broadly at the 2025 level, adjusted for the additional companies joining the SEZ, the estimated figure would be approximately 1,331 employees.
The broader point is that Rēzekne SEZ is seeing a shift from labour-intensive production towards more automated and technology-driven manufacturing. That means employment numbers alone do not fully capture changes in productivity, output or the technological sophistication of the companies operating in the zone.
 
3. What are the three strongest items in the package you put in front of a foreign investor today — and which item has actually brought in a client, rather than remaining only in the brochure?

today, we would describe the Rēzekne SEZ investment proposition through three practical advantages.
First: tax incentives.
RSEZ companies can benefit from significant tax incentives when they meet the applicable investment requirements. These incentives can support long-term investment and improve the overall business case for investors.
Second: industrial infrastructure and space for expansion.
The Rēzekne SEZ covers approximately 1,155 hectares, including existing and former industrial territories as well as undeveloped areas suitable for future investment. We can offer access to industrial sites with existing infrastructure, as well as opportunities for future expansion.
Third: active cooperation and flexible business support.
We work closely with companies to understand their development needs and identify practical solutions. This includes flexible support through the Rēzekne SEZ Commercial Activity Support Fund, as well as assistance with employee training and skills development. Our aim is to support not only the establishment of new businesses, but also the growth and reinvestment needs of existing companies.
Lorvila (joined in 2025) case is a concrete example of how this approach works in practice.
We were able to respond quickly, provide consultations and approve SEZ status before the company made its initial investments. The company recognised the potential benefits of SEZ status and is now using support from the Rēzekne SEZ Commercial Activity Support Fund, as well as an SEZ grant to install new sewing machines.
Lorvila employs 21 people, produces approximately 1,700 raincoats per month and exports around 99% of its production to the United States, the United Kingdom and EU countries. The company plans to invest EUR 240,000 in equipment and more than EUR 550,000 in projected wage payments.
This example shows that a combination of incentives, quick decision-making and practical support can translate into concrete investment, employment and export results.
 
4. What direct effect did Russia sanctions and the war in Ukraine have on your orders, routes, and insurance, and what indirect effect did they have on the workforce and on hesitant investors?

The war in Ukraine fundamentally changed the operating environment for some companies in the region whose main target market was Russia and Belarus.
For companies with previous exposure to Russia and Belarus, the most immediate consequences included the loss or disruption of markets, the need to redesign logistics routes, increased transportation costs and greater uncertainty around supply chains and insurance.
The indirect effect was equally important: investors became much more focused on geopolitical risk, supply-chain resilience and access to stable international markets.
This has accelerated a process that is now visible across the SEZ: companies are looking beyond the traditional eastern markets and developing customers in the EU, United States, United Kingdom, Japan and other destinations.
For us, market diversification is therefore not simply a response to the war. It has become part of the long-term investment and development model.
 
5. Since 2022, how many export contracts moving through the zone have gone to destinations other than Russia or Belarus?

We do not consolidate the number of individual export contracts by destination, so we cannot provide a reliable aggregate number for all contracts since 2022.
In 2025, 11 RSEZ companies exported their products to EU countries, the United States, Japan and other international destinations.
For example, OptoElektronika LV reported an export share of 100%, LORVILA 99 %, while NewFuels reported approximately 99.2% and LEAX Rēzekne approximately 96.2%.
These figures confirm that RSEZ companies are active in international markets. However, the available reporting data do not allow us to determine the exact number of export contracts directed specifically to destinations other than Russia or Belarus.
 
6. What is the 2030 plan, and which international yardstick — inbound capital, exports, or jobs — will you use to measure it?

Our development direction towards 2030 is straightforward: more investment, stronger exports, modernised production and sustainable employment in the region.
The strategic priorities are set out in the Rēzekne SEZ Development Plan 2025–2035, focusing on infrastructure development, investment attraction, industrial growth, international recognition and support for existing companies.
We will measure progress through several key indicators, including the volume and quality of investments attracted, export growth, new and sustainable employment, the development of modern industrial infrastructure and the expansion of companies operating in the SEZ.
Our focus is not only on attracting new investors, but also on helping existing companies grow, reinvest and become more competitive in international markets.
For us, success means creating a stronger industrial base in Rēzekne, with companies that generate investment, employment and exports while contributing to the long-term economic development of Latgale.
 
7. What live data can a foreign investor see on your site or dashboard today that was not available in 2022?

today, investors can access more structured information about the SEZ through the Rēzekne SEZ website, including information about investment opportunities, the SEZ territory, available support, tax incentives, legislation and companies operating in the zone.
The objective is to make the investor's first questions easier to answer: Where can I invest? What infrastructure is available? What incentives apply? What companies are already here? And who can help me move the project forward?
 
8. The 80 percent tax relief is also on the English-language site. Which country was the last foreign investor from who read the file through and wired investment funds?

Tax incentives remain one of the practical components of the Rēzekne SEZ investment proposition.
The current framework allows eligible SEZ companies to receive an 80% corporate income tax reduction on dividends, while the applicable investment-related rules can also provide for reductions in real estate tax. The actual level of support depends on the investment and applicable state-aid intensity.
The most recent international enquiry came from Canada, from an investor interested in learning more about the benefits of Rēzekne SEZ.
Where relevant, we would distinguish between the country of the investing legal entity and the ultimate beneficial owner's country.
 
9. Last year the zone itself said geopolitical tension had cooled appetite and that a new carrot had to be built. What is that carrot, and when did it become law or an official rule?

The most important recent development is not a short-term promotional incentive, but greater long-term certainty and predictability for investors.
On 26 February 2026, the Latvian Parliament (Saeima) adopted amendments extending the operating period of the Rēzekne, Latgale  and Liepāja Special Economic Zones until 31 December 2050.
For investors, this is important because industrial investment decisions are made over many years. A longer legal horizon provides greater stability and predictability for companies considering establishing production, expanding existing operations or making significant capital investments in the region.
Under the updated framework, RSEZ companies can:
conclude investment agreements until 31 December 2035; implement the investments covered by those agreements until 31 December 2040; benefit from the applicable direct tax incentives until 31 December 2050; operate within the SEZ framework until 31 December 2050. The extension was specifically presented by the Saeima as a measure aimed at promoting entrepreneurship and investment in the regions. The rationale was that extending the SEZ operating period provides businesses with the long-term stability and predictability needed to attract new investment, develop production and create jobs in the regions.
For Rēzekne, this is particularly relevant. An investor deciding whether to establish or expand manufacturing needs to know that the rules and investment framework will remain in place over the lifetime of a major project.
So, if we describe the “carrot” in practical terms, it is not simply a larger tax discount. It is a longer and more predictable investment horizon, combined with the existing SEZ tax incentives and investment support framework.
But still we have an ongoing work now to extend the available tax incentives and other support mechanisms and instruments. 
 
10. According to Latvian media, five companies have left the zone since the war in Ukraine began, and Rebir’s shareholder put in the minutes that the Russian market had closed. Do you sign that same sentence? If not, what cause of exit do you write down?

Since 2022, four companies have lost their Rēzekne SEZ status, rather than five. The circumstances differed from one case to another, so it would not be accurate to attribute all four cases solely to the war in Ukraine or the closure of the Russian market.
The first one SIA Heli Energy had leased land and planned to implement a tyre-recycling project, but the project was not launched because the company was unable to secure financing.
RSEZ REDIUS SIA and RSEZ LATION SIA lost their RSEZ status due to long-term failure to fulfil the obligations established in their agreements, including requirements related to investment projects, business development and the provision of information to the Rēzekne SEZ administration.
REBIR RSEZ AS lost its special economic zone status in connection with the company’s ongoing liquidation process. The closure of the Russian market was mentioned in the shareholder meeting minutes as part of the company’s business circumstances.
The war and the disruption of the Russian market were part of the wider economic environment, but the formal circumstances behind the loss of RSEZ status were different in each case.

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