Latvia as an AI development center - the experience of leading companies in the field. Part. 2

A member state of the European Union located in the Baltic region and a leader in digitalization, in recent years Latvia has been expanding its ambitions and reinforcing its position in artificial intelligence (AI). While major US corporations are currently cautious in introducing AI solutions in Europe due to relatively stringent regulations, as a small country Latvia can provide the most important elements for AI development – knowledgeable experts and flexible, fast testing of AI solutions. What is the experience of leading companies in the field in Latvia?

Digital infrastructure in Latvia:

- 93.1 % of all households have an internet connection (2023)

- 91.5 % regular internet users

- OECD leader in mobile data usage

- one of the first to introduce 5G internet technologies

Quick decision-making and unique expert knowledge

Time is often the most important factor in creating AI ideas, and Latvia has something to offer in this regard. Uldis Tatarčuks, Chair of the Board at telecommunications company Tet, emphasizes that, in Latvia, the combination of our business and regulatory environment with a concentration of talent results in the opportunity to rapidly develop solutions and experiment with prototypes within a relatively small territory. 

 “We may not be the biggest country in the world, but Latvia knows how to play to its strengths – that being a combination of speed of decision-making, quality of communication and unique expert knowledge. Latvia has cultivated a strong culture of innovation, which allows for the development of artificial intelligence solutions that are sought after from around the world. We are already using original new solutions in language processing, smart city solutions, solutions in agriculture and other sectors. We understand that one of the keys to success lies in cooperation and therefore we are looking for partners around the world, including in the United States, to achieve ever higher goals together,” says Mr. Tatarčuks.

Mr. Binde, President of LMT, points out that there are currently 10 different 5G testbeds in Latvia where new applications of technologies can be prototyped and confirmed in a real environment.

“The advantage of Latvia as a small country is its strong innovation ecosystem where testing and demos of various technologies can be arranged very quickly. The experience of LMT shows that in many cases 5G industrial application tests which could take up to 3 years in other countries with obtaining all the various authorizations and finding partners, can be done in a matter of months or, in urgent cases, even weeks in Latvia. That is one of the reasons why NATO’s central 5G exploration event will take place in Latvia for the third year already,” highlights Mr. Binde.

Several areas which LMT is currently exploring in Latvia entail broader use of 5G which is also the foundation for further development of 6G. “As regards wireless AI, we are currently working on AI applications for more efficient use of network infrastructure, various edge computing solutions, such as computer vision enhanced urban traffic management. Furthermore, LMT is working with Open Networks, on various emerging applications, such as drone technologies and 5G coverage and maritime applications on vessels and at ports. A priority research area for LMT is 5G positioning as an alternative to GPS, as well as digital twin solutions where various IoT sensors play a major role,” Mr. Binde, President of LMT, says.

Successful AI products for export

Ēvalds Urtāns, founder of the Latvian Artificial Intelligence Association, stresses that Latvia's edge over bigger countries is speed which was also the key to success in introducing optical internet, 5G etc. 

“In AI, all countries start from the same level. Surveys show that only 8% of companies in Europe employ artificial intelligence in their business processes, but this indicator will certainly go up. Latvia can offer its US partners something more: a window to the European market, which is extremely limited. In Latvia, we can create an environment where the AI Act and the GDPR are seen through the prism of promoting innovation, we can serve as a launch pad to the European market. Our country is already working on minimizing red tape for business; we are seeking out ways to attract funding,” Mr. Urtāns says. 

From the local Latvian companies that are exporting AI products, Mr. Urtāns especially highlights robotics company Giraffe360 which is automating real estate sales processes and recently received an investment of USD 16 million. The technology developed by the company helps realtors create quality visual content for advertisements using their proprietary 3D room scanning cameras. This lets you generate a precise floor plan, high-quality pictures and a virtual tour as well as other digital content such as a 3D point cloud all with just the click of a button. Other Latvian AI companies to note are SquadRobotics which exports autonomous robots for maintenance of airports and supermarkets, ZippyVision which exports automated plank sawing systems, and PitchPatterns and Eldigen which automate intellectual work at large telecommunications companies. 

AI is also actively being used in the healthcare sector in Latvia. Projects are being developed focusing on analysis of medical data, diagnostics and customized treatment methods. For example, Latvian AI developer Apply has, in collaboration with radiologists, created a tool called Synapse for early detection of ischemic strokes with an 80% effectiveness rate to help prevent permanent health damage and even death. 

Advanced language technologies

In the area of AI, Latvia is especially well-known for the language technologies developed here. Latvian language technology company Tilde has created several AI-based language technologies, such as machine-translation systems and voice recognition technologies. An especially recognized one is its translation tool for the Presidency of the Council of the EU, which provides secure translation of texts into all 24 official languages of the EU, as well as machine-translation services for several EU presidencies. Latvia is especially proud that Tilde received the grand prize in the Large AI Grand Challenge held by the European Commission, attesting to its abilities in creating large language models that can, in certain applications, compete with ChatGPT and similar global solutions.

A major player on the regional market

As is the case in other EU member states, Latvia, too, faces several challenges in the area of AI: a shortage of resources and good managers, a fight for the skilled specialists. Moreover, innovations need to be expanded to scale, which can be accomplished working together with foreign partners while providing them with a comfortable environment to develop and approbate solutions.

“The prospects for Latvia’s AI development are promising. Active work is being done to introduce new technologies both in the public and the private sector. With a strong academic foundation, state support and a growing start-up environment Latvia is looking to becoming a major player in the regional AI market,” emphasizes Mr. Ozols.

Information material prepared with the support of the Recovery Fund. The author is solely responsible for the content of this publication. The views expressed herein do not reflect the official position of the European Union or the European Commission.