MOSCOW, July 5. /TASS/. Latvia’s new fee of 5,000 euro for foreigners willing to extend their resident permits will have an adverse impact on investments to the republic, Russian Ambassador to Latvia Alexander Veshnyakov told TASS on Tuesday.

Six years ago, Latvia amended its immigration laws to grant foreign citizens investing in real estate in Latvia a possibility to obtain a residence permit and hence stay and move freely within the Schengen zone. "In the past five years, Latvia has earned more than one billion euro in such investments," the Russian ambassador noted. "It has revived the construction sector, including in Riga and Jurmala."

He said that about 80% of foreign investors in Latvia are Russian citizens. "This program has been rolled back in the recent time," he said. "Residence permits were granted for a term of five years and now those applying for extension have learnt bad news from the Latvian authorities - a new fee of 5,000 euro has been imposed on each one seeking extension of his or her residence permit. It will discourage investments to Latvia and will have a negative impact of the country’s economy in general."

The program ‘residence permit in exchange for investments’ has been in place in Latvia since July 1, 2010. In a period from July 1, 2010 to July 1, 2014, investments in the Latvian economy reached 1.017 billion euro. A total of 95% of applications for residence permits came from the countries of the Soviet Union.

Amendments to the immigration law fixing the minimal sum of investments in real estate needed for obtaining a residence permit at 250,000 euro came into force in Latvia from September 2014 entailing a more than eight-fold slump in interest to the program in 2015 on the previous year.

In early June, Latvian lawmakers passed more amendments to the immigration law imposing a 5,000 euro fee on those willing to extend their residence permits.