RIGA, June 10 (LETA) - The Ministry of Economics plans to reallocate about EUR 1.5 million to strengthen the Latgale tourism industry, Minister of Economics Viktors Valainis (Greens/Farmers) said in an interview with the Latvian Radio on Wednesday.

He said that according to the methods agreed with the sector, the ministry will reallocate about EUR 1.5 million to strengthen the tourism industry in Latgale through various activities, including support for trips to various tourism fairs and specific conferences to attract organizers of tourism events.

"Of course, the amount could be even higher, but we have now found a way to save and reallocate EUR 1.5 million for this activity within the framework of our ministry," said Valainis.

He also said that the state must ensure the security of investments in Latgale. "We need to take care of a clear system of how investments are protected," the minister said.

According to Valainis, during the government's meeting in Latgale on June 27 this year, an algorithm is to be approved for compensating entrepreneurs and private individuals for losses caused by drones flying into Latvia from abroad. "There must be a clear answer from the state on how losses, if any, are fully compensated. This must be the case for both individuals and businesses," said the minister.

As reported, in late May this year, tourism service providers in Latgale pointed to a critical situation in the sector due to the arrival of drones and frequent cell phone announcements.

The Latgale Tourism Association (LTA) addressed an open letter to the highest state officials, ministries and the parliament, pointing out the critical situation in the sector. Tourism service providers pointed out that recent events in Latvia's eastern border region - repeated drone incidents, regular airspace alerts, cell broadcast alerts, the activation of NATO fighter jets and crisis communication dominating the public space - have had severe consequences for the Latgale tourism industry.

"These consequences are already catastrophic, as foreign tourists and tour operators are massively cancelling bookings, with the number of cancellations already reaching 60 percent," the LTA wrote, adding that corporate events and school excursions are also being cancelled.

The organization has also found that Latvians are choosing not to visit Latgale because of security fears, resulting in a dramatic drop in bookings for hotels, guesthouses, campsites, restaurants and tourist attractions just before the summer season. Bookings are down by 40 percent compared to the same period last year.

According to the LTA, these factors create the preconditions for the bankruptcy or closure of tourism and hospitality companies in the Latgale region and the dismissal of employees.