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latvia

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LATVIA


 

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 8,406 7,500 7,200 93
         
GNI per capita
 US $ 3,480 3,230 2,920 86
Ranking is given out of 208 nations - (data from the World Bank)

REPUBLICAN REFERENCE

Area (sq.km) 
64,589

Population
2,385,231

Principal 
ethnic groups 
Latvians 52.0%
Russians 34%
Belarusians 4.5%

Capital 
Riga

Currency 
Lats

President
Mrs Vaira 
Vike-Freiberga

  

Background:
After a brief period of independence between the two World Wars, Latvia was annexed by the USSR in 1940. It reestablished its independence in 1991 following the breakup of the Soviet Union. Although the last Russian troops left in 1994, the status of the Russian minority (some 30% of the population) remains of concern to Moscow. Latvia continues to revamp its economy for eventual integration into various Western European political and economic institutions.

Update No: 274- (27/10/03)

The EU referendum won
The Latvians made their historic decision in favour of the EU in a referendum on September 20th, with a decisive victory for adhesion. The Latvian Socialist Party were advising people to reject EU membership and earlier in the summer opinion polls showed a majority against.
The Estonians voted in favour on September 14th by about 67% to 33%. It must have been a factor in ensuring that the Latvian result was about the same The Latvians were the last of the new entrants to hold a referendum on the subject. All the others voted in favour. They cannot have wanted the last also to be the losers.
The Latvians were being asked whether they wanted to become Westerners or remain in the shadow of Russia. Not surprisingly they chose the former. As one wit put it, the deputy leader of the parliamentary EU committee, Oskars Kastens: "I will drink champagne if it's a yes, and vodka if it's a no."

EU anthem and emblems to be partially adopted 
The Latvians are not being asked to shed their identity. After Latvia becomes a member of the EU, it will continue using its symbols of statehood - the national flag and anthem Dievs, Sveti Latviju (God Bless Latvia).
It is far from being legally obligatory to hoist the EU flag alongside the Latvian one. The performance of the EU anthem, 'Ode to Joy,' is also on any occasion at the discretion of EU member states.

Pro-EU vote already putting Latvia on the map
The adhesion of new members to the EU is already attracting attention around the world. The 'pro' vote in Latvia has given it a new interest and allure.
The King of Morocco, Mohammed VI, has expressed an interest in visiting Latvia to President Vaira Vike-Freiberga to enhance mutual relations. She is already scheduled to pay a visit to Morocco next year.
The president also met with the Prime Minister of Sri Lanka, Ranil Wickremesinghe, who had said he wanted to meet with Vike-Freiberga to discuss developing a closer cooperation between Sri Lanka and Latvia as a future EU member state. Vike-Freiberga informed Wickremesinghe about bilateral economic cooperation prospects, stressing opportunities offered by Latvia. Wickremesinghe expressed interest in Latvia's experience of implementing reforms. He also said diplomatic relations and business contacts between both countries should be made active. 
Vike-Freiberga said she highly appreciated Sri Lanka's resoluteness in solving a conflict in the state through a dialogue, referring to talks the Sri Lankan government is holding with rebel Tamils. Wickremesinghe has a high opinion of education as possibilities offered to foreign students in Latvia. Both officials also agreed that cultural ties should be promoted to increase mutual understanding between the nations.
The new allure of Latvia needs to be illuminated in terms of its history and current predicament.

Return to Western origins 
The country was really founded as Livonia in 1290 by the Livonian Order of Teutonic Knights. This gave it a Western direction, confirmed at the Reformation, which came early on in 1524-34 when the knights abandoned allegiance to Rome.
Livonia fell under Polish, Swedish and finally Russian rule for centuries, but never lost its fierce nationalism. The brief spell of independence between the wars only made this stronger.
The opening to the West of 1991 can now be ratified anew. 2004 is to be the year. Both the EU and NATO happen then.

Relations with Russia strained
The premier of Latvia is one of the more remarkable leaders in the former communist world. He is the former head of the central bank, much respected for curbing inflation in the 1990s. 
He is convinced that the adhesion to the EU and NATO will help relations to be put on a definitively new basis with Russia. Border treaties need to be signed. Cooperation is being extended against terrorism. A new deal dawns, he hopes.
But there is one massive dispute going on between Riga And Moscow. That is over oil deliveries to Ventspils, the main oil port on the Baltic, which account for $1,200m a year normally, with transit fees bringing in $200m to Latvia.
These are on hold due to a Russian embargo designed to get the transit tariffs down. Actually another reason is for a Russian company to acquire Ventspils Nafta, which controls the port. The embargo has successfully deterred American companies from bidding for the company in a coming sale of the state's 43% stake. 
Transneft, the Russian transport company, almost certainly behind the embargo, will probably take it over. The Russian oil-producing companies themselves have been against it, Yukos telling the government that it cuts revenues to the treasury in taxes. But Yukos is not so influential these days in the government circles.
Russia is clearly indicating its intention to consolidate its hold on key positions in the energy sector of the Baltic states ahead of their adhesion to the EU. Gazprom has 34% of Latvijas Gaze (Latvia) and 37% of d'Eesti Gaas (Estonia). As for Lithuania Yukos owns 53% of the leading oil complex, Mazeikui Nafta. These manoeuvres are unfolding when Russia is manifesting its desire to consolidate its position as the main supplier of energy to the EU.

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ENERGY

Ventspils Nafta sees oil transhipment volume down

Latvian oil terminal, Ventspils Nafta, transhipped 9.1 million tonnes of oil and oil products in the first nine months of 2003, down 22.9 per cent from 11.8 million tonnes in the same period in 2002, Interfax News Agency quoted company press secretary, Gundega Varpa, as saying in early October.
She said that in the reporting period that the terminal received oil only by rail, while last year oil was supplied to the port mainly by pipeline. Consequently, the volume of oil transported to the port by rail increased 143 per cent year-on-year.
Varpa explained that this increase was due to Ventspils Nafta activity in attracting Russian oil and oil products by rail. This year Ventspils Nafta has transhipped 300,000 tonnes of oil per month on average, received by rail only.
The terminal transhipped 4.8 million tonnes of diesel in the first nine months of 2003, in addition to 2.6 million tonnes of oil, 1.7 million tonnes of other oil products, particularly various types of gasoline. Varpa noted that compared with the same period in 2002 diesel transhipment volumes were up 74.6 per cent and 70.4 per cent for other oil products.
In September Ventspils Nafta transhipped 700,000 tonnes of oil and oil products, the same amount as in August, including 300,00 tonnes of oil and 100,000 of other oil products. The September results were influenced by ongoing harvest work and preparation for the winter heating season in Russia and Belarus, Varpa noted. She said earlier that freight volumes at Ventspils Nafta are traditionally lower in these months, due to season fluctuations.
Varpa also stressed that a 12 per cent increase, set by the Russian Transport Ministry from September 15th, in tariffs for the export of oil and oil products in privately owned tank cars to border points has increased exports' costs. It is assumed that this will influence freight volumes in subsequent months.
From October 1st 2003, transhipment of oil and oil products is handled by the terminal itself and its subsidiary OOO Ventspils Nafta Terminals, the largest Ventspils Nafta Terminals. The largest Ventspils Nafta shareholders are the state and AO Latvijas Naftas Transzits.

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