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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: 276- (01/01/04)

The Latvians are doing well, with growth of GDP of over 6% this year, coming after years of around 5% growth annually. There has been a lot of help from abroad, notably from Germany and Scandinavia, particularly Sweden.

Sweden to the rescue
The Swedes and Latvians are akin in spirit and share a Protestant faith, not just the Baltic Sea. The parenting pattern is repeated throughout the region, Lithuania having ties with Norway and Estonia with Finland.
The Swedes have set up a business school in Riga, which is training a new generation of managers in Western business practices. The Stockholm School of Economics is having a big impact. MBAs are flourishing and student numbers are rising. Never has it been a better time to be a young businessperson in Latvia, and many of the best students are women.
The phenomenon resembles the Marshall Plan after the Second World war in Germany and elsewhere, whose managers were trained in the US in their tens of thousands. This time it is on the spot, with Latvians from the Diaspora playing an important role, some from Sweden, others from the US and Canada.
The graduates are the new business elite. Notes Torger Reve, President of the Norwegian School of Management in Lithuania: "Integration of management education is the most important force in bringing the Baltics up to speed with their European Union neighbours."
The process is still in its early stages. There is great scope for catching up. But there is every reason to suppose that in a generation or two Latvia will become a prosperous Western nation.
The existence of highly educated personnel lower down the hierarchy also greatly helps. The combination of a still very cheap work force of a high quality and well-trained managers is attracting abundant foreign investment to Latvia. The auspices are excellent.

Latvia in Iraq
The Latvians have been doing some 'missionary work' themselves most recently, namely in Iraq. The Latvians were among those who generally supported the war in March. Their foreign minister, Sandra Kalniete, explained why in a recent article in the Wall Street Journal Europe, called 'Freedom cannot be taken for granted.'
"Latvia recently celebrated her 85th anniversary. Fifty of those years were spent living under Soviet and Nazi totalitarian regimes. Latvia lost its independence in 1940 because its proclaimed neutrality was not effective and Western countries were not able to take a common line against two evil empires. Our people suffered under the rule of totalitarianism. This is why Latvia decided to support coalition forces in Iraq."
She added: "This is why Latvia has sent more peacekeeping forces than anywhere ever before to Iraq. Latvia has committed itself to this process by sending its soldiers as part of the stabilization forces in Iraq and offering technical assistance, as well as sharing our transformation experience."

Latvia in the EU
Another woman at the top in Latvian politics is the president, Vaira Vike-Freiberga. She is keen to steer Latvia into the EU as soon and as smoothly as possible, not least to exclude forever the possibility of a return to totalitarianism. It is not that even the newly authoritarian Russia of Putin makes Latvians afraid of a new Russian invasion, but that one cannot be sure what Russia might be like in 30 or 50 years' time.
Latvia is in fact due to join in May next year. Vike-Freiberga met with President Roman Prodi of the European Commission (EC) in Brussels on October 10th. These types of meetings are usually the occasion for a bland exchange of platitudes. The leaders merely ratify decisions taken by hard-nosed officials out of the public eye. This was no exception.
But this itself was significant. Previously the EU has objected to Latvia's policy on citizenship, denying it in effect to the large Russian minority, which predominates in the six largest conurbations, including the capital. Riga. The requirement of fluency in Latvian has been too daunting for Russian Latvians of a certain age. The EC, however, supports Latvia's society integration policy, says the commission president, which is on the right track, he avers. 
Such is not the view of the Council of Europe; whose head on human rights, Alvaro Gil-Robles, told a Latvian parliamentary delegation recently that the naturalisation process in the country is too complicated. The language politics in the republic is aimed more at assimilation than integration, he said. "Even if someone were just thinking about assimilation, it would be a big mistake; it is more important to convince the society than it is to coerce them. Otherwise you could have problems in the future."
The problems are already present in Russia's view, which cancelled a planned meeting of the Latvian-Russian Intergovernmental Commission for October 27th. The commission has never met at the highest level since its formation in 1997. The Russians are taking revenge on Latvia by cutting their supplies to Ventspils, the oil terminal and port on the Baltic. Oil transhipment by pipeline has been halted and is only by rail from Russia. This has risen by 143% year-on-year, not enough to offset a 22.9% drop in total from 11.8 million tonnes in the first nine months of 2002 to 9.1 million tonnes in the same period of 2003.
Actually the problem of integrating the Russia minority is likely to disappear in the future, as young Russians take to learning Latvian at school as well as even marrying into the Latvian population. The future lies with harmony. 
This is for largely economic reasons. Latvia is doing well economically in a way that is not captured by statistics. Some 40% of economic activity is in the black economy, unreported by official statistics. Even on these the economy is vibrant, GDP growing by over 5% annually in this decade. Russian Latvians want to be part of the success story and members of the EU to boot.

Russia-Latvia relations hurt by spat
The relations between Russia and Latvia have not been helped by some recent comments by two Russian deputies, one of whom is regarded as an incendiary by all those cherishing Western values, namely Vladimir Zhirinovsky. He is the Deputy Speaker of the Duma and head of the Liberal Democratic Party of Russia, which is anything but liberal, and not notably democratic, in its ardent Russophile nationalist viewpoint. The thought of him ever coming to power in Moscow is certainly something to alarm the Latvians.
The Latvian Foreign Ministry recently expressed its protest at remarks made by Vladimir Zhirinovsky and chief of the State Duma's international relations committee, Dmitry Rogozin. The ministry has called these remarks "insulting, provocative and aimed at straining bilateral relations." In an interview with Latvian television recently, Zhirinovsky called the Latvians aboriginals and said that the Latvian president should be tried by The Hague court together with Former Yugoslav President, Slobodan Milosevic, who is charged with war crimes. 
Rogozin said that pro-Nazi forces have come to power in Latvia and called Latvia a country of thugs in commenting on the opening of a cemetery where Latvian citizens who fought alongside Nazi troops during Word War II are buried; and about a five-year prison sentence issued to former Soviet special services officer Nikolay Larionov. Foreign Ministry State Secretary, Maris Riekstins, told the Russian Ambassador at Riga, Igor Studennikov, that these remarks regarding the country's democratically elected parliament and government and other high-ranking officials are insulting. "These statements are seen as an inappropriate response of this neighbouring country's officials to Latvia's commitment to advancing bilateral relations in the interests of the two countries' citizens'" Riekstins added. Much of this reflects the troubled handling, a year or two go, of Latvian veterans of the Waffen SS marching in uniform with Swastika flags flying, to commemorate their fallen colleagues. Unsurprisingly, there was a massive row at the time, the head of the Latvian armed forces, who had attended this march in his military uniform, was required to resign shortly afterwards. The insensitivity of this previous administration has to some extent washed over their successors.

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CONSTRUCTION

Experts propose closing Daugava Embankment to traffic


International architects' proposals for the development of the Daugava Embankment in Riga include closing the Daugava embankment for traffic and transforming the Akmens (Stone) Bridge into a pedestrian mall that would include stores, cafes and libraries, LETA News Agency quoted Dana Hasana, head of the public relations office of the Riga City Council's City Development Department, as saying recently.
The city council has selected the five best Daugava Embankment development projects submitted by international architects, the projects deal with the development of the Daugava Embankment from its intersection with Hanzas Street to the intersection with Turgeneva Street.
Awarded were Finnish and Danish architects who had submitted the best projects, French and Italian architects teams were the runners up and the German architecture students ended up third.
The Danish architects propose shunting traffic from the Daugava Embankment by constructing a groove in the Daugava embankment's side that would be used by traffic. The Finnish architects propose development of a new beltway to ease the problem of heavy traffic in downtown Riga, and new parks in the area. Projects submitted by French and Italian architects were praised for innovation - the French architects proposed developing downtown Riga into a recreation zone, whereas the Italian team offered to close traffic on the Akmens Bridge and transform the bridge into a pedestrian mall. The German team proposed developing the embankment into a three-level complex.
The City Development Department's Director, Vilnis Stams, said, in commenting on the architects' projects, that the first step to ease traffic congestion in downtown Riga would be closing traffic on the embankment on some specific days in summer, the embankment later, perhaps, to become a pedestrian mall.
The Danish architects' proposal to construct a groove in the Daugava Embankment's side for traffic is original and worth city authorities attention, Strams said.
Most projects submitted by the architects stipulate that Zemkgale Bridge should be constructed for easing traffic, while Akmens Bridge should become a pedestrian mall, only open to public transportation vehicles. 

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DEFENCE INDUSTRY

Latvia accepts Lockheed Martin radar

The Latvian Ministry of Defence recently took formal possession of a Lockheed Martin long-range radar system, the first air surveillance system in the country, the company based in Bethesda, Maryland, said in press release recently.
The TPS-117 radar system, contracted for US$13m in 2001, will expand the range of BALTNET, the join air surveillance network that monitors the airspace over and around the Baltic States of Estonia, Lithuania and Latvia. Under a separate contract, Lockheed Martin provided a TPS-117 radar system in April to Estonia. 
The radars provide the Baltic States with air surveillance capabilities that support their entry into NATO, consistent with the invitation extended in 2002. "This TPS-117 fills an important space in BALTNET and gives Latvia the air surveillance capability that every country needs in today's global security environment," Greg Larioni, Lockheed Martin's director for ground-based radar, said in a press release. 
The TPS-117 is designed for transportability and frequent re-deployment. Upon arrival at site, an eight-person team can set up and begin operating the system in about 60 minutes. The antenna and electronics shelter can be transported on two trucks, or in two C-130 aircraft. The TPS-117 shares 90 per cent commonality with the larger AN/FPS-117, which is deployed in 20 countries, making it the most widely used long-range radar system in the world. 

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FOREIGN ECONOMIC RELATIONS

Repse hopes for partnership with Russia after EU entry

During a meeting with Austrian Chancellor Wolfgang Schussel in Vienna recently, Latvian Prime Minister, Einars Repse, confirmed Latvia's desire for the European Union's partnership and cooperation treaty with Russia to apply to all future EU members following their entry into the Union.
Interfax News Agency quoted the Latvian government's press service as saying that the two men also discussed Latvian-Russian treaties on the border and border control. Repse expressed gratitude to Schussel for Austria's support for the Baltic nations' EU integration bid and invited him to visit Riga next spring.

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