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LATVIA


 

 

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Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 9,671 8,406 7,500 94
         
GNI per capita
 US $ 4,070 3,480 3,230 79
Ranking is given out of 208 nations - (data from the World Bank)

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REPUBLICAN REFERENCE

Area (sq.km) 
64,589

Population
2,306,306

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

Capital 
Riga

Currency 
Lats

President
Mrs Vaira 
Vike-Freiberga




Update No: 296 - (26/08/05)

Latvian President advocates EU change
The Latvian president, Vaira Vike-Freiberga, has underscored that the EU was currently facing a crisis, and that aims to become the most dynamically growing economy in the world were falling short. Reforms in many EU member states have been formally implemented, she noted, and the results are not satisfactory. 
An increasing contribution to research, education and technology is necessary to raise the bloc's international competitiveness, she said, pointing out that citizens are becoming increasingly dissatisfied with the slow economic growth, unemployment and other woes. 
"Each crisis has two alternative interpretations. One is a 'threat' and the other one - 'opportunity.' In my opinion, we need a debate on what the EU actually is, and what it stands for, in order to go forward and turn crisis into opportunity," Vike-Freiberga said. 

Radical nationalism might be artificial
President Vike-Freiberga said in a recent interview that the recent wave of anti-Semitic comments or assaults on non-Latvians could have been kindled artificially. 
"There are especially humane people like missionaries and there is the other extreme -- people, who keep looking for an external enemy all their lives and boost their psychologically damaged self-confidence by making hateful comments on others. The number of such people in Latvia is not larger than in any other country," she told the Neatkariga daily paper. 
"According to the conspiracy theory, I start feeling that how come that all those incidents occur with clocklike regularity, so may be there are provoked artificially. But this is difficult to prove as there is no specific evidence," said the Latvian president. 
"Everybody knows that there are good Latvians and bad Latvians, just like there are good Russians and bad Russians," she said. 

Latvia budget vote triggers fresh coalition crisis 
Latvia's shaky ruling coalition has been plunged into a fresh crisis after a key government party threatened on July 21 to vote down the budget.
The New Era political party, which is the largest in parliament, said if their budget priorities were not met, then it would vote against the budget. In Latvia, such a no vote constitutes a vote of no confidence in the government. 
A date for a vote on the budget, which has been drawn up to try to balance out the competing interests of the four coalition partners, has not been agreed to. 
Instability has been a hallmark of coalition governments in Latvia since it emerged from Soviet rule in 1991. The nation, which joined the European Union in May last year, has had 12 governments in the last 15 years. Last year a minority coalition crumbled after it failed to pass a budget. The current four-party coalition is the third since 2002 has been wracked by internal tensions since Aigars Kalvitis was sworn in as prime minister just over six months ago. 
Kalvitis, who is member of New Era's rival People's party, called on New Era to think of the state's priorities not only those of their party's. But New Era said if its demands in the key policy areas of health, education, and justice were not met then it would move to vote the budget down. "If in the government or in parliament a budget is put forward that does not contain an increase in financing for science, as is foreseen in the law for scientific work, and teachers or doctors salaries, then New Era will vote against that budget," faction head Karlis Sadurskis said recently. The party also took issue with another coalition member, the religious party Latvia's First, and its push to use state funds to repair churches across the country, in a so-called "sacred tourism" scheme. 
New Era, a party that emerged only three years ago to contest the 2002 elections on a reform platform, is a bitter rival of the People's party. The two parties are the largest in parliament and decided to work together only after two previous governments failed. 
The battle of the budget is the latest in a long-running round of tensions between the government's coalition members. Aside from the budget, New Era has also challenged the Latvia's First party's candidate for the state's top human rights job. At the same time, New Era and the religious party have locked in a fight over the state's telephone monopoly. 

Latvia to drive Baltic growth 
Latvia will be the fastest growing economy in the Baltic states in the coming years, although inflation will be higher than neighbouring Lithuania and Estonia, the Baltic News Service reported recently, citing the Baltic macroeconomic review, which is prepared by SEB banks in the region. SEB analysts said the Latvian economy had adapted well to being in the European Union and was still leading by GDP growth.
GDP growth is expected at 7.5 per cent this year and 7 per cent in 2006. Lithuanian GDP growth is estimated at 6.8 per cent in 2005 and at 6.5 per cent in 2006 while the forecast for Estonia is a 6.4 per cent growth both this and next year.

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ENERGY

Finns to purchase Latvian gas 


Finland is planning to start importing natural gas from Latvia via a pipeline under the Baltic Sea from Estonia, The St. Petersburg Times reported. 
The pipeline could be in place by 2010. The seabed pipeline, at an estimated cost of 80 million Euro (US$95m), would run from Estonia, some 50 miles south of Finland across the Gulf of Finland. The natural gas would be transmitted to Estonia from Latvia along an existing gas network. The new pipeline would help meet growing demand for the clean energy source, especially in the Helsinki region, according to Antero Jannes, chief executive of Gasum, a natural gas company that is 25 per cent government owned.

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TELECOMMUNICATIONS

TeliaSonera eyes Lattelekom, LMT 

Latvian Prime Minister, Aigars Kalvitis, announced that Nordic group TeliaSonera AB has submitted an offer to buy the Latvian government's 51 per cent stake in fixed line company Lattelekom and mobile operator LMT, Baltic News Service reported recently.
TeliaSonera holds 49 per cent of Lattelekom and 49 per cent of LMT, which in turn is 23 per cent controlled by Lattelekom. 
TeliaSonera's Baltic spokesman, Kjell Lindstroem, said: "It would be optimal for our company to acquire 100 per cent of shares in Lattelekom and LMT, and it is no secret that TeliaSonera has always been interested in acquiring those shares." Lindstroem declined to say how much TeliaSonera had offered, and said details will only be released once the government has reviewed the offer.

Latvia Mobile, Nokia team up 

Latvijas Mobilais Telefons (Latvia Mobile Telephone, LMT) has signed an agreement with Nokia whereby the latter will supply and deploy WCDMA 3G network equipment to develop LMT's mobile network, New Europe reported.
This deployment will be the first commercial WCDMA 3G network in Latvia, as well as the first in the Baltic states. The initial service has been launched, paving the way for LMT to offer commercial 3G services such as video call and video sharing. Nokia's system is currently providing 3G coverage for the Latvian capital Riga and will to be expanded to suburban areas and beyond beginning in 2006. Nokia is a world leader in mobile communications. Nokia provides equipment, solutions and services for network operators and corporations.

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