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LATVIA


 

 

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)

Books on Latvia

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: 308 - (29/08/06)

The Queen to go to the Baltic States this autumn
Queen Elizabeth II is to visit the Baltic states of Latvia, Lithuania and Estonia from October 17 to 20, Buckingham Palace confirmed on August 4. 
This is a more important event than at first sight might appear. The British monarchy has an enormous reputation as the repository of aeons of history. It symbolizes British constitutional governance, the mother of parliaments and the Western world no less.
The visit, which has already been widely discussed by the Baltic media, is seen locally as a compliment to the three states and a recognition of their achievements. This is certainly true of Latvia.
'Latvian foreign policy experts agree that the queen's visit shows Britain's growing interest in our state... This is a special gesture, because Prince Charles has already visited us twice,' Latvian daily Diena commented when the visit was first announced. 
The queen has no say in the shaping of British foreign policy, but her visits can generate diplomatic goodwill. The UK and the Baltics share a range of strategic interests within the EU - interests generally characterised as liberal and pro-American. 
'This first visit by a British monarch to Latvia will celebrate the excellent bilateral relations, past and present, between our states, and our current cooperation in the EU and NATO,' said Judith Gardiner, deputy head of the British Embassy in Riga, according to Baltic News Service BNS. 
Concern will now focus on maintaining security at the event. The last time the Queen's son and heir, Prince Charles, visited the Baltics, a young Latvian Bolshevik slapped him with a carnation - an embarrassment all sides will be keen to avoid repeating. 
The Queen is scheduled to visit Lithuania on October 17-18, Latvia on October 18-19, and Estonia on October 19-20, palace sources confirmed.

Georgia's Prime Minister to pay his first official visit to Latvia
A more immediately pressing matter is that Georgia's Prime Minister Zurab Noghaideli is scheduled to make his first official visit to Latvia this September, the Latvian governmental press service said. 
The aim of the PM's visit is to strengthen the political dialogue between the two countries, get familiar with the experience of Latvia as the EU and NATO member, and discuss possible assistance to Georgia in its efforts to integrate in Europe and NATO. 
According to Peteris Ustubs, foreign relations advisor to Latvian Prime Minister Aigars Kalvitis, regarding Georgia, Latvia's priority is the country's successful integration in the EU with an aim to foster the bloc's development.
Ustubs also indicated that the EU's new neighbourhood initiative envisaging "cooperation with other countries is an essential part of the further integration of states." 
During the visit, Georgian officials and representatives of business delegations are planning to establish and expand mutually advantageous business, tourism and cultural contacts.

Jaundzeikars to remain interior minister
Prime Minister Aigars Kalvitis announced on July 31 that he would not demand the resignation of Interior Minister Dzintars Jaundzeikars for the police's failure to prevent clashes during the gay pride festival on July 22.
"There are two months left until the parliamentary election, therefore I think that the resignation of the interior minister should not be demanded," Kalvitis said.

Kalvitis blames Repse, Gulbis for state financial losses
The imminence of elections is leading to a spate of mud-slinging between the country's leading politicians.
Kalvitis in early August said that the officials responsible for losses incurred during the construction of Latvia's eastern border, who happen to be his main rivals, should receive adequate punishment.
An investment project for building the infrastructure of Latvia's eastern border was launched in 1997. The goal of the project was to set up a safe, well-equipped outer border of Latvia and the European Union. In the period between 1997 and January this year, 36.74 million lats (52.27 million euros) were spent on the project.
In 2003, the Latvian government terminated contracts with several construction companies involved in the project, taking into account state audit results and the lack of funding. The interruption of construction work incurred a loss of 4.176 million lats to the state. Construction resumed a year ago.
In an interview with Latvia's LNT commercial television, the prime minister blamed former government officials - former Prime Minister Einars Repse and Maris Gulbis - for suspending construction on the state border. The reason behind the move, Kalvitis added, was merely to raise their popularity ratings. "We can see that populism costs us dearly. Populists must assume responsibility, in this case for millions of lats," Kalvitis said.
He emphasized that the situation must be assessed by the Prosecutor's Office, otherwise it will be difficult for him, as prime minister, to bear responsibility. "There are specific losses, and somebody has to assume responsibility," Kalvitis said. The Latvian government asked the Prosecutor's Office on July 11 to assess the losses incurred during the postponed construction work.

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AVIATION

East-West strategy pays off for AirBaltic 


Latvian national airline AirBaltic unveiled strong growth figures for the first half of 2006 recently, strengthening its position as a growing player in East-West air transit, New Europe reported. 
AirBaltic recorded a 44 per cent increase in passenger numbers, a seven-per cent rise in cabin occupancy and a 74 per cent gain in operating income compared with the first half of 2005. The airline closed the half with a profit of 984,000 lats (US$1.8 million). "Despite growing competition and rising costs, we have managed to both maintain growth and improve our results in all aspects of business," said the airline's president, Bertolt Flick. The figures were seen in Latvia as a vindication of the airline's strategy. AirBaltic's aim is to position itself as a key player in transit between northern Europe and the former Soviet Union. Since Latvia joined the EU and its "Open Skies" area in May 2004, the airline has opened a second hub in the Lithuanian capital, Vilnius, doubled the size of its fleet, and seen passenger numbers rise from half a million to an expected 1.5 million this year. It has also expanded its traditionally western-oriented network with flights to a series of CIS destinations such as Baku, Tbilisi, Odessa, Dnepropetrovsk and Kaliningrad. 
"The demand for such exotic destinations as Tbilisi, Baku and Bergen is stronger now than demand for destinations like Vienna and Moscow was in 2003. This shows how much the industry has changed in Latvia," Flick commented. The figures come at a time when competition in Latvian aviation is increasing dramatically. A string of low-cost airlines, including Easyjet and Norwegian, have opened flights to Riga, and Ryanair is rumoured to be planning to open a hub there. 
AirBaltic, which introduced one-way ticketing in 2003, has been forced to slash prices on key routes. Tickets for under US$10 one way are already available on flights to Bergen, Hamburg, Helsinki and Oslo, and the plan is to expand this low-cost model. 
"Step by step, we are coming closer to a time when similar (low-cost) ticket starting prices will be introduced on all AirBaltic flights," Flick commented. The airline's decision to strengthen its eastern presence is a further reaction to increased competition within the EU. Riga is one of the Union's easternmost airports, and Latvia, as a former Soviet republic, is a known brand in the CIS. 
"We will certainly see more flights to more eastern cities more often. In Soviet times two million passengers a year left Latvia for the East: we may not return to that level, but there will be more than we have now," Flick said.

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ENERGY

Interest grows in Ventspils Nafta oil-transit company 

International interest in the privatisation of Latvia's key oil-transit company is growing, with Polish, Kazak and Russian firms all keen, Latvian sources confirmed recently, Deutsche Presse-Agentur (dpa) reported. 
"Economics Minister, Aigars Stokenbergs, met representatives of Polish refiner PKN Orlen to discuss the sale of the state's stake in Latvian oil company Ventspils Nafta on August 7th," Stokenbergs' advisor Oskars Balodis said. "Kazak state company KazMunayGaz expressed interest in July, when President Nursultan Nazarbayev visited Latvia," he added. Ventspils Nafta manages two pipelines carrying oil and oil products from Russia to the Latvian port of Ventspils, together with the port's oil terminal. The Latvian state owns a 38.6 per cent share in the company. The state has now decided to auction off its stake some time in the autumn. The exact date and procedure have not yet been agreed, with the parties still discussing whether to auction the state's share in a single package or to allow it to be split. 
Stokenbergs met with financial consultants and the chairman of Ventspils Nafta to discuss the procedure for the auction, Balodis confirmed. No decision was reached, according to the LETA news agency. 
Apart from Orlen and KazMunaiGaz, Russia's Rosneft and an Austrian consortium represented by Citibank are also interested, Leta reported. Ventspils is one of the most important oil terminals in the eastern Baltic, with direct pipeline links to Russia. 
Whatever the terms of the auction, bidding is likely to be fierce. Both Orlen and KazMunaiGaz hope to strengthen their presence in the Baltics, with the Poles beating the Kazaks to secure the purchase of Lithuanian refinery Mazeikiu Nafta in May. KazMunayGaz subsequently closed its Lithuanian office and focused on boosting transit through Latvia - a goal reinforced by the Kazak president's first state visit to the country. Orlen, which has no production facilities of its own, is keen to diversify its supplies of crude oil. However, it recently suffered a setback when the pipeline feeding Mazeikiu Nafta was closed due to technical problems. One of the two pipelines run by Ventspils Nafta is also closed, following a dispute with Russian suppliers in 2003. Both sides have expressed their willingness to reopen the line, but no agreement has yet been reached.

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TRANSPORTATION

Latvijas Dzelzcels freight transportation down

On July 11th, it was reported by the website www.railway-market.pl that 25.395 million tonnes of freight was transported by Latvijas Dzelzcels (Latvian railways) in the first half of 2006 (-6.9 per cent year-on-year). 20.47 million tonnes of import cargoe (-9.2 per cent year-on-year) was transported including 18.04 million tonnes of cargoe, transported via Latvian ports and 2.974 million tonnes of transit land cargoe. Another 978,000 tonnes of export cargoe was transported including 622,000 tonnes of cargoe, which followed via the ports (50.5 per cent year-on-year). Also, 9.606 million tonnes of oil products (-13 per cent), 2.324 million tonnes (-38.5 per cent year-on-year) was carried by the railway. And 4.197 million tonnes of cargo was transported by Latvijas Dzelzcels in June 2006 (-2.2 per cent year-on-year).

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