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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: 304 - (28/04/06)

President of Latvia: Putin an unwelcome guest at NATO Riga's summit
The Latvians are relishing their new-found Western credentials. They are looking forward to hosting NATO in November for the first time. It will be solid proof to every true Latvian that, despite having huge numbers of Russian 'Latvians' in their midst, they are at last free of the tutelage of the Kremlin.
President of Latvia Vaira Vike-Freiberga naturally told the press on March 29th that she did not want to see Russia among the guests of NATO Riga's summit in November 2006. Vike-Freiberga thinks that, otherwise, the number of issues would increase, so there would be no time for important domestic questions, a tactful way of putting it that this savvy lady is now a past master of - or should it be 'past mistress?'
The president thinks that the agenda must be formed in cooperation with non-governmental organisations (NGOs), certainly a good idea. The newspaper also cites the Head of the Presidential Committee for Strategic Analysis, Janeta Ozolini, who says that an invitation to Russia depends not on the Latvian president, but on relations between Moscow and NATO. Formally quite so.

Prime minister has received ultimatum from coalition partners
A domestic crisis has blown up, always a distinct possibility in the fraught world of Latvian coalition politics.
On April 3rd, Latvian Prime Minister Aigars Kalvitis (People's party) received an ultimatum from ex-Prime Minister and leader of New Era Party Einars Repse: to cooperate in the framework of the ruling coalition either with the New Era Party, or with the First Party, because the New Era people do not see further possibility of cooperation with the First Party cadres. 
Repse, the former highly successful governor of the central bank, is a dominant figure in Latvian politics who has a knack for putting people's backs up. His own premiership in the early 2000s foundered on his overweening arrogance towards his coalition colleagues. He now seems bent on the cessation of the current premiership of Kalvitis, unless massive changes are made. If the New Era Party leaves the Cabinet of Ministers, the current government of a right-wing majority would turn into a minority one. This is Repse's trump card.

Who is the more corrupt?
It should be recalled that, on March 15th, the premier requested the resignation of Communication Minister Ainars Shlesers (First Party), involved in a bribery scandal and subornation attempt during voting to elect the mayor of Jurmala. In its turn, the New Era party, whose representatives head the City Duma of Jurmala, having its biggest parliamentary fraction, have stated that it would not support the new candidature for the communication minister's post from "the First Party people," because it did not wish to work with the party, in its view "caught at political corruption."
Meanwhile, the First Party paid back the insult and requested the resignation of Economy Minister Krisjanis Karins (New Era Party), because of his disability in distributing EU structural funds. 

Latvian mass-media: ex-minister of economy distributed EU funds in favour of his party's sponsors
Indeed, on April 7th, Riga Neatkariga newspaper reported, citing the available analysis of distribution of EU funds in Latvia, that the said now ex-minister of economy, Krisjanis Karins (New Era Party), made several decisions, favourable for his party's sponsors. He hampered activities of other parties' representatives, if they participated in projects, while he was minister and was distributing the money of EU structural funds. 
It should be recollected that, on April 6th, the New Era Party proclaimed that it was leaving the Cabinet of Ministers, where it controlled six ministries, including the Economy Ministry. The decision was made after the economic police had brought criminal actions in connection with possible violations during submitting an application to the Economy Ministry, through which, S&G polygraphist firm - one of New Era's sponsors - succeeded in illegal receipt of European financing of more than 1 million lats. 
After bringing the matter before the court, New Era Party refused to work in the same coalition with the First Party, heading the Interior Ministry, and early on April 7th Prime Minister Aigars Kalvitis (People's Party) received letters of resignation of "New Time" ministers. The crunch is coming.

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BANKING

Parex banka could buy Russian bank in 2006 


Latvia's Parex banka could acquire a bank in Russia in 2006, Valery Kargin, CEO and co-owner of the lending organisation, said, New Europe reported.
"If everything goes as we like, then you will be able to receive the services of a Latvian bank in Moscow," he said. "Parex banka wants to find a bank in Russia with a professional team and experience in the credit sector, including providing loans to acquire transport," Kargin continued, adding: "The choice is not easy. There are a lot of banks in Russia and they cost a lot." Earlier on the same day a statement from the bank revealed that shareholders of Parex banka had approved a Eurobond issue. The five-year Eurobonds would likely be issued in the second quarter of 2006, Yevgeny Zolotarev, the bank's vice president for capital and investment markets, told reporters. "A presentation of the issue will take place in Europe and Asia," he said adding that the issue would likely be larger than in 2005. Deutsche Bank and HSBC were named as the organisers of the issue.

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CONSTRUCTION

Latvia construction volumes up 15.5% in 2005 

Construction volumes in Latvia reached 818.1 million lats (1.164 billion Euro) last year, a 15.5 per cent increase from 2004, according to a report by the Baltic News Service (BNS), citing the Latvian statistics bureau. 
New building projects rose 27.8 per cent or 86.4 million lats in 2005 in constant prices from 2004. Renovation and reconstruction works grew 5.8 per cent or 23.1 million lats. Construction works carried out by Latvian companies abroad declined last year to 6.3 million lats from 8.1 million lats in 2004. Most construction works outside Latvia were carried out in EU and CIS states.

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TELECOMMUNICATIONS

Izzi hopes to catch Baltcom 

Izzi, the internet and digital television service provider in Latvia, has increased its clients portfolio by purchasing its competitor, Fao, and Izzi does not hide the fact that its main target is to catch the current competitor, that is Baltcom. At present Fao is providing services to 20,000 subscribers in Riga and Riga district, Lielvarde plus Tukums. Now Izzi has 100,000 subscribers catching Baltcom with 130,000 subscribers, New Europe reported.

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