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Latvia country profile

18 January 12 09:59 GMT

Not much more than a decade after it declared independence following the collapse of the USSR, Latvia was welcomed as an EU member in May 2004. The move came just weeks after it joined Nato. These developments would have been extremely hard to imagine in not-so-distant Soviet times.

For centuries Latvia was primarily an agricultural country, with seafaring, fishing and forestry as other important factors in its economy.

Latvia was under foreign dominion from the 13th until the 20th century. After the first world war it declared independence which Russia recognised in 1920.

Two decades later, following a pact between Stalin and Hitler, Soviet troops invaded in 1940 and Latvia was absorbed into the Soviet Union. Nazi forces pushed the Soviets back in 1941 but the Red Army returned in 1944 and remained for half a century.

During the Soviet period, which ended in 1991, Latvia underwent heavy industrialisation, and experienced a big influx of immigrants from other parts of the USSR, mainly Russia.

About a quarter of the population is Russian-speaking and the rights of this section of society have been a thorny issue since independence. Government reforms introduced in 2004 to restrict the use of the Russian language in schools remain controversial.

Legislation on citizenship was toughened up in 2006. Candidates who fail a Latvian language test three times will be denied citizenship. People without citizenship are entitled neither to vote nor to obtain an EU passport.

Like its Baltic neighbours, in the decade after independence Latvia made a rapid transformation to embrace the free market.

Latvia's economy grew by 50% between 2004 and 2007 but the global financial crisis of 2008-9 hit the country hard, and the former Baltic tiger endured one of the worst recessions in the EU.

The social turmoil triggered by the financial crisis led to the fall of the Godmanis government in February 2009. By January 2010, unemployment had soared to 20%, prompting fears of further political instability.

President: Andris Berzins

Andris Berzins was voted into office by parliament in June 2011 amid a controversy over corruption.

The outgoing president Valdis Zatlers lost his bid for a second term just days after he demanded a snap general election to root out corruption. He attacked the influence of three politicians who are also businessmen, calling them oligarchs.

The presidential vote exposed strains in the ruling coalition.

Berzins, a wealthy businessman and former head of one Latvia's biggest banks, won the backing of 53 lawmakers in the 100-seat parliament.

He was elected to parliament in 2010.

Prime minister: Valdis Dombrovskis

Valdis Dombrovskis became prime minister in March 2009 after the previous coalition government of Ivars Godmanis collapsed amid widespread discontent at its handling of the economic crisis.

Mr Dombrovskis' centre-right coalition was re-elected comfortably in elections in October 2010, regaining the parliamentary majority it had lost in March when the then largest party in his cabinet quit over a dispute about austerity measures.

A month after the elections, Mr Dombrovskis formed a government with the second-largest coalition partner, the Union of Farmers and Greens, to replace his initial five-party coalition.

However, the new government again proved shortlived, and was voted out of office in the September 2011 snap election called by the then president, Valdis Zatlers.

Mr Dombrovskis put together a new coalition between his Unity Party, the Zatlers Reform Party and the nationalist National Union bloc, excluding the pro-Russian centre-left Harmony Centre, which had emerged from the elections as the largest party.

During his first term in office, Mr Dombrovskis pushed through some of the toughest austerity measures in Europe in an effort to rescue the state from bankruptcy and prepare Latvia to join the euro by 2014.

The deep public spending cuts gave rise to widespread anger at home, but the government's policies impressed international lenders - especially the IMF and the EU, which in 2009 agreed a 7.5bn euro ($10bn) bailout for the country. Investors see Mr Dombrovskis as the main guarantor of the rescue loans agreed.

Born in 1971 and a physicist by training, he was an MP and finance minister in 2002-2004. From 2004 to 2009 he was a member of the European Parliament.

Latvia's TV market is dominated by the commercial LNT, two networks operated by the national public broadcaster, commercial TV3 Latvia and the Baltic variants of the main Russian networks. Public radio and TV are financed by state subsidies and advertising.

Around 140 newspaper titles reflect a variety of political views.

The media operate freely, with few legal restrictions. A law provides prison terms for libel and incitement of racial hatred.

However, there have been serious press freedom violations in recent years, according to Reporters Without Borders. It cited the murder of a media owner in April 2010, and said journalists have been stabbed or beaten in the past decade.

By mid-2010, around 1.5 million Latvians were online (Internetworldstats).

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