Latvia country brief

Introduction

Latvia, one of the three Baltic States, covers an area of 64,589 square kilometres. Latvia's population in 2016 was two million. The population has declined since 2000, as a result of emigration, primarily to other EU member states, an ageing population and a falling birth rate. The capital of Latvia is Riga. Latvia celebrates its national day on 18 November (Independence Day), and will mark its centenary in 2018.

Political overview

System of Government

Latvia regained its independence from the Soviet Union in August 1991. Under the Constitution, the President is elected by members of the unicameral Parliament (Saeima) for a four-year term and has limited powers. The President appoints the Prime Minister, approves the Cabinet and may return legislation to the Saeima. The Saeima has 100 members, who are elected. National elections for the Saeima are held on the first Saturday in October every four years.

Political Developments

Latvia’s President Raimonds Vējonis was elected in July 2015 for a four-year term. He is a member of the Green Party, part of the Union of Greens and Farmers. Vējonis served as Minister of Defence of Latvia in 2014 and held that office until becoming President in 2015.

National elections for the Saeima (Parliament) were last held on 4 October 2014. Latvia’s ruling centre-right coalition was returned with a clear majority and Mrs Laimdota Straujuma (Unity Party) was sworn in as Latvia’s first female Prime Minister. However, in December 2015, Prime Minister Straujuma resigned from the position and her government was dissolved. A new Latvian government was approved by the Latvian Parliament on 11 February 2016. The Unity political party, National Alliance and the Union of Greens and Farmers reformed as the new centre-right coalition government. The new coalition government is headed by a Prime Minister Māris Kučinskis.

Foreign Policy

Latvia joined NATO in 2004 and currently hosts a multinational force of 1,200 NATO troops. It has committed to reaching expenditure of two percent of GDP on defence by 2018.

Latvia joined the EU on 1 May 2004 and was accepted into the Eurozone on 1 January 2014. Latvia joined the World Trade Organization in 2009 and the Organization for Economic Co-operation and Development (OECD) in July 2016.

Economic overview

Agriculture and petrochemicals remain the cornerstone of  Latvia’s economy, though it continues to diversify, expanding its textile, manufacturing, food processing, logistics and green technology sectors. GDP growth in 2016 was two per cent, down on a post-financial crisis high of four per cent in 2012. An improvement in economic performance was expected in 2017 due to a stronger growth in the Eurozone.

Bilateral relationship

Australia recognised Latvia's regaining of independence on 27 August 1991. Latvia and Australia enjoy friendly, co-operative relations with strong people-to-people links as a result of the large numbers of Latvians who migrated to Australia, particularly in the aftermath of World War II. At the time of the 2016 Census, there were 20,514 people in Australia of Latvian ancestry.

The Australian Ambassador in Stockholm is accredited to Latvia. The Latvian Ambassador in Tokyo has non-resident accreditation to Australia. Latvia is represented in Australia by Honorary Consuls in New South Wales, Victoria, Queensland, South Australia and Western Australia.

The relationship between Australia and Latvia is underpinned by bilateral agreements covering Trade and Economic Cooperation (1993), Extradition (2005) and Social Security (2011).

High-level visits

The Foreign Minister of Latvia, Mr Edgars Rinkēvičs, visited Australia in June 2015. The Australian Prime Minister's Special Envoy, Dr Russell Trood, visited Riga in September 2011, during which he signed the bilateral Social Security Agreement.

Bilateral economic and trade relationship

Two-way merchandise trade in 2016 between Australia and Latvia was $25.8 million. Australia exported $7.8 million worth of goods to Latvia during this period, primarily alcoholic beverages and civil engineering equipment and parts. Imports from Latvia in this period totaled $18 million, primarily telecom equipment and parts; furniture, mattresses and cushions; and alcoholic beverages.

Please contact Austrade for information on doing business in Latvia.

Last updated: September 2017



Last Updated: 20 October 2017