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Vol 2, No 22
5 June 2000
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Latvian News Review News from Latvia
All the important news
since 29 May 2000

Mel Huang

Politics and foreign affairs

Prime Minister Andris Bērziņš made his first trip as PM to Brussels, stressing the importance of Latvia's EU integration. He met with Enlargement Commissioner Günter Verheugen and CFSP chief Javier Solana and asked for more negotiations chapters to be opened with the EU.

After weeks of negative statements from Russia concerning Latvia, the EU finally stepped up to defend its future member. Portugal, which holds the rotating EU presidency, issued a statement calling the Russian approach "unacceptable" in a modern Europe. Latvia thanked Portugal profusely.

Deputy director of the state chancellery Tālivaldis Zamozdiks was sacked over improper spending. The State Audit Office also ruled that the chancellery should repay about LVL (Latvian Lats) 50,000 to the state budget for misuse of funds and should lose some LVL 70,000 in future funding for the construction of a controversial recreational facility in the chancellery building. The report cited one example of LVL 20,000 being spent on flowers over two years, though chancellery director Gunta Veismane defended the need for flowers due to protocol reasons.

Representatives of the regional parliamentary body, the Baltic Assembly, met in Tartu between 26 and 28 May to discuss closer co-operation between the three countries. The body adopted six resolutions during its sitting: co-operation in tourism, combating illicit trade, co-operation for sustainable development, co-operation on quality control for foodstuffs, combating illegal drugs and a statement of concern on the human rights situation in Belarus.

During the same time, the three foreign ministers met and signed an agreement on the exchange of confidential and classified information.

Also at the same time, Estonian Economics Minister Mihkel Pärnoja and Latvian Economics Minister Aigars Kalvītis signed a letter of intent for close co-operation between the two countries' power utilities: Eesti Energia and Latvenergo. Many analysts see this as the initial step towards a merger, which has infuriated Lithuanian officials. Pärnoja suggested that the ten per cent stake in Lietuvos Energija held by Sweden's Vattenfall kept Lithuania out of this preliminary round, but officials from both Estonia and Latvia stressed the need to involve Lithuania in closer energy co-operation and the proposed unified energy market.

However, plans to privatise Latvenergo have hit a roadblock, as a petition drive to call a referendum began this past week. Campaigners will have until 30 June to collect over 130,000 signatures for the issue to go to referendum. This is being funded by some left-leaning parties and trade unions. However, their efforts were bolstered by a poll by SKDS showing that 81.6 per cent of Latvian residents are opposed to the privatisation of their power utility.

Kazakh Foreign Minister Erlan Idrisov visited Latvia, after arriving from his trip to Estonia. In meetings with various officials, economic co-operation - especially the use of Latvian ports for Kazakh exports - was the featured topic.

Members of the radical right-wing organisation Perkonkrusts (Fire Cross) were found guilty of terrorism and sentenced this past week. Several members were either given suspended sentences or credited with time served, while two members are still serving additional jail time. They have been ordered to pay restitution for the damage they caused, including the bombing of a monument to Soviet soldiers.

Economics and business

Among the Baltic states, Estonia has the highest average monthly wage, if calculated using the US dollar at USD 284, up 11 per cent. This is followed by Lithuania, at USD 264.18 (up 2.4 per cent), and Latvia, at USD 241.10 (up 7.5 per cent). However, this is tempered by using the US dollar as the comparative figure, as the Lithuanian litas is pegged to the dollar and the Estonian kroon is pegged to the German mark - and we know what has happened in their respective exchange rates over the year.

Using the same US dollar scheme, Latvia has the highest monthly pension among the three countries, at USD 99.70 (up 4.2 per cent), followed by Estonia, at USD 97.90 (up 0.7 per cent), and Lithuania, at USD 78.08 (up 0.4 per cent). The same exchange rate situation applies here, obviously.

Finance Minister Gundars Bērziņš proposed for the 2001 budget a fiscal deficit of 1.05 per cent of GDP, or LVL 44 million. Expenditures will reach LVL 1.45 billion, while intake should reach only LVL 1.41 million.

Social and local interest

The Statistics Department announced that Latvia's population dropped by another 15,200 in 1999 alone. One piece of good news is that the birth rate grew for the first time since 1988, as 19,400 children were born in 1999. However, that is tempered by 18,000 abortions in the same year. Of all the children born, 39 per cent were born out of wedlock. Also worrisome is that the leading cause of unnatural death is suicide, which took the lives of 764 individuals (down by about nine per cent). There were also 6010 divorces, compared to 9400 marriages in 1999.

The Health Promotion Centre released a poll indicating that 27 per cent of boys and 12 per cent of girls smoke by the age of 15. The Centre said this is the highest rate in Europe, outside of Greenland.

The state secondary school maths exam was carried out finally this past week, after being delayed due to it being sold illegally on the internet. However, the rashness in preparing the new exam caused the Russian-language version to be more difficult due to poor translation, and officials at the Education Ministry pledged to take that into account for the results.

The traditional slate of public opinion results came from SKDS, which has President Vaira Vīķe-Freiberga on top again as the most popular politician, at +59.1, followed by central bank head Einars Repše, at +44.8. Embarrassingly, former Premier Andris Šķēle was most unpopular, at -46.6, which is even lower than Soviet-era boss Alfrēds Rubiks, at -45.8.

Looking at only government ministers, Defence Minister Ģirts Valdis Kristovskis topped the tables, at +43.5, followed by Culture Minister Karina Pētersone, at +43.4, and Prime Minister Andris Bērziņš, at +43.2. The vocal Finance Minister, Gundars Bērziņš, is rated most unpopular, at -20.8.

And finally, among political parties, Latvia's Way of the new prime minister and the opposition Social Democratic Workers Party matched up even, at 14 per cent, followed by For Fatherland and Freedom, at 11.5 per cent and the People's Party, at 10.9 per cent.

In the first four months of 2000, there have already been 8973 car accidents, which resulted in 162 fatalities. However, the number of accidents is down by 2.9 per cent from the same period in 1999. Of the total, 669 of them involved alcohol, down by 11.4 per cent. Despite that, the authorities said that LVL one million will be cut from the road maintenance fund for this summer.

And in other news...

Since its number three performance at the Eurovision song contest, Brainstorm has become the most talked-about group in Europe. European tours have been planned, a new version of their album is scheduled for release and British music guru Jonathan King (the man that discovered that little band in the late 1960s called Genesis) has been raving about "My Star," the band's Eurovision entry.

Exchange rates
As of 29 May 2000

currency Latvian lats (LVL)
1 US dollar 0.60
1 British pound 0.90
1 German mark 0.29
1 euro 0.56

[For continuous updates see the Bank of Latvia Exchange Rates page].

Mel Huang, 5 June 2000

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