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Vol 3, No 5
5 February 2001
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News from Latvia News from Latvia
All the important news
since 26 January 2001

Daria Kulagina


Showing interest

The Latvian Privatization Agency said several potential bidders submitted statements of interest in a 68 percent stake in Latvijas kuģniecība (Latvian Shipping Company, LASCO) by the 1 February deadline. This tender is the fourth attempt to sell the controlling stake in the firm, after previous attempts failed due to lack of interest and political bickering.

Foreign Minister Indulis Bērziņš said that the slow pace of Latvian privatisation and political mudslinging over the selloff of LASCO are hurting the country's clout abroad. Economics Minister Aigars Kalvītis suggested that the participation of international advisers and surveillance from local NGOs would secure stability in the process, however.

It is expected that the 136 million state-held shares will be bought and paid for by June. The Cabinet is expected to approve the initial list of potential bidders on 13 February, and the final auction is expected to take place in May. LASCO, the world's 19th largest shipping firm, in tonnage terms, hopes for a 2001 net profit of USD 5.6 million on a planned turnover of USD 164.4 million (see this week's Amber Coast by Mel Huang for more on this story).

One of the most controversial figures in the ongoing privatization saga, Eižens Cepurnieks (For Fatherland and Freedom), a state proxy at LASCO, had to explain statements about alleged bribery in the privatization process he made to an anti-corruption NGO. During the meeting of his party's board, Cepurnieks denied that he had named officials who have allegedly been involved in bribery. He promised to confirm his statement to the Prosecutor General's Office in the near future. Cepurnieks resigned from the position of state proxy at LASCO one day after his meeting with the party's leadership.


New cardinals

In a surprising postscript to the record 37 new cardinals appointed two weeks ago, Pope John Paul II announced seven more—three of them in post-Soviet countries, including the Archbishop of Riga, Jānis Pujāts. The pope cited the suffering of Roman Catholics under Communist oppression as a motive for elevating three of their leaders. "Those selections also reflected this pope's desire to defend Catholicism in areas where it was once persecuted by the Soviet system and is now deeply resented by Eastern Orthodox churches, which often treat it as more of an enemy than a sister church," wrote The New York Times.

Jānis Pujāts and Marian Jaworski, 74, the Polish-born Roman Catholic archbishop in Lviv, Ukraine, were actually made cardinals in 1998, but their names were kept secret, or "in pectore" (within the breast), a practice used for prelates who serve in regions where their elevation to cardinal could prove harmful. While he said he had "various reasons" for not including the new names in last Sunday's announcement, he did not divulge them. John Paul II has increased the number of voting cardinals well above the limit of 120 set by Pope Paul VI in 1975, raising it from 128 to 135 with last week's appointments.

That, three years ago, the pope felt it prudent to keep their elevations a secret—something he had done before only for bishops working in Communist China and Soviet-ruled Lithuania—hints at the tensions between Rome and Eastern Orthodoxy, noted The New York Times.


Waiting for Russia

The establishment of friendly relations with Russia should be made one of the key foreign policy priorities in the future, acccording to Latvian President Vaira Vīķe-Freiberga. After a meeting with Prime Minister Andris Bērziņš, Foreign Minister Indulis Bērziņš and Parliament Speaker Jānis Straume, the President said she is hoping for "a signal" from Russia soon. "Latvia wants to establish normal and mutually friendly relations with Russia, and it is of utmost importance. I am ready to meet with Russian President Vladimir Putin and we are waiting for a signal from Russia," the Latvian president told reporters.

Meanwhile, the Latvian Port Council decided to grant LVL 37,600 (about USD 61,000) for the establishment of a Latvian consulate in Kaliningrad.


Wave that flag

The national flag will now have to be displayed at all state and municipal educational institutions, according to amendments to the Flag Law passed by the Saeima this week. Education and Science Minister Kārlis Greiškalns proposed the change so that the "national pride of children and young people is developed, as well as patriotism and respect for their educational institution and the state."

Latvians are reading...

Traffic in Riga was disrupted as several hundred fans of Harry Potter—the children's book series schoolboy wizard—headed to snap up the latest Latvian translation of the series written by British author J K Rowling.

The Latvian Booksellers Association announced that the best-selling book in Latvia last year was Paulo Cuelho's The Pilgrimage: A Contemporary Quest for Ancient Wisdom. Among translated works, Cuelho is followed by Kurt Vonnegut's Deadeye Dick and Cat's Cradle, and Arthur Golden's Memoirs of a Geisha. In the Latvian book category, the leaders were Vizma Belševica with her Bille's Beautiful Youth and Jānis Anmanis' 222 Haiku on Love, Art, the Land, the Universe and Woman.


And in other news...

  • The average gross salary figure stood at LVL 149.0 (USD 241.6) in October 2000, an increase of six percent year-on-year.
  • The central bank said it expected foreign direct investment (FDI) inflow during 2000 to show a rise, year-on-year, despite delays in finalizing state company privatizations. Latvia saw its 1999 FDI grow by USD 255.8 million to USD 1.81 billion—a cumulative figure since 1996, and a rise of 16.4 percent year-on-year. The cumulative figure, after nine months of 2000 stood at USD 1.963 billion, up USD 315.4 million from the end of September 1999. The top two branches in terms of foreign investment, are trade and financial intermediary services—at 21.3 and 20.6 percent of the total, followed by transport and telecommunications at 18.5 percent. Manufacturing and real estate come next at 16.3 and 10.9 percent.
  • Mobile phone operator Baltcom GSM said its price war with rival Latvijas Mobilais Telefons (Latvian Mobile Telephone, LMT) will soon extend to the corporate client sphere. Baltcom has been aggressively pushing down prices in the pre-paid card market.
  • The government said it planned to advertise for consultants to help organize the sale of third-generation mobile telephone licenses. Finance Minister Gundars Bērziņš said earlier this month that a third-generation license tender could fetch from around LVL 50 million (USD 80.65 million) to as much as LVL 120 million.
  • The Competitions Council fined Staburadze for failing to inform the council it had bought the country's largest chocolate maker, Laima. The council has yet to decide whether the merger of the two companies can go ahead.
  • The share of non-resident deposits in Latvian commercial banks—worth LVL 968 million—for the first time exceeded 50 percent of the total, LVL 1.8 billion.
  • Latvian Internet service providers saw turnover jump 66 percent in 2000 to LVL 5.25 million. Turnover is expected to rise to LVL 9.7 million (USD 15.63 million) this year. E-commerce volumes totaled only LVL six million in 2000.
  • Finnish companies Stockmann and Rautakirja signed a deal taking over a land lease in the centre of Riga to construct a LVL 24 million (USD 38.74 million) shopping center and movie complex, which is set to open by the end of 2002.

Daria Kulagina, 2 February 2001

Moving on:


Neatkarīgā Rīta Avīze
Dienas Bizness
Bizness Baltija


Gusztáv Kosztolányi
Anatomy of a Disaster

Mel Huang
Privatising the Baltics

Jan Čulík
Myths and Politics

Bernhard Seliger
Unemployment in East Germany

Sam Vaknin
The Scourge of Transition

Eva Sobotka
Dzurinda's Mission

Slavko Živanov
Going Down Together

Andrew James Horton
Balabanov's Nationalism

Juras T Ryfa
Forms of Hope

Mel Huang
Vytautas Landsbergis's autobiography

Štěpán Kotrba NEW!
Sow and Reap

Brian J Požun
Shedding the Balkan Skin

Martin D Brown
Czech Historical Amnesia

Dejan Anastasijević (ed)
Out of Time

Gusztáv Kosztolányi
Hungarian Oil Scandal

Sam Vaknin
After the Rain

Press Reviews:
Andrea Mrozek
Gain and Loss

Oliver Craske
UK: Not Such a Soft Touch, Sadly


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