Nations in Transit - Latvia (2005)

Capital: Riga
Population: 2,300,000
Status: Free
PPP: $3,480
Private Sector as % of GNI: na
Life Expectancy: 72
Religious Groups: Lutheran, Roman Catholic, Russian Orthodox
Ethnic Groups: Latvian (57 percent), Russian (30 percent), Byelorussian (4 percent), Ukrainian (3 percent), Polish (3 percent), other (3 percent)

Executive Summary

Latvia, slightly smaller in area than Ireland and situated on the eastern shores of the Baltic Sea, has had a complex and checkered history. After winning independence in 1920, Latvia was able to strengthen its state institutions over two decades of self-rule. Its independence was terminated abruptly during World War II, first by the Soviet occupation from 1940 to 1941, then by the Nazi occupation from 1941 to 1945. From 1945 to 1991, Latvia remained under Soviet control as 1 of 15 republics of the USSR. It was able to declare its independence following the unsuccessful putsch against Soviet president Mikhail Gorbachev on August 21,1991.

The road to a fuller democracy, a functioning market economy, and an improved civil society has been made much easier by Latvia's historical exposure to two decades of independence, which most former Soviet states (other than Estonia and Lithuania) did not experience. After a decade of improvements, often supported by world organizations and prosperous neighboring countries, Latvia has reached a much more secure level of "normalization" reflected by greater stability and predictability in economics, politics, and civil society.

The pessimism of the immediate post-independence period in Latvia has waned, but a new polarization between the growing middle class and those who have not been able to partake in the economic upturn has resulted in tensions and discontent. Riga and other larger urban areas have appropriated a disproportionate share of this new prosperity, leaving rural areas, particularly in southeast Latvia, stuck in the economic doldrums. The unfamiliar stresses and strains of the market economy and the burden of welfare now resting on individual shoulders have created widespread anxiety and wistful nostalgia for the past, when life was less complicated. Only 55 percent of Latvia's inhabitants indicated in a February 2004 Eurobarometer survey that they were satisfied with life. In June 2004,63 percent claimed that their family "material situation" had been better 15 years earlier, when Latvia was ruled by the Communist Party. At the same time, only a tiny fraction would want to return to a Communist regime.

Expectations for economic growth and security were raised by Latvia's entry into the European Union (EU) on May 1,2004, and its membership in NATO in March. Latvia is slowly becoming accustomed to being part of a larger, more prosperous community and to being militarily secure.

The increasing awareness of the value of nongovernmental organizations (NGOs) and liberal Internet access to all types of government information have slowly built a sense of democracy and a more informed electorate. The highly competitive Latvian mass media are proving to be reliable sources of information and watchdogs against governmental abuses of power, and Latvia's political system functions well despite a perpetual series of minority governments. The continuity and regal character of the presidency have made this position one of the pillars of political stability.

The economy continued to develop at a dynamic pace, reaching a growth rate for the gross national product of 8.5 percent in 2004 and thus continuing the growth rate of previous years (6 percent between 1996 and 2003). Latvia's international credit ratings were raised to the "A" level for certain loan categories. By most economic measures, Latvia is a success story; nevertheless, some problems persist chiefly corruption, poverty, and relations between citizens and noncitizens over language and other issues.

National Democratic Governance. In spite of the fall of two governments in 2004 and the open squabbling among coalition parties, there is a broad consensus on most areas of policy among the main governmental parties that can best be categorized as center-right. As in most parliamentary democracies, the government initiates most legislation about 70 percent and sets the agenda for voting. The Parliament, however, can and does modify legislation and at times has taken independent action. Internet access to all meeting agendas and draft documents, from those at cabinet level to meetings of senior civil servants, makes Latvia an example of openness. The general public also has access to the spending details of individual ministries. The Law on Civil Service passed in 2001 has resulted in better service and administration. In May 2004, Latvia became a member of the EU and can participate with other democratic regimes in setting common parameters and standards. The country is receiving substantial aid from the EU, and this is helping to raise the responsiveness and efficiency of state service to the population. The new rating for national democratic governance is set at 2.25. Stability generally prevailed throughout the changes in government; however, most legislative decisions are closely tied to the executive branch.

Electoral Process. Latvia is a parliamentary democracy, with elections to the 100-member Parliament held every four years. The most recent parliamentary elections took place in October 2002 and were considered by the Organization for Security and Cooperation in Europe to have achieved a "clear entrenchment of the democratic election process." In 2004, as a new EU member, Latvia voted to elect 9 deputies to the 732-member European Parliament. Turnout was relatively low at 41.2 percent – but significantly better than the average of 26.4 percent for the other new democracies that also joined the EU in 2004. The elections were considered to be fair, and no irregularities were reported. Latvia's rating for electoral process remains 1.75.

Civil Society. There was a noticeable increase in the activity and visibility of NGOs in Latvia in 2004. This is especially true of groups within the Russophone sector of society, but this rise has affected all interest groups in all areas of the country. In part, this has happened as a result of the growing democratic maturity of society; but as well, certain events and appointments to important positions have acted as precipitating catalysts for NGO resurgence. In 2004, changes in the Russian school curriculum requiring that several more subjects be taught in Latvian precipitated a flurry of new organizational initiatives. Russian students picketed the legislature to stop educational reforms in Russian schools, and many thousands joined the Association for the Support of Russian Language in Schools in Latvia. This organization in turn catalyzed the creation of other organizations, including the United Russian Society of Latvia. Membership in the EU and the possibility of funding from this source also spurred many NGOs to become more organized and cooperative with other groups and specialists. In October 2004, representatives of rural NGOs met to discuss ways of cooperating and coordinating their goals and resources to achieve long-term sustainable development of rural areas. In 2004, an environmental NGO won a victory at the European Court of Human Rights, and NGOs succeeded in blocking the construction of a large pulp mill planned on an island in the Daugava River upstream from Riga. Latvia's rating for civil society improves from 2.00 to 1.75 because of the palpable new vigor of NGOs and their growing participation in the formation of governmental decisions.

Independent Media. Latvian mass media remain diverse, competitive, and buoyant. Criminal liability for defaming state officials has now been effectively removed by the Parliament. Broadcast media are balanced, with a mixture of private and state-regulated enterprises. Reporters Without Borders rated Latvia 10th out of 167 countries in its third annual worldwide Index of Press Freedom, just behind Switzerland and New Zealand. Latvia's rating for independent media remains 1.50.

Local Democratic Governance. Latvia is in a quandary with respect to local governments. There are over 500 small units, but people are reluctant to merge them into larger, more efficient units and thus lose the personal intimacy of established relationships. Local governments traditionally receive better ratings and higher trust than national structures, but there is a serious and growing gap between the broad array of responsibilities of local governments and their limited financial and human resources. The very wide gulf between the wealthier and less well-endowed municipalities leads to geographic inequity in providing public services. The new rating for local democratic governance is set at 2.50 owing to the relatively high esteem and accessibility of most local governments among the population. However, excessive fragmentation results in a dearth of resources and capacity to fulfill all responsibilities adequately.

Judicial Framework and Independence. In 2004, Latvia took giant steps in creating an administrative court system and administrative code that will enable the participation of public organizations as "friends of the court" in trials. The new administrative courts allow for flexible oral or written adjudication of disputes between the public and tax officials, police, welfare assessors, and, indeed, all government structures. This has diverted a significant number of cases from the main court system, thus shortening pretrial waiting periods and detention time. Other positive changes in 2004 included a growing number of courtrooms, the move toward total computerization and public access to cases, prison reforms, and the respected performance of the Constitutional Court. The status, pay, and number of judges continued to increase, and they are now hired on a competitive basis. However, the high incidence of pretrial detention and lack of access to legal aid for the poor in civil cases are ongoing problems. Latvia's judicial framework and independence rating improves from 2.00 to 1.75 owing to the creation of a new court system and new technical services that increased transparency and efficiency.

Corruption. Transparency International's 2004 Corruption Perceptions Index ranked Latvia 57th out of 146 countries. Latvia's Anti Corruption Bureau (KNAB) originally held great promise, but problems of leadership and financing, as well as the scattering of anticorruption responsibilities among half a dozen organizations, have somewhat blunted its credibility and output. While all signs indicate relatively limited corruption in middle and lower levels of administration, there are unproven but constant rumors of Latvian and Russian business "oligarchs" making backroom deals with top state administrators and politicians. The suspicions of business barons who "capture" state institutions by economic might, first formulated by the World Bank, have remained unproven but also have not been proven wrong. Thus, the popular perception of sophisticated, large-scale corruption involving tax evasion, and of collusion between certain businesses and the upper tiers of government, continues unabated and increases the lack of trust felt toward the national governmental structures. Latvia's corruption rating remains at 3.50.

Outlook for 2005. In 2005, Latvia will continue to consolidate its position in the EU and NATO. Most Latvians want to see more governmental continuity and thus are prepared to support the coalition government to avoid holding new parliamentary elections until the scheduled date of October 2006. State institutions will continue to function with increased efficiency owing to new EU guidelines and funding. Local government elections in March 2005 may lead to more serious initiatives for the amalgamation of tiny municipalities. Russian-Latvian relations within the country will experience some buffeting, but there seems to be a will to lower tensions by both sides. These internal tensions have also become a focal point for criticism by Russia, which believes it has a responsibility with respect to the Russophone diaspora. Rapid economic growth in the heartland, especially in Riga and the larger cities, will create even more discontent in the hinterlands of southeast Latvia (Latgale), where stagnation will likely deepen.

National Governance (Score: 2.25)

In contrast with the two other Baltic states, Lithuania and Estonia, which after the Soviet period developed new constitutions on the basis of prewar ones, Latvia chose to maintain its original Constitution, introduced in 1922. This was done to reinforce the perception of continuity from the first independence period (1918-1940) and to accentuate the illegitimacy of the long Soviet occupation. A major addition to this Constitution was made in October 1998 when the Saeima (Parliament) added an extensive body of rules protecting human rights.

The current Latvian Constitution incorporates the basic requirements of democracy, setting out the rules for elections, participation in civic life, and citizenship. The structures and foundations for democratic rule are robust and unchallenged. Not a single political party has called for a return to a Soviet-style system or to a benevolent strong-hand leadership or dictatorship. This does not mean that everybody is satisfied with the way actual democracy functions in Latvia. An opinion poll published in the Latvian Internet portal Delfi in July found that 35 percent of people were satisfied, but 39 percent were somewhat and 18 percent very dissatisfied with democracy in Latvia. Ethnic Latvians tended to be more satisfied than people from minority communities. Most probably people are disillusioned not with democracy itself, but with the existing policies and coalition party politics that have created or reinforced this negative attitude. The same poll suggested that this was the case, finding that the number of those who trusted the government fell from 46 percent the previous autumn to 28 percent in July 2004. Similarly, trust in Latvia's Parliament declined from 30 to 20 percent over the same period, and trust in political parties declined from 12 to 9 percent. Other institutions did much better:Television was trusted by 69 percent, the press by 52 percent, the armed forces by 47 percent, the UN by 45 percent, churches, charities, and NGOs all by 44 percent, the European Union (EU) by 39 percent, the police 34 by percent, big business by 32 percent, the court system by 29 percent, and unions by 21 percent.

There is a consensus in Latvia that democracy should be retained. However, 45 percent of people polled in December 2003 were willing to tolerate "a small reining in of political freedom" to attain economic improvement for the population, whereas 35 percent opposed such a trade-off.

Latvia's Parliament is not well structured to facilitate dialogue with voters. Individual deputies are not responsible for a specific geographic area, so people do not have a local representative office where they can air their problems and ask for assistance. Indeed, this absence of parliamentary "mini-ombudsmen" is a problem in all countries that rely on proportional electoral systems. Another problem is the relatively underdeveloped lobbying structure in the country. Lobbying on behalf of an interest group is still seen as selfish and unethical and is usually associated with corruption. Parliamentarians, however, are able to gauge the popular will through a very active media and through increasingly vocal professional and ethnic associations. Moreover, new channels for participation in decision making have been created. Since June 2001, nongovernmental organization (NGO) representatives can officially attend meetings of the state secretaries in the chancellery of the cabinet, where new policy ideas, legal initiatives, and information about future proposals are discussed and vetted and sent to the respective ministries for further input.

The Latvian government has made significant strides in providing public access to various state documents. These include Internet access to proposed legislation and to the agendas of the Parliament, the cabinet, state secretaries, cabinet committees, and parliamentary committees. Likewise, anyone can access the financial data of all ministries. Transcripts of parliamentary sessions as well as the protocols of cabinet and cabinet committee meetings are also available online. The Parliament has a vast support system of specialists and research librarians. Deputies can hire assistants and have access to the state-financed offices of their respective political parties. Unfortunately, not all deputies have offices, and very few of them have the ability to contact their electorate within Latvia's five broad electoral districts. Investigations can be carried out by parliamentary committees, which are empowered to call ministers and others to testify.

Latvia uses a modified parliamentary system where executive and legislative powers are closely tied. Deputies have the power to initiate legislation, and their votes determine whether a bill becomes law. The real center of power, however, lies with the cabinet and the ministers representing the parties in government, as is the case in most parliamentary democracies. Support for legislation is most often orchestrated before a bill reaches the Parliament. However, some surprises do emerge when deputies are allowed the use of a secret ballot.

The judiciary is independent of direct government pressure once the Parliament confirms a judge's candidacy. However, judges are dependent on the Ministry of Justice for their wages, administrative support, offices, and instructions on new laws and procedures. The ministry's department tasked with administering most courts was expected to become much more independent in May 2004, when it was to be guided by a 12-person council rather than the ministry, but this change was postponed.

In the Latvian political system, the president functions as head of state and has the power to appoint the prime minister and veto legislation. Vetoed bills, however, can become law after a repeat majority vote in the Parliament. President Vaira Vike-Freiberga has contributed to political stability by her consistency, political neutrality, and high popular support. Her assessments of political and judicial matters are taken seriously.

The Latvian Constitution is a major check on governmental power. The creation of a separate Constitutional Court in 1996 focused the best legal minds on the defense of constitutional rights. Their judgments have covered a wide range of legal issues and have garnered a high level of trust from officials and from the entire population. According to polls, the Constitutional Court is considered one of the most trustworthy institutions in Latvia and, indeed, has helped diminish popular cynicism about the Latvian system of power. The court's chair is Aivars Endzins, a former parliamentary deputy and seasoned political leader.

In general, Latvia's government does not interfere in the economy except to set broad parameters for monetary and fiscal policies. There is as yet no consensus with respect to the privatization of certain large industries in which the government holds the majority or a large proportion of shares. Such industries as the state energy company Latvenergo, the communications company Lattelekom, the oil refining and transport concern Ventspils Nafta, and others have been pressed for privatization by some parties, but this has been strongly resisted by others.

The Latvian governmental system is stable in spite of the frequent changes in the configuration of coalition parties. About 70 percent of legislation is initiated by the cabinet, about 15 percent by parliamentary committees, and 15 percent by individual deputies or groups of deputies. The president rarely introduces legislation. All bills require majority approval of the Parliament and the signature of the president. When the Parliament is not in session, the cabinet can issue regulations, which then carry the force of law until the Parliament reconvenes and either ratifies or vetoes the interim regulations.

If the political system is stable, the cabinets have not been, with frequent changes of ministers and prime ministers, a pattern that reflects the absence of a dominant party in the Parliament. The current Parliament has eight party factions. This is greater than the number elected in October 2002 because the leftist alliance For Human Rights in a United Latvia later split into three separate factions. Moreover, several deputies abandoned party affiliations and remained in the Parliament as independents.

In Latvia, governments often rupture over matters of policy, budgets, personalities, and appointments or for strategic electoral reasons. The relative instability was highlighted by two major changes in leadership in 2004. The four-party coalition led by Prime Minister Einars Repse that had held power since October 2002 was replaced in March by a minority-supported three-party coalition headed by Indulis Emsis. The new coalition survived almost eight months with support from noncoalition left-oriented deputies who saw Emsis as a lesser challenge than Repse. Nevertheless, this coalition was defeated on a vote of the Parliament in October and was replaced in December by a new four-party majority coalition headed by Aigars Kalvitis.

The executive branch has received much support from world organizations and Western countries in streamlining organizational efficiency and in maintaining popular access. Independent audit and investigative rules have helped keep the executive branch free of any major monetary scandals, although they have not entirely succeeded in eliminating vestiges of waste, inaction, and incompetence.

In 2004, Latvian political leadership experienced several episodes of conflict with the general public and NGOs. Emsis was heavily criticized for the manner in which he appointed the new chair of the Anti Corruption Bureau (KNAB), Aleksei Loskutovs, and the less than transparent way in which he appointed the European Commission's Latvian representative, Ingrida Udre, in August. Opposition to Udre's appointment created a confrontation with President Vike-Freiberga, who bluntly indicated that the NGOs had no business criticizing governmental appointments and that such criticism was actually unconstitutional. These remarks surprised most people and led to a widespread discussion about the role of NGOs, freedom of speech, and civil society. The president ultimately achieved a reconciliation with the NGOs she had criticized, but she lost much prestige and support in the process. Meanwhile, Udre's candidacy was thought to be unacceptable to the European Parliament, and she was replaced by a noncontroversial former politician and diplomat, Andris Piebalgs.

The civil service in Latvia has been subject to many attempts at reform. The most significant and comprehensive of these has been the Law on the Structure of State Administration, passed in 2001. The purpose of this law as stated in its preamble is "to secure a democratic, lawful, effective, open, and publicly accessible state administration." The law has tried to make the civil service more "people-friendly." It requires state administrators to observe human rights, work in a fair and nonpartisan manner according to existing laws and rights, and observe the principles of "good administration." This concept includes the guarantee of openness, protection of personal information, fair and timely implementation of procedures, and public disclosure of state activities. Civil servants are expected to have completed higher education or to earn a degree by a given date. The law also includes clauses on dismissal for cause, requirements for contracts, limitations of power, financing of subsidiary agencies, hierarchy of officials, delegation of tasks to private individuals or nonstate organizations, issues of liability, and auditing procedures.

Although this law represented a major upgrade in the role of civil servants and their duties, it does not address the situation of municipal civil servants. Likewise, the mechanisms for addressing complaints are not precisely defined. Because of low salaries, the turnover rate in civil service positions is high, and a number of able individuals have gone to work in more lucrative jobs in the private sector. Many people in public administration are students who work on limited contracts or on a part-time basis and usually do not remain after completing their degrees. The Ministry of Justice, for example, has an annual turnover rate of 30 percent. The Latvian civil service comprises about 10 percent Russophones, reflecting the strict Latvian-language requirements.

The military and security services were reconstituted almost in their entirety after the country declared independence in August 1991. They are subject to civilian control and have been able to gain a large degree of respect from the public. The president is commander in chief of the armed forces, and the Parliament entirely controls their budgets. The security forces have been quite conscious of their role and go to great lengths to publicize their activities, problems, and dependence on civic support.

Electoral Process (Score: 1.75)

Latvia is a parliamentary democracy. Elections to the 100-member Parliament are held every four years. Deputies are elected proportionally from party lists in five large electoral districts. The parties determine the ranking of names on the electoral lists, but voters can indicate their own preferences when marking their ballots. The governing cabinet is made up of individual parliamentary deputies whose seats are filled by the next candidate in line on their respective party list. The president is elected by an absolute majority vote in the Parliament rather than by the general population.

The most recent parliamentary elections in October 2002 marked "a clear entrenchment of the democratic election process," according to the report of the Organization for Security and Cooperation in Europe observer mission. The election process was seen as well administered and conducted in accordance with international standards. The voter turnout of 72 percent continued a tradition of relatively high turnout seen in previous elections. This was the fourth general parliamentary election following Latvia's renewed independence in 1991.

Only citizens of Latvia can vote at the national and municipal levels. Citizenship is open to all permanent residents (with a few exceptions, such as former KGB agents) who have lived in Latvia for five years, pass a simple language and history test, and swear allegiance to the state. A naturalization program began in 1995, and by 2004 more than 85,000 people had received Latvian citizenship. All ethnic minorities, including Russians, with direct family ties to Latvia prior to the Red Army's invasion of Latvia in June 1940 were automatically considered citizens of Latvia. Some 48 percent of ethnic Russians have Latvian citizenship. All those who came to Latvia during the Soviet period, however, can become citizens only through the naturalization process. About 21 percent of Latvia's inhabitants do not have citizenship.

Since all Latvian political parties have a weak membership base, they rely heavily on expensive media advertising. However, party platforms in general do not differ significantly from one another. All desire to fight corruption, lower taxes, decrease poverty, reduce economic disparities among regions and people, and maximize Latvia's benefits from the EU.

During the 2002 elections, six parties exceeded the 5 percent threshold for representation in the Parliament. However, the leading party, New Era, gained only 26 out of 100 seats. For Human Rights in a United Latvia (HRUL) won 24 seats, the People's Party 21, Latvia's First 10, the Green and Farmers' Union 12, and Fatherland and Freedom 7. Nearly 16 percent of the votes were cast for parties that failed to clear the 5 percent barrier.

Latvian presidents are chosen for a term of four years by the 100-member Parliament and require 51 votes to be elected. In the most recent presidential election, held on June 20,2003, only one candidate was on the ballot: the incumbent, Vaira Vike-Freiberga. She was reelected with 88 votes, compared with the 53 she received when first elected in June 1999.

By becoming a full member of the EU in May 2004, Latvia earned the right to send 9 deputies to the 732-member European Parliament in the elections held in June. Voter participation was relatively low at 41.2 percent, but not far below the EU average of 45.3 percent. Surprisingly, the nationalist Fatherland and Freedom Party garnered the most votes 29.8 percent followed by New Era with 19.7 percent and HRUL with 10.7 percent. All three were opposition parties. The parties of the ruling coalition did poorly: the People's Party received 6.7 percent, the Green and Farmers' Union 4.3 percent, and Latvia's First won just 3.3 percent.

Unlike in local and national elections, restrictions on candidates with former KGB affiliation or Communist Party membership after January 1991 were dropped for the European elections. Thus Tatyana Zhdanoka, disqualified from standing in earlier elections because of her Communist Party membership after the cutoff date, became a European Parliament deputy for the HRUL. Campaign spending in these elections was not high. The highest spender, the People's Party, invested 65,178 lats (about US$120,000), and none of the other 16 parties in the campaign spent more than US$100,000.

Civil Society (Score: 1.75)

A noticeable increase in the activity and visibility of NGOs in Latvia occurred in 2004. This was especially true within the Russophone sector of society, but the rise extended to all sectors throughout the country. In part, this reflects the growing democratic maturity of society, although certain events and personnel decisions also acted as precipitating catalysts for more intensive activities and for the creation of new organizations. Membership in the EU and the possibility of funding from this source have spurred many in civil society to become more energized and assertive in creating and mobilizing local groups. Indeed, the EU has set aside about €1 billion out of its €100-billion budget to support NGO activities.

Civil society organizations are regulated and protected by the Latvian Constitution and by legislation on public organizations passed in 1992,2003, and 2004. The latter two laws require NGOs to reregister between April 1,2004, and December 31,2005. Some observers fear that many organizations will not fulfill the requirements of this new process and will lose their official accreditation, pointing out that in 2002, for example, more than a third of all registered public organizations failed to submit annual reports of their activities, which suggests they were inactive. NGO annual reports must include an overview of the group's income and expenditures and are available for perusal by the public.

Official data show that the number of NGOs has grown at a rapid but steady rate since 1991, when the entire country had only 50 registered nonprofits. In 1993, there were 978 NGOs; in January 2004,7, 704. In view of this growing presence, it is not surprising that there has been a parallel growth in public awareness of NGOs. In 1998,44 percent of respondents to a poll indicated that they knew nothing about NGOs, whereas by January 2004, the uninformed segment had decreased to 26 percent, and even they were often familiar with individual organizations when these were named. The concentration of NGOs correlates closely with the average per capita income of cities and regions. Not surprisingly, the capital city of Riga has the greatest number of such groups, or about two thirds of the total, while poorer areas in southeastern Latvia have the fewest.

A nationwide survey conducted in November 2003 found that 53.6 percent of respondents were neither members of nor participants in the work of any civil society organizations. Faith-based organizations, unions, sports and recreation groups, and cultural groups accounted for the bulk of public activities. Groups more associated with political activism were much less well represented. It is significant that less than 1 percent of respondents belonged to organized ethnic minority groups.

Acknowledged Participation or Membership in Public Organizations in Latvia, November 2003 Survey

Lower rates of participation were found among those over 55 years of age, Russophones, noncitizens, those living in Riga (in contrast with the high number of NGOs in the city), and those with less education, no job, or low incomes.

At the fall of Communism, Latvia had no experience maintaining independent, self-sustaining organizations. Since 1996, the Danish government, the UN Development Program, and the Soros Foundation have supported the NGO Center in Riga, which has become an extremely useful resource for legal support, management and leadership training, and networking. Today, the latter two organizations are considered the "owners" of this center, which publishes numerous handbooks, offers courses, and invites experts to address various aspects of group sustainability. Assistance is offered in Latvian, Russian, and English.

According to the NGO Center (which would not usually service church or sports organizations and unions), about 70 percent of activists in these organizations are women. About 70 percent of NGOs have no permanent staff, and over half have a membership under 30 people. Only 4 percent of groups have more than 500 members, according to the daily Diena. The NGO Center says it works with about 1,000 NGOs. New NGO Centers have opened in other cities such as Aluksne, Talsi, and Ventspils, and a center for about 250 minority ethnic organizations was opened in March 2004.

Rural areas have overcome their traditional social lethargy and begun to organize networks of groups with common interests. In October 2004,98 representatives from 117 rural NGOs met to discuss ways of cooperating and coordinating their goals and resources to achieve long-term sustainable development of rural areas. The prospects of obtaining EU grants aimed at underdeveloped regions probably helped motivate this gathering.

In spite of the evident uneasiness with the direction of the ship of state, about half of Latvians do not believe that any protest actions on their part, including strikes, pickets, or petitions, can change things for the better, according to the SKDS polling organization. However, the survey conducted in July 2004 did find that 44 percent of those polled felt that their participation in such actions could result in favorable changes.

In 2004, Latvia witnessed a considerable increase in interest group activities. Russian students picketed the legislature to stop educational reforms in Russian schools, where grade 10 students were expected to learn 60 percent of their subjects in Latvian beginning in September 2004. Delna (the Latvian branch of Transparency International) and several EU support organizations picketed the Parliament after Ingrida Udre was chosen as Latvia's candidate for the European Commission. Various medical groups and nurses also went on work-to-rule strikes in search of higher wages. Many NGOs successfully opposed the construction of a proposed Scandinavian-backed pulp mill on an island in the Daugava River upstream from Riga.

Opposition to the government's decision to reduce the use of the Russian language in schools precipitated several important changes in Russophone society. Over half of all Russian students took part in protests. Several organizations to support the use of Russian in schools and Russian culture more generally sprang up in 2004. The most ambitious new Russophone group, the United Russian Society of Latvia (OKROL), held its founding convention in September 2004 and quickly mobilized many people and established a number of regional branches. OKROL also planned to set up offices in Strasbourg and Moscow. According to its statutes, OKROL's goals include "the representation of the interests of the Russophone part of society, the protection of the civil, linguistic, educational, cultural, national, economic, and other interests of the Russian community, the maintenance and development of the culture and traditions of Russians as well as other minority groups and the protection of human rights." Note the three-tier distinction made with reference to Russophones, Russians, and minority groups.

It appears that Latvian society is emerging from relative apathy in other areas as well. Environmental protection concerns are articulated on a regular basis and find their way into the mass media. Volunteers are patrolling salmon streams together with fish inspectors to prevent poaching, with dramatic results in spawning of new fry. One NGO, the Organization of Environment Protection (VAK) won a victory in the European Court of Human Rights in Strasbourg at the end of May 2004.

In 2004, police officers and other personnel began organizing support for a union. In Riga alone, 700 police officers signed a petition in favor of changing the law to allow them to start a union. NGOs can now also be accepted as an official amicus curiae in legal cases and as resources for the new administrative court system. Latvian civil society organizations are also reorienting themselves to the broader EU scene. In February 2004, five NGO leaders spent several weeks observing how larger established Western European NGOs work with the EU. They were expected to educate other Latvian NGO leaders about the new possibilities and styles in this larger forum. As in all post-Soviet societies, philanthropy and volunteerism are not widespread. But newly created community volunteer groups, like those in the city of Talsi, have been held up as models. A resource center for women was recently created.

Traditional Christian religious groups of Lutheran, Catholic, and Orthodox membership are slowly beginning to conduct charitable activities, but the lack of funding and basic infrastructure and the low percentage of actual congregants (5-6 percent of the population) have limited the scope of their initiatives. In Riga, some 15 Jewish organizations and institutions are active, including a school, hospital, museum, veterans' organization, social aid organization, youth center, and library. All of these are part of the larger Riga Jewish Association. Approximately 85 nontraditional faith-based organizations have been helped by significant external financing and organizational support. Included are the Jehovah's Witnesses, Mormons, Glad Tidings, New Age, and Hare Krishnas. The activism and Western-supported charity work of these groups have attracted many new members.

In 2004, almost no groups seriously threatened political or social stability, although many Latvians were worried about the potentially negative impact of those trying to mobilize Russian students to boycott classes and attend mass meetings in their quest to abrogate the new educational law for Russian schools.

Since 2002, NGO representatives have been allowed to participate in the preparation of state policies by attending meetings of the state secretaries in the chancellery. Many groups are consulted by various ministries and parliamentary committees. The NGO Center claims that over 80 percent of Riga-based groups have taken part in some form of interaction with national and local governments and that about one third of these have included government representatives in their leadership structures. The Riga city government invited NGOs and various individuals to discuss the city's development plan, including issues of zoning, transportation, building construction, and nature conservation.

The Latvian media have been very cooperative with NGOs and open to their views. Issues of public interest receive fair coverage from state and private broadcast and print media. The Internet news site Delfi, available in Latvian and Russian, provides a forum for discussions and controversial viewpoints.

There are broad differences of opinion between native speakers of Latvian and Russophones. A large majority of Latvians are opposed to Russian as a second state language (77 percent) and support reducing the use of Russian in schools for the Russian minority (76 percent). Among Russophones, 84 percent favor making Russian a state language and 68 percent oppose the educational reform, Latvijas Avize reported in September 2004. In spite of such diametrically opposite positions, there appears to be a certain reserve of goodwill within both groups in the almost unanimous support by Latvians (93 percent) and Russophones (97 percent) for the statement "We must respect the national culture, religion, and traditions of all groups in Latvia even if these are very different from ours." Two thirds of Latvians were willing to allow state support for the protection of different ethnic cultures and traditions.

Independent Media (Score: 1.50)

The Latvian Constitution guarantees freedom of speech, information, and thought. Censorship is forbidden. In 2003, the newspaper Diena successfully challenged laws adopted in 1999 that imposed prison sentences and heavy fines for spreading false information about members of Parliament or defaming state representatives. In January 2004, criminal liability for the defamation of state officials was effectively ended. In 2003, the Constitutional Court struck down a law that required 75 percent of broadcasting in any 24-hour period to be in the Latvian language. This repeal means that the language of broadcasting will be determined solely by market considerations.

The Latvian media are free to disseminate information and views, limited only by libel considerations and the pressures of the market. Investigative journalists are free to pursue various sensitive topics, including government waste and corruption. The mass media generally enjoy editorial independence, although government sources are not always willing to release information on request. The leading newspapers readily publish a broad range of opinions from specialists and NGOs. Many newspapers are available free of charge on the Internet. About 30 percent of the total population accesses the Internet, and this figure is increasing rapidly.

Latvians can choose between state-subsidized and privately owned television and radio. In television, the private Latvijas Neatkariga Televizija (LNT) is the most popular station, with 20.3 percent of viewers as of October 2004, followed by TV3 with 18.6 percent. Public television regained some of its audience share after expanding its viewing hours. The state-owned LTV1 had a 14.2 percent share, and LTV7 attracted 4.7 percent of viewers.

Radio is dominated by state ownership. Latvijas Radio, with its four different services, claimed 48 percent of the total audience in the summer of 2003. Latvijas Radio 2 held a solid 25 percent. It broadcasts mostly Latvian music, with a sprinkling of English-language country and western. Latvijas Radio 4 broadcasts in Russian and claimed 7 percent of the total audience. Software House, with a 17 percent share, was the largest private station. Next in popularity came Star FM and European Hit Radio with 5 percent each.

The most popular daily newspapers as of summer 2003 were Diena, Vesti Segodna (Russian), Neatkariga Rita Avize, and Chas (Russian), according to the market research firms Baltic Data House and BMF. In 2003, a Russophone businessman, Valeri Belokon, started a relatively upscale and technically innovative Russian-language daily, Telegraph, to provide a more "constructive tone in the Russian press," but the venture has not been lucrative, and in 2004 the paper shrank from 24 pages to 16.

The two major-language communities live in their own media spaces, and few read or view the other's media. Diena did publish in both languages until 1999 but shut down its Russian-language edition for lack of readers. Other newspapers have experienced a similar problem. There are many Latvian- and Russian-language periodicals, among which monthly women's magazines such as Santa, Cosmopolitan (Latvian), and Lilit (Russian) are the most popular. The state publishes the almost daily newspaper of record, Latvijas Vestnesis, which in May 2004 had the distinction of receiving a certificate of quality from the certification agency BVQI.

Local and foreign firms and individuals own shares in the Latvian mass media, but exact ownership patterns are not always transparent. The largest shareholder in Diena is the Bonnier family of Sweden. The privately controlled Ventspils Nafta (VN) oil company owns three and possibly four of Latvia's daily newspapers. The chief representative of this corporation has been Aivars Lembergs, mayor of the city of Ventspils. Yet who exactly controls VN is not public knowledge. As a whole, however, these newspapers do not appear to be noticeably influenced by their owners.

The distribution of advertising expenditures in August 2004 in the mass media not surprisingly was focused predominantly on television (36.5 percent) and newspapers (31.6 percent). Shares for other media were 12.7 percent for magazines, 11.6 percent for radio, 4.9 percent for outdoor advertising, 1.9 percent on the Internet, and 0.8 percent on film. The 16.8 percent increase in total advertising sales over August 2003 reflects the rapid growth of the economy and of consumerism. The globalizing effects of advertising can also be seen from the five leading advertisers: Procter & Gamble, Coca-Cola, the Swedish media group Modern Times, Colgate-Palmolive, and Aldaris (a Latvian beer maker). Perhaps this is why some of the leading world media corporations are taking note of the Baltic potential. It is widely claimed in Riga that Springer Verlag of Germany wants to dominate the Baltic media market. Rupert Murdoch of News Corporation is also said to be a major owner of LNT, Diena reported.

Journalists and media outlets have been able to form their own viable professional associations, notably the Latvian Journalists Union and the Latvian Press Publishers Association. Reporters Without Borders puts Latvia 10th out of 167 countries in its rankings of press freedom. In Freedom House's 2003 Survey of Press Freedom, Latvia was ranked in the second-highest group of "Free" media. In a survey made in November 2003 by the SKDS polling firm, 24.2 percent of respondents claimed that the Latvian media were entirely free, 47.3 percent thought they were partly free, and 9.5 percent believed they were not free.

Local Governance (Score: 2.50)

The November 5,2003, European Commission report on Latvia was blunt in its assessment of Latvian reforms at the subnational level: "The administrative-territorial reform, which started in 1998, is advancing at a slow pace." By the end of 2004, the situation had not improved; indeed, reforms may have been reversed as a result of the new "voluntary" approach enunciated by the minority government of Indulis Emsis and the fact that within a period of 28 months four different people headed the ministry in charge of reform. Latvia, with a population of 2.3 million, has over 450 rural municipalities (pagasti), 19 amalgamated municipalities (novadi), 59 towns (pilsetas), and 7 cities. In addition to these primary territorial divisions, there are 26 secondary regional territories called rajoni that encompass all the other units except the 7 major cities. Nevertheless, over a century of existing patterns of local governments has left a certain reluctance to break with tradition. Indeed, many local governments have had a history of mutual competition and even dislike.

The need for reforms rests on the inability of current structures to provide all the services and carry out all the functions that have been assigned to these bodies, functions that are vital for the further development of Latvia. Western-based institutions such as the EU's PHARE program and the World Bank have pushed for changes and financial pilot projects, information gathering, and regional planning over the past decade. Denmark has also been particularly active in this regard. Local governments are responsible for primary and secondary education, most social assistance (except pensions and family care benefits), health care, water supply and sewage works, district roads, solid waste collection and disposal, and about one fifth of all housing in Latvia to which they have legal title.

Financing so many municipalities of such variable size is also a major problem. For over half of their income, municipalities are dependent on personal income taxes. Diena of September 23,2004, reported that in 2005 municipalities would be allowed to keep 73 percent of personal income tax, although they initially lobbied for 75 percent. Another major source of income is real estate taxes, which contribute about 10 percent of total revenues. Another 10 percent comes from the sale of land and property, fines and penalties, and service payments.

Although poorer districts benefit from an equalization fund that redistributes some of the income of more prosperous districts, and also receive central governmental support, there is an increasing divide between the smaller and poorer municipalities and the more prosperous and larger ones. Poorer jurisdictions have to contend with many problems in their administrative structures. They cannot afford high-wage professionals and are forced to hire locals who combine several skills and functions. Over half of the municipalities cannot afford the services of lawyers, leading to a situation where many municipal regulations are contradictory and even run counter to national law.

Smaller municipalities have problems in recruiting candidates for local councils and executive positions. Patterns of nepotism are apparent in some places, with family ties being the key success factor. Corruption control and transparency are often difficult to maintain, especially in the handing out of contracts and the ordering of supplies.

Municipal elections are free and democratic, with a turnout of 60 percent in the 2001 elections. In the larger cities people run as candidates of political parties, but in most rural areas personality politics dominate. Municipalities have created an association to lobby for their interests, the Union of Local and Regional Governments of Latvia, which receives a fair amount of publicity in the local and national media. Recently, the association was successful in forcing the government to drop a clause in the proposed Law on Municipalities that would have allowed the minister of municipal affairs to discharge local councils.

New municipal elections were due to be held on March 15,2005, with a newly expanded electorate, as the voting age has been lowered from 21 to 18. For these elections, each party's campaign spending will be limited to 20 santims (US$0.36) per voter in each district, based on the previous electoral list. However, parties are allowed to pool funds and focus spending on priority races. There were suggestions for a 5 percent electoral barrier for party representation, as in elections to the national legislature, but it appeared that only Riga would implement such a limitation.

Currently, city mayors and district chairpersons are elected by council deputies. Many would like to change that. An October 2004 poll of Riga's citizens published in Latvijas Avize found that 61.8 percent favored direct popular elections of their mayor. The size of district councils varies from 7 members (for districts with under 2,000 residents) to 15 (for those with over 50,000 people). Riga is an exception and is allowed 60 deputies. The Ministry of Justice and Ministry of Regional Development and Local Government set the parameters and monitor subnational government elections and the appropriateness of their legal acts.

In sum, the quality of local government is very variable, as is its capacity and ability to fulfill all required jurisdictional duties. Elections, however, appear to be fair, with a surprisingly large voter turnout. Only citizens of Latvia or the EU are allowed to vote, a practice that is commonly found in many European countries. Voter satisfaction with local governments has varied little between 2002 and 2004, according to polls. An SKDS poll taken in January 2004 showed that 49 percent of respondents were satisfied with their representatives, 26.5 percent were somewhat satisfied, and 12.8 percent were totally dissatisfied.

Judicial Framework and Independence (Score: 1.75)

Latvians are guaranteed equality before the law, but not all have equal access to justice in practice. Over 80 percent of litigants in civil cases act without the help of lawyers. This inevitably skews the results of judgments in favor of wealthier citizens who are able to afford legal counsel. Some legal help is provided by the Latvian Human Rights Bureau. Currently, state legal aid is made available only in criminal cases. According to an EU directive, Latvia was expected to introduce legal aid by the end of 2004. Such aid has been budgeted for 2005 to cover about 25 percent of all litigants who fall below a given poverty line.

Legal reform is a continuous process that began after independence in 1991, but pressure to reform was hastened by Latvia's desire to join the EU. Various EU organizations offered expertise and funding to help Latvia achieve an effective legal structure. A major step away from Soviet traditions came with the introduction of the new criminal code, adopted by the Parliament in May 1998. Another major step came when the administrative code was introduced in February 2004. This code consolidates earlier variants scattered in many laws and regulations and gives individuals a clarification of their rights and of compensation measures from governmental organizations where their rights and laws have been violated.

Prosecutors are independent but have criticized politicians and ministers for pressuring them to investigate particular issues. The chief prosecutor, Janis Maizitis, is considered to be independent. The idea of jury trials has been debated, but as yet no concrete steps have been taken. In October 2004, new probation offices were opened in Riga and Valmiera.

A 2003 Law on Court Executors is expected to resolve one of the most controversial areas of the justice system. Formerly, about 70 percent of court decisions in civil cases were not implemented, and there was great potential for arbitrary actions and corruption. Now, new cadres of about 100 court executors (bailiffs) have been trained for this purpose and have been subordinated directly to the courts. Minimum educational requirements for new recruits have also been raised.

One of the long-standing criticisms of the Latvian judicial system has been the huge proportion of prison inmates awaiting trial or not yet sentenced. In 2004, almost 40 percent of the country's inmates were being held in pretrial detention, according to Diena. This situation is the product of Latvia's seriously overburdened and underfunded court system. An average judge annually disposes of 33 criminal cases but has an accumulated backlog of 66 cases. The worst bottleneck is in Riga courts.

Several steps have been taken to ameliorate this situation. In Riga, a new courthouse with 20 courtrooms was completed in 2003, and two other new courthouses are expected to be in service by the end of 2005 and the end of 2006, respectively. Another new court building is under construction in Jurmala. On February 1,2004, the new administrative court system began its work. Its major responsibilities include the adjudication of disputes and conflicts between the population and national or local public servants, including police agencies. Formerly, such cases were handled by regular courts. By the end of 2004, this new structure employed 35 judges. Regional administrative courts are planned, but not until 2006, so litigants must now either travel to Riga or open and participate in the case by correspondence, one of the innovative advantages of this type of court system.

Other changes are also affecting caseloads and improving the quality of judgments. Public notaries now have the authority to adjudicate conflicts over inheritance and wills, decreasing the number of court cases by several thousand a year. The Ministry of Justice has also added 15 new judges to the Riga regional courts. In May 2004, there were 451 judges in Latvia. The various changes in the court system have had a positive impact on the disposition rate of criminal cases. The procedure for selecting judges has become more stringent; starting in 2004, a candidate for the bench must first pass an examination before being allowed to work as a two-year apprentice judge.

If in the past there were many vacancies, currently there is competition for judicial appointments. The prestige of judges has risen, and so has their remuneration. The justice minister instituted a new schedule of gradual pay raises that will double salaries by 2006. Courts are also being slowly modernized, and computerization is almost complete. Regional court decisions are now being entered into a centralized computer system that is accessible to the public. All courts are expected to participate. If successful, this should have a tremendous impact on the quality of judgments and legal education for the population.

Latvian prisons are overcrowded and in poor condition, but significant progress has been made in upgrading living conditions. A prison board was created in 2003 to ensure correct legal procedures and human rights for prisoners. According to the Apollo Internet news site, Latvia and Estonia have the highest rate of incarceration among the new states of the EU, at 355 prisoners per 100,000 population. In October 2004, Latvia had a prison population of 7,637.

Corruption (Score: 3.50)

The extent of corruption in Latvia has been criticized by many international organizations, foreign investors, and local inhabitants. Transparency International's 2004 Corruption Perceptions Index ranked Latvia 57th out of 146 countries. A 2002 study by the World Bank affiliated Foreign Investment Advisory Service found that Latvian businessmen acknowledged relatively little corruption in the middle and lower levels of public administration. In effect, the attempts to limit such corruption have been successful, but sophisticated wrongdoing such as massive tax avoidance at the highest levels is still problematic. Lower and mid-level corruption is most prevalent in applications for construction permits, customs, municipal police inspections, and the rezoning of property.

The Latvian media are replete with stories of suspected corruption, but few individuals are actually charged or convicted of this crime. A number of international sources have applied pressure to do more, including a panel of representatives of foreign embassies that acts as a consultative body of the corruption-fighting agency KNAB. This panel allows the international community to acquire firsthand information on anticorruption activities and to offer advice and criticism during regular official meetings.

Former U.S. ambassador to Latvia Brian Carlson said in a 2003 speech that not enough was being done to punish those guilty of corruption, leading to the conclusion that "Latvia tolerates corruption and bribery, money laundering, and organized crime." Some officials agreed, including Aivars Latkovskis, chair of the Parliamentary Committee on Corruption, Contraband, and Organized Crime. The European Commission has disapproved of Latvia's slow pace in adapting its anticorruption legislation to EU standards.

Great hope was placed in the KNAB, which began operations in October 2002. By mid-2004, this organization employed 110 people in 16 separate sections. Its greatest accomplishment has been the review of political party financing and ferreting out of illegal donations. Unfortunately, many of its requests to repay the donations to the state have been stopped by the courts, to which the parties can appeal. Therefore the loopholes in existing legislation allowing for such decisions remain unfilled.

Two major problems have hampered the work of the KNAB: leadership finding a suitable head of the agency has proved difficult and inadequate financing. Moreover, it has been locked in bureaucratic fights with other agencies involved in the same area.

The chairman of the Supreme Court, Andris Gulans, was asked in 2004 to discuss the status of the KNAB before a parliamentary commission. He suggested that its leader be chosen by the National Security Council and then ratified by the Parliament. The appointment should last for three rather than five years. Salary levels should not be determined by the cabinet because of potential political pressure. In his view, the KNAB had too many responsibilities and ideally should focus on the elimination of corruption at the highest levels and on setting a broad national strategy for limiting corruption. Other organizations, including the police, can cope with lesser corruption, he suggested. Some parliamentarians added that the KNAB and its duties should be specified in the Constitution.

A half dozen other agencies tasked with fighting corruption continue to operate in spite of the original plan to concentrate these forces into the KNAB. Institutional rivalry and low levels of cooperation have marked the relations among these agencies, and as a result their efforts have been neither inspiring nor tremendously successful, according to some critics.

In spite of the apparently mediocre progress, some changes have been made to anticorruption policies and legislation. Police officers can no longer require traffic violators to sit in the police car, where it is easier to solicit bribes. Police wages have been significantly increased as well. Many safeguards, including cameras, have been installed at customs points. Greater transparency has been achieved in the courts, and judges too are receiving significantly higher pay. The new stricter border controls required by the EU should practically eliminate the trade in contraband oil.

In conclusion, it appears that there is some determination to tackle corruption, but the accumulated bad habits from the Soviet period (where the exchange of favors, or blat, was pervasive) and the semilawless period following independence have presented formidable challenges. In effect, individuals who want to advance their own projects, welfare, and goals are willing to indulge in corruption to save time, energy, and resources. Nevertheless, pressure is coming from different directions, including the EU, for Latvia to grapple seriously with existing corruption problems.

Author

Juris Dreifelds teaches political science at Brock University in Ontario, Canada. He is the author of many chapters and articles on the Baltic area. His book Latvia in Transition was published by Cambridge University Press in 1996.