Latvia History and Economy

History and Politics

Early history

First people settled around 12,000 BC. In the area that is today Latvia. Different cultures developed. From around 4000 BC, hunters and gatherers became Settled farmers.

Finngric tribes like the Livs migrated in the 3rd millennium BC. BC from the north and northeast into the area. They merged with the Balts, who settled here from the 2nd millennium. These Baltic tribes were for example Kur, Semgall, Selonen and Latgall. They are the ancestors of the Latvians.

The German Order

Many small principalities were formed in the early Middle Ages. They were conquered by knights of the Teutonic Order after 1237. They founded the Teutonic Order State here. Poland had asked for help against the Prussians and promised land to the knights of the order.

This land has now been settled and the people converted to Christianity. Economically there was a boom. The upper class (Baltic Germans) who immigrated from Germany had a great influence on culture and language and formed the nobility.

At the end of the 14th century, however, the Teutonic Order came under the influence of the Grand Duchy of Lithuania and Poland, which came together in 1385 and rose to become the most powerful empire in the Baltic region.

16th to 18th century

The Reformation was also carried out in Latvia and so the area became Protestant. In 1560 the monastic state came to an end when the secular duchies of Livonia and Courland submitted to the feudal sovereignty of Poland.

Russia, Sweden and Poland tried again and again to gain influence in the Baltic States. Wars and epidemics caused the population to shrink. Livonia was conquered by Sweden in 1629, and Courland became Polish. In 1710 the area came to Russia in the Great Northern War.

First independence (1918-1940)

In 1917 the tsarist rule in Russia ended and the Bolsheviks took over. That should also happen in Latvia, but Latvia liberated itself from Russian rule in the Latvian War of Independence from 1918 to 1920 and declared a republic. From 1936, after a coup d’état, Latvia was dictatorially ruled by Kārlis Ulmanis. In the Hitler-Stalin Pact in 1939, Germany and Russia divided Eastern Europe among themselves. Latvia remained independent until 1940, when the Soviet Union occupied Latvia.

Latvian Soviet Socialist Republic

With the occupation by the Soviet Union, the Latvian Soviet Socialist Republic was founded in 1940. In 1941 Latvia was occupied by Germany. At the end of the Second World War, Latvia was reoccupied by the Soviet Union in 1945. Latvia remained part of the Soviet Union until 1990. The Latvian language and culture was strongly suppressed during this period (Russification). If many Latvians were deported (kidnapped) as early as 1941, this continued until Stalin’s death. In addition, a settlement policy was pursued through which many Russians came to Latvia.

Independence 1990

On August 21, 1991, Latvia regained its independence with the collapse of the Soviet Union. This had already been declared in May 1990 during the Singing Revolution. Singing their own folk songs or national anthems had been forbidden for the Balts in the Soviet Union – now they showed their desire for independence by singing.

The first years of independence were difficult economically, but then there was great economic growth. The crisis came in 2007, from which Latvia is now recovering. For the Russians, some of whom have lived in the country for decades, independence means that their citizenship in Latvia has not been recognized. To this day, many Russians are stateless.

As a country located in Europe detailed by hyperrestaurant, Latvia joined the European Union in 2004 and the euro area in 2014. So you pay there with the euro. Egils Levits has been President of Latvia since 2019.

Latvia History


The economic situation in Latvia

With the separation from the Soviet Union and independence in 1991, the economy of Latvia initially collapsed. The conversion from a planned economy to a market economy then led to particularly strong economic growth from 2000 onwards.

With the global financial crisis there was another slump in 2007. Unemployment was at times at 21 percent. The economy has been slowly recovering since 2011. In 2016 there were still 9.6 percent unemployed. Almost all companies are now privately owned and no longer state owned.

Wood, metals, textiles

Export, i.e. sales to other countries, plays an important role in Latvia’s economy. Wood and wood products make up a third of this. Metals make up 14 percent and textiles 11 percent.

Latvia is lucky to be in an economically favorable location in Europe. With Riga, Ventspils and Liepaja there are three important ports on the Baltic Sea coast, where, for example, Russian oil and coal are loaded.

Little agriculture, a lot of industry

Agriculture only accounts for 3.2 percent of total economic output, while industry contributes just under 22 percent. Grain, rapeseed, potatoes and vegetables are grown. The main livestock are pigs and chickens.

There are factories in particular for machines and vehicles, food, metal, textiles, wood and fertilizer.

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