Latvians seek to escape centuries of occupation by joining the Union

Date: 10/10/1996

THE Latvians are a nervous people. With a national consciousness scarred by centuries of occupation, the country's latest period of independence marks an exception rather than the rule.

Successive waves of Teutonic invaders, Nordic conquerors and Russian oppressors have not set a favourable precedent for the small Baltic state's long-term future. Perhaps more than any other factor, it is those memories which provide the driving force for everything the country does.

When Latvia applied for EU membership exactly a year ago, one motive overshadowed all others - security.

Five years after the collapse of the Soviet Union, Russia still poses as great a threat to the Latvian psyche as ever. Its people regard recent events in Chechnya as evidence that the Russian bear, although wounded, still bites.

Union membership is seen by Latvians as an essential step on the road to joining NATO, and both rank equally high among national policy aims.

“We have completely excluded any idea of neutrality,” said Latvia's EU ambassador Juris Kanels. “It does not work. History proves it.”

Yet NATO is proving decidedly wary of extending its membership to the Baltic states. Anxious not to alienate post-transition Russia, many western leaders feel that expansion to its very edges would be considered a provocative move.

Furthermore, Russo-Baltic relations are tender at best, characterised by citizenship battles and border disputes.

All this is a far cry from the calm prosperity of the Hanseatic League, the 14th century Baltic trading group to which Latvians still hark back.

Latvia, or Livonia as the region was once known, has a long record of commercial vigour and was heavily involved in free trade while western Europe was still pulling itself out of the Dark Ages.

But now, six centuries later, Riga's overwrought administration is battling to boost a struggling economy and combat wide-scale poverty.

The implications of this are not lost on Foreign Affairs Minister Valdis Biravs, who said recently: “In two or three years time, we shall be studied as if under a microscope, and then they will say: 'Dear fellows, you want to enter the EU, but look at yourselves! You do not do anything, you do not understand anything!' Unfortunately, I do not see any strong will (except in a few rare cases) to reform the country on its way to the EU.”

Aware of the growing criticism, Latvia's new government, which came to power this year, has already made some decisive moves.

Prime Minister Andris Skele has actively pursued a non-deficit budget since his election, with some success. Increased excise duties on items such as alcohol and a clamp-down on tax evasion are paying dividends. Public expenditure has been cut, markets opened up to investors and a major privatisation programme is in place.

Latvians are anxious to tell investors about their enormous ice-free ports, replete with oil terminals and oil products installations. They want to advertise vast underground gas storage facilities with enough capacity to supply all the Baltic states, Russia and Belarus. And they are shouting from the rooftops about their paper mills, which are currently lying unused while the country has extensive swathes of forests.

But they may have to shout considerably louder and longer if the world is to take any notice.

Latvia does not have the lure of the giant markets of Poland, or the sophistication of the Hungarians. Consequently, direct foreign investment has reached nowhere near the desired level.

On the one hand, the country is still suffering from the aftershocks of a severe banking crisis during 1995. Although the banking sector itself has largely settled down, consumer spending is still low and gross domestic product growth sluggish at 1-1.5&percent;.

What growth exists is largely due to transport and communications and not to industrial output, which continues to flag.

In addition, despite Skele's commitment to privatisation, he is presiding over a fractious coalition hampered by rampant organised crime.

“Generally speaking, developments have been positive, but what we have seen concretely this year is not a great deal,” said Adam Slater of Nimura Research in Vienna.

Latvia also suffers from a severe image problem amongst its liberal neighbours - a quarter of its population has not been granted citizenship and cannot vote in national elections.

Under Soviet rule, vast numbers of Russians were relocated to Latvia to staff its factories and run its army. Following independence, the Latvian government made a pointed effort to remind them of their foreign origin and refused to grant them passports unless they passed stringent tests.

As a consequence, close to 30&percent; of ethnic Russians living in Latvia think they would be better off were they still within the Soviet Union - a view which is shared by less than 10&percent; of the rest of the population.

Russia and western human rights organisations are openly critical of the situation. But Kanels claims the poor image the country has earned for its handling of ethnic problems is based on a deep misunderstanding of the issue.

He points out that 200,000 ethnic Russians lived in Latvia before World War II and were automatically given citizenship upon independence. Another 50,000 have opted for Russian citizenship and come under the protective umbrella of Moscow.

It is only a third group - ethnic Russians with no citizenship at all - who, Kanel argues, are causing a problem, although he acknowledges that they make up a quarter of the population.

Since the summer of 1994, he points out, there has been a marked rise in citizenship applications and the situation is improving rapidly.

As with most disputes, perhaps the only solution is time. But in the meantime, Latvia continues to get a bad press - and is anxious to put that right.

“I do not want Latvia on the front page of newspapers, since nothing good is being written about it. I prefer to notice brief news on Latvia on the third or the fourth page, like a large German company has come to Latvia,” says Foreign Minister Biravs.

“However, I would very much like to see one sentence on the front pages of the newspapers of the world: 'Latvia is admitted to the European Union'. Then I could not only sleep peacefully, but die in peace.”

EU enthusiasts continue to cite membership as a panacea for all Latvian woes. While the Union's popularity may be dwindling amongst other applicants and existing members, to most Latvians it still flows with milk and honey.

The Saeima, the Latvian parliament, supported the country's EU application unanimously a year ago. Opposition to EU membership in some quarters is growing, but only at a very slow rate.

While Latvia's farmers have of late shown some concern at the possible impact of being absorbed into the Union's Common Agricultural Policy, critics are few and far between.

But is this enthusiasm well-founded? Although it was the first Baltic state to apply for EU membership, Latvia is not a top contender for the first round of Union enlargement eastwards.

In the meantime, the country will have to learn to stand on its own two feet, without the intervention of any great powers.

Latvians have not had much practice at independence and perhaps a period of complete self-reliance might be good for the young nation.

But it will be tough. Latvian administrators may well have a good few more sleepless nights before they feel entirely confident in their new role in the world.