Morten Hansen, Head of Economics Department from the Stockholm School of Economics in Riga gave an extremely informative presentation entitled Around the Latvian Economy in 80 Minutes and 80 Slides. He is from Denmark but has lived in Latvia for 30 years.
Latvia is the size of West Virginia, has the population of Nebraska, and is at the same latitude as Alaska. The one thing that this small country can boast about: they have the world’s tallest women!! I think that they must excel in volleyball.
The Baltics don’t like to be lumped together. Additionally they can’t agree on much.
Before independence from the Soviet Union, people were appointed to a job and could stay in that job for a lifetime. You didn’t need much money because there wasn’t much to buy. The Soviets assumed that people didn’t need cars because they could walk. It took 7+ years to get a car. Three auto brands were available, all made in the USSR. Young people married early, after school. There was a high rate of divorce. People would start planning a family after age 30 after getting established in a career. You would live an aimless life because you had to follow all of the rules.
Latvia regained their independence in 1991. Since that time they have lost one quarter of their population. Some Russian-speaking people went back to Russia. Some Latvians emigrated to western European countries like the U.K. that have higher salaries. Declining population is their most serious problem as it affects the labor market. Latvia welcomes Artificial Intelligence (AI) as they expect more labor decline in their future.
Latvia wants to be part of western Europe. A step toward the West is a step away from the East. They have been very proactive by adopting western policies such as joining the EU, NATO, etc. as quickly as possible. (Ukraine was forced to take a slower path because of their exit agreement with the USSR and questions about whether they would be east or west focused. Now they seem to be paying for it.)
The Russian language is going out. It is spoken by the older Latvians. English is in and is spoken by the young.
It wasn’t always rosy. VEF was a plant located in Riga that manufactured radios and telephones for the entire Soviet Union. There were 35,000 employees. At independence in 1991 the products from the west were in and the east was out. One third of economic activity disappeared. Unemployment, inflation, etc. were difficult and many people left Latvia for better opportunities.
The Soviets didn’t take proper care of buildings during their 50 years of oppression. After independence the Latvian government gave land and buildings back to pre-1940 owners who applied.
Professor Hansen said that he had a modest salary during his early days in Latvia after their independence. It was plenty to live on, and he saved money because there was nothing to buy at that time.
Sixty-three percent of the country are ethnic Latvians. Twenty-five percent are ethnic Russians. (These were workers sent to work in Latvia during the Soviet Occupation after WWII.) Russian was the official language. There wasn’t much intermarrying because their cultures are vastly different from each other.
Most Russians living in Latvia are pro-Ukraine. Once the invasion of Ukraine occurred, all Soviet monuments numbering around 70 were taken down. Some said no as it is part of history; others said yes it was about time. Mandatory army service will resume in Latvia in 2024 . There will be a lottery to determine the order of drafting.
Riga is a port city with lots of warehouses. It is the biggest and oldest city in Latvia. It has a canal that had been converted from a moat that surrounded the city. Our guide said that Riga had a lot in common with Venice. She spoke excellent English but her pronunciation was a little off. For example, Venice rhymed with Denise and squeals were squirrels.
The Soviets did not raze the wooden houses or the Art Nouveau houses after WWII. In the old town area where bombing occurred during WWII, the Latvians have chosen to clear and build as opposed to investing in renovation.
The Organ at Dome Church is the second largest in Latvia. It has 4 rows of keys and 6,718 pipes. A young lady was a page turner and registrant who pulled out stops for the organist in order to produce a particular sound.