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Transit and Logistics

Trade with Latvia / Industry Profiles / Transit and Logistics

Historically, Latvia has been one of the main transit points for both north-south and east-west trade flows. Its geographical location remains central to strategically relevant transportation flows connecting major world economies like the USA, European Union, Russia, the CIS and the Far East. The transit sector is one of the strongest industrial sectors in Latvia. This has been recognised by the government which has named transit as a key priority within the Latvian economy. Nearly 90% of turnover in Latvian ports, 75% of rail cargo, and the major proportion of oil and oil products transported via trunk pipeline systems is transit. More than 9% of Latvia's employees are engaged in the transportation and servicing of transit cargo. The importance of the transport, transit and storage sector in terms of GDP contribution is substantial at around 11%.

Integration in the overall European transportation system is in progress, thus meeting the needs of the national economy for high-quality freight-transport services, as well as increasing the number of options and flexibility in the carriage of both passengers and cargo.

Latvia recognises the development of an effective, secure, multi-modal, balanced, environmentally-friendly and competitive transport system to be a priority. The main goal for the sustainable development of Latvia’s transport system is to fully integrate Latvia’s transport infrastructure with the Trans-European multi-modal transport system. Special attention is being paid to developing coastal shipping and combined transportation. Promotion of ferry traffic in the Baltic Sea is being, and will be emphasised further by involving Latvia’s port authorities. A key priority is to construct and develop industrial, logistics and distribution parks. In developing the transport and energy infrastructure of the European Union, essential conditions are: the effective use of the transport and energy network; the planning of development from an economic point of view, taking into account established goods and passenger transport corridors; and the development potential of economic relations between the European Union and neighbouring countries.


Total Volumes of Cargo Transportation (million ton-km)

Source: Central Statistical Bureau of Latvia, 2009

Railways link Latvia with Russia, CIS, the neighboring Baltic States, and through Poland with the rest of Europe. Latvia possesses a dense railroad network connecting the country to destinations as far as the Russian Far East, wherever the former Soviet railway gauge standard is in operation. There are additional opportunities for trade connection with Japan and Southeast Asia. Currently state-owned operator Latvian Railways functions mostly as a transit trunk-line with as much as 75% of total freight volumes being transit connected to Latvian ports and 24% of freight rolling-stock being tanker wagons. Movement in the opposite direction, to Moscow and other parts of Russia and CIS countries, is dominated by container cargo. There is enough capacity to substantially increase the cargo currently transported by rail. At present, the east-west railway corridor has the capacity to transport 50 million tonnes of cargo annually and reconstruction plans to substantially increase this figure have been approved.

Latvia has three major ice-free ports - Ventspils, Riga, and Liepaja and seven minor ports – Salacgriva, Lielupe, Engure, Mersrags, Roja, Kolka and Pavilosta. The three major ports have been accorded favourable incentive schemes to help attract new business (80-100% relief on direct taxes and significant discounts on indirect taxes (VAT, Excise)). Ventspils and Riga Ports are Free Ports whereas the entire city and port of Liepaja comprise a Special Economic Zone.

The Latvian road network is well-developed but further development is still in progress. The government instigated policies to promote a high quality road infrastructure and road safety standards that will meet internationally approved requirements. The Via Baltica is the most important transport corridor, traversing Latvia in a north-south direction. Via Baltica is also an European transport corridor - route E67. It connects European cities Helsinki, Tallinn, Riga, Kaunas and Warsaw, and Riga, Kaliningrad and Gdansk. The road network is uniform throughout Latvia. It is easy to reach any place by road transport whatever its location. There is almost no traffic congestion except during some morning and evening hours in Riga. This is a great advantage for transit flow and allows driving without interruption. Furthermore, there are no tolls, fees or taxes for using roads, bridges or tunnels.

The Latvian government has put a lot of effort into the modernisation of Riga International Airport, which is the largest air transport centre in the Baltic States. Almost 4.1 million passengers utilised Riga International Airport in 2009, growing by 10% comparing to 2008. There are regular direct flights from Riga International Airport to 74 cities. Among the airlines operating daily flights are Air Baltic, Aeroflot, Aerosvit, Belavia, Bulgaria Air, City Airline, Czech Airlines, Finnair, SmartLynx – Latcharter, LOT Polish Airlines, Lufthansa, Norwegian Air Shuttle, Ryanair, Tarom Romanian Air Transport, Turkish Airlines, Uzbekistan Airways, Wind Jet and Wizz Air. Cargo services are provided by a number of airlines such as European Air Transport N.V., Sprint Air Sp, Transaviabaltika. International courier services are available, including DHL and UPS.

Sector Advantages

  • Latvia's geographical location between east and west, forming the EU's external border with Russia and Belarus, particularly significant for the Russian market, but also important because of the potential transit function of Far East cargo via the Trans-Siberian Railway connection to western Europe. The strategic location of the capital Riga, including its own consumer market potential, offers opportunities for development within the Baltic States and is the reason that numerous international companies have located their Baltic States' head offices there.
  • The quality and level of transport and logistics services is improving, led by large, international transport and forwarding companies, which have the ability and expertise to organise value-adding activities.
  • Quality of road, rail, and maritime infrastructure – the transport connections for maritime cargo flows in containers, good quality of railway and road transport.
  • Availability of skilled labour – larger companies provide training for their staff. Many employees have knowledge of three foreign languages (mostly English, Russian, German)
  • Availability of high level IT in the transport industry, with use of modern IT/data systems, Internet connections, and the development of Electronic Data Interchange. The development of technology is being stimulated by the large, international transport and forwarding companies.
  • Government support for the development of the transit, transport and logistics sector is satisfactory, customs and tax legislation has been considerably improved in recent years, so both customs and tax authorities now have good communications and information systems.

Additional Information
© LIAA , SIA Interaktīvo Tehnoloģiju Grupa 2006 Last updates: 21.05.2012