On the world map, Latvia is located on the east coast of the Baltic Sea at the crossroads of Northern and Eastern Europe. Latvia, a parliamentary republic, is bordered by Estonia to the north, Russia and Belarus to the east, and Lithuania to the south, with a maritime border with Sweden to the west. The total length of Latvia’s coastline is 498 km.
Latvia has almost 2 million inhabitants, of whom almost 1 million live in and around the capital city of Riga, the metropolis of the Baltic region. The second largest city is Daugavpils, with a population of about 82 600.
With its relatively small population, Latvia is not a major market, but the country’s key advantage is its location, which provides access to its immediate neighbours. The population of the three Baltic States totals 6.0 million, approximately equal to the population of Denmark. On its doorstep are the Scandinavian countries, with 25 million people; Russia and the independent CIS states, with a combined population of about 280 million; and Eastern Europe, with about 100 million inhabitants. Latvia stands out for two major criteria eligible for any investor – infrastructure and labour force.
Latvia’s skilled and multilingual labour force, abundant natural resources, and strategic location form a solid foundation for the country’s economy and make Latvia the perfect place to develop your business.
Basic facts about Latvia
| Name of country | Republic of Latvia |
|---|---|
| Country code | LV |
| Size of area | 64,573 km2 |
| Population (at the beginning of 2020) |
1.908 million |
| Capital city | Riga |
| Ethnic composition (beginning of 2019) |
62.3 % Latvians 24.9 % Russians 3.2 % Belarusians 2.2 % Ukrainians 2.0 % Poles 1.2 % Lithuanians 0.3 % Roma 3.9 % other nationalities |
| Language | Latvian (official); Russian, English and German are also widely spoken |
| Political system | Republic, parliamentary democracy |
| Head of state | President (Mr) Egils Levits (elected in 2019 by Parliament for a four-year term) |
| Head of government | Prime Minister (Mr) Arturs Krišjānis Kariņš |
| Political parties in Saeima represented in the 7 fractions of Parliament of Latvia (elected 2018) |
|
| Membership in international organizations | Member of OECD since 2016; Member of NATO since 2004; Member of WTO since 1998; Member of EU since 2004. |
Economic indicators
| GDP (2020) GDP (2019) |
EUR 29.3 billion EUR 30.4 billion |
|---|---|
| Growth of GDP (2020) Growth of GDP (2019) |
-3.6 % 2.0 % |
| GDP per capita (2020) GDP per capita (2019) |
EUR 15 431 EUR 15 901 |
| Private Consumption (percentage of GDP, 2020) |
55.0 % |
| Public Consumption (percentage of GDP, 2020) | 20.3 % |
| Capital Account Balance (2020) | EUR 511 million |
| Gross Fixed Capital Formation (percentage of GDP, 2020) |
23.4 % |
| Growth of Industrial Production (as % of previous period, calendar adjusted data, 2020) |
-1.7 % |
| Government Revenue (percentage of GDP, 2019) | 37.82 % |
| Government Expenditure (percentage of GDP, 2019) | 38.40 % |
| Inflation rate (2020) | 0.2 % |
| Rate of Wage Growth (2020) | 5.9 % |
| Unemployment Rate (2020) | 8.1 % |
| Fiscal Balance (percentage of GDP) (2019) | -0.57 % |
| Current Account (2019) | EUR -174 million |
| Exports of goods and services (2020) | EUR 17.68 billion |
| Imports of goods and services (2020) | EUR 17.34 billion |
| Accumulated FDI (2020) | EUR 16.7 billion |
| Accumulated FDI per capita (2020) | EUR 8 739 |
| General Government Debt (2019) | EUR 11.2 billion |
| Currency | Euro (EUR) |
| Credit Ratings (as at March 2021) | |
| Fitch Ratings Moody’s Standard & Poor’s R&I |
A- (Outlook: Stable) A3 (Outlook: Stable) A+ (Outlook: Stable) A (Outlook: Stable) |
Additional information
Central Statistical Bureau of Latvia: www.csb.gov.lv/en
Central Bank of Latvia: www.bank.lv/en
Latvian Institute: www.li.lv/en
www.fitchratings.com
www.moodys.com
www.standardandpoors.com
www.r-i.co.jp