Latvia. For the fourth election in a row, a newly formed
party became the largest in the Latvian parliament. New
times, led by former central bank governor Einars Repse,
received strong support during this year's election campaign
for its campaign against widespread corruption. Repse forced
the party's candidates to take oaths that they were free
from foam deals. New times also advocated a liberal economic
policy with tax cuts, while the party left the left on
social issues and the right with a nationalist flavor.
Just before the election, the tripartite government was
thrown into an open conflict between Prime Minister Andris
Berzin's Liberal Center Party Latvia and the Conservative
coalition partner Folk Party. Police arrested two leading
members of the Latvian Road and accused them of distributing
election leaflets that blamed popular party candidates.
Prime Minister Berzins claimed that it was all a plot
against Latvia's path led by the People's Party of the
Interior, which was therefore dismissed.
Countryaah website, the disintegrating coalition lost big in the elections.
Latvia's road did not reach up to 5% of the vote and thus
fell out of Parliament. New times became the winner of the
elections and took 26 of the 100 seats. In second place with
24 seats came the Left Alliance for Human Rights in a united
Latvia, which mainly represents the Russian-speaking
minority. The People's Party received 21 seats, the League
of Green and Agrarian 12, Christian Party Latvia's first
party 10 and the right-wing nationalist Fosterland and
freedom 7 seats.
Einars Repse formed a coalition government with New
Times, the League of Green and Agrarian, Latvia's first
party and Fosterland and freedom. The Road of Latvia and the
People's Party, which has long dominated the country's
politics, were thus placed without influence.
The first task of the new government was to complete
preparations for NATO and EU membership. At the NATO summit
in Prague in November, Latvia was invited as a new member of the
military alliance in 2004, together with Estonia and
Lithuania. Einars Repse stated that NATO membership would
guarantee Latvia independence "forever". Earlier in the year,
the Latvian Parliament had met NATO's demand for milder
language laws for the Russian minority. The condition of
knowledge of Latvian for candidates in political elections
had been abolished. In this way, NATO wanted to soften up
the Russian resistance to Latvian NATO membership.
Latvia's negotiations with the EU were finalized in the autumn
and at the EU summit in Copenhagen in December, Latvia, Estonia,
Lithuania and seven other countries were accepted as new
members of the Union as of 2004. But first, EU membership
must be approved in a referendum, which for Latvia's part is
implemented in 2003.
Strong macroeconomic growth continued during the year,
while the gaps between the city and the countryside were
evident. In eastern Latvia the unemployment rate was high and in
rural areas further deterioration and closed farms were
feared when Latvian agriculture is to be included in EU
agricultural policy and must compete in the same market as
the rest of Europe but with less support.