Latvian Economy
Economy - overview: Latvia is a small, open economy with exports contributing nearly a third of GDP. Due to its geographical location, transit services are highly-developed, along with timber and wood-processing, agriculture and food products, and manufacturing of machinery and electronics industries. Corruption continues to be an impediment to attracting foreign direct investment and Latvia's low birth rate and decreasing population are major challenges to its long-term economic vitality. Latvia's economy experienced GDP growth of more than 10% per year during 2006-07, but entered a severe recession in 2008 as a result of an unsustainable current account deficit and large debt exposure amid the softening world economy. Triggered by the collapse of the second largest bank, GDP plunged 18% in 2009. The economy has not returned to pre-crisis levels despite strong growth, especially in the export sector in 2011-14. The IMF, EU, and other international donors provided substantial financial assistance to Latvia as part of an agreement to defend the currency's peg to the euro in exchange for the government's commitment to stringent austerity measures. The IMF/EU program successfully concluded in December 2011. The majority of companies, banks, and real estate have been privatized, although the state still holds sizable stakes in a few large enterprises, including 99.8% ownership of the Latvian national airline. Latvia officially joined the World Trade Organization in February 1999 and the EU in May 2004. Latvia joined the euro zone in 2014.
GDP (purchasing power parity): $48.19 billion (2014 est.)
GDP (official exchange rate): $31.97 billion (2014 est.)
GDP - real growth rate: 2.4% (2014 est.)
GDP - per capita (PPP): $23,700 (2014 est.)
GDP - composition by sector: agriculture: 4.8%
industry: 24.8%
services: 70.4% (2014 est.)
Labor force: 1.014 million (2014 est.)
Labor force - by occupation: agriculture: 8.8%
industry: 24%
services: 67.2% (2010 est.)
Unemployment rate: 10.8% (2014 est.)
Household income or consumption by percentage share: lowest 10%: 2.7%
highest 10%: 27.4% (2008)
Investment (gross fixed): 26.2% of GDP (2009 est.)
Budget: revenues: $11.96 billion
expenditures: $11.97 billion (2014 est.)
Public debt: 36.5% of GDP (2014 est.)
Inflation rate (consumer prices): 0.7% (2014 est.)
Central bank discount rate: 3.5% (31 December 2011)
Commercial bank prime lending rate: 6% (31 December 2014 est.)
Agriculture - products: grain, sugar beets, potatoes, vegetables; beef, pork, milk, eggs; fish
Industries: buses, vans, street and railroad cars; synthetic fibers, agricultural machinery, fertilizers, washing machines, radios, electronics, pharmaceuticals, processed foods, textiles; note - dependent on imports for energy and raw materials
Industrial production growth rate: 1.5% (2014 est.)
Electricity - production: 6.008 billion kWh (2012 est.)
Electricity - consumption: 7.141 billion kWh (2012 est.)
Electricity - exports: 3.65 billion kWh (2013 est.)
Electricity - imports: 5.005 billion kWh (2013 est.)
Oil - production: 0 bbl/day (2014 est.)
Oil - consumption: 39,000 bbl/day (2008 est.)
Oil - exports: 117.9 bbl/day (2012 est.)
Oil - imports: 140 bbl/day (2012 est.)
Oil - proved reserves: 0 bbl (1 January 2015 est.)
Natural gas - production: 0 cu m (2013 est.)
Natural gas - consumption: 1.41 billion cu m (2013 est.)
Natural gas - exports: 0 cu m (2013 est.)
Natural gas - imports: 1.41 billion cu m (2013 est.)
Current account balance: -$996 million (2014 est.)
Exports: $13.38 billion (2014 est.)
Exports - commodities: wood and wood products, machinery and equipment, metals, textiles, foodstuffs
Exports - partners: Lithuania 17.7%, Russia 14.7%, Estonia 11.2%, Germany 6.6%, Poland 6.2%, Sweden 5.1%, UK 4.7% (2014)
Imports: $16.56 billion (2014 est.)
Imports - commodities: machinery and equipment, chemicals, fuels, vehicles
Imports - partners: Lithuania 17%, Germany 11.7%, Poland 10.9%, Russia 7.7%, Estonia 7.7%, Finland 5.8%, Italy 4.1% (2014)
Reserves of foreign exchange and gold: $7.507 billion (31 December 2014 est.)
Debt - external: $40.5 billion (31 December 2014 est.)
Stock of direct foreign investment - at home: $17.92 billion (31 December 2014 est.)
Stock of direct foreign investment - abroad: $2.731 billion (31 December 2014 est.)
Exchange rates: lati (LVL) per US dollar - 0.7489 (2014 est.), 0.7634 (2013 est.), 0.55 (2012 est.), 0.5012 (2011 est.), 0.5305 (2010 est.)
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Update: This page was last updated on 10 November 2015
Sources: 1. CIA, The World Factbook, https://www.cia.gov/library/publications/the-world-factbook/geos/ae.html
2. DIBNC Experts Team