[FPN] No. 71/72, 22 June - 3 July 2009

06.07.2009. 15:48

LATVIA TODAY: FOREIGN POLICY NEWS

22 June - 3 July 2009

No. 71/72


HEADLINES

Highlights      

Foreign Minister Maris Riekstins and Georgian Foreign Minister sign Protocol on strengthening co-operation between foreign ministries

U.S. Senator George V. Voinovich on a visit to Latvia

Latvia and Hungary share similar experience in overcoming their crisis

Maris Riekstins: European security dialogue should promote trust between countries

In brief

Third meeting of Latvia-Russia Intergovernmental Commission to be held on 29 July in Riga

The President Appoints the New Ambassadors of Latvia to Finland and Denmark

HIGHLIGHTS

Foreign Minister Maris Riekstins and Georgian Foreign Minister sign Protocol on strengthening co-operation between foreign ministries 

On 2 July, Foreign Minister Maris Riekstins met with the Foreign Minister of Georgia, Grigol Vashadze who was on an official visit to Latvia.  During the meeting, Foreign Ministers of Latvia and Georgia reviewed the current issues of bilateral co-operation, topicalities of the EU-Georgia and NATO-Georgia co-operation, the security situation in Georgia's separatist regions, Abkhazia and South Ossetia, including the results of the current round of the Geneva talks concluded on 1 July, as well as other important bilateral and international topics.

When discussing the bilateral co-operation between Latvia and Georgia, Minister Riekstins rated highly the dynamics of the relations between the two countries which has increased in intensity over the recent years as well as emphasized Georgia's special place in the foreign policy of Latvia. "The relations between Latvia and Georgia enjoy a favourable climate, and an example to this is the Protocol on Cooperation between the Ministry of Foreign Affairs of the Republic of Latvia and the Ministry of Foreign Affairs of Georgia, signed today, which is to enhance co-operation between the foreign affairs sectors," Mr Riekstins noted.  

In the discussion, a special focus was placed on the topical European Union-Georgia and NATO-Georgia agendas. In the EU context, Foreign Minister Riekstins invited Georgia to take the most advantage of the opportunities provided by the Eastern Partnership and offered an active assistance on the part of Latvia in this process. Thereupon, the ministers agreed on the necessity to organise this autumn the political consultations between the Foreign Ministries of both countries.

During the discussion on the current security situation in Georgia and in the region as a whole, both Foreign Ministers shared the opinion on the negative implications of the non-extension of the mandates for the United Nations Observer Mission (UNOMIG) and the OSCE mission in Georgia and acknowledged the significance of the EU Monitoring Mission (EUMM) for normalising the security situation and for a peaceful resolution of the Georgian conflicts. Regarding this, Foreign Minister Riekstins reiterated his discontent about the fact that commitments on which an agreement was made last autumn are still not fully observed. The Georgian Foreign Minister, Grigol Vashadze, expressed gratitude for Latvia's strong support to date on these issues of importance for Georgia, especially during the Russia-Georgia military conflict.

This is already a second official visit to Latvia by a Georgian Foreign Minister within less than a year. The previous visit took place on July 11 last year, when Latvia welcomed the then Foreign Minister of Georgia, Eka Tkeshelashvili.

On 3 July 2009 President Valdis Zatlers received the Minister of Foreign Affairs of Georgia, Grigol Vashadze, as part of the minister's official visit. 

During the meeting the President acknowledged the particularly intense development of Latvia - Georgia bilateral relations in the recent years, marked by active contacts between the senior public officials, an exchange of visits at different levels and meetings within international fora. The two countries are also actively co-operating at the level of institutions in different sectors, local authorities and NGOs. Co-operation is especially active in the fields of defence, culture, education and health care, as well as between border guard services and Central Election Commissions.

In the course of the meeting, the President asserted Latvia's commitment to continue providing support to Georgia in its EU and NATO aspirations. The President and Mr Grigol Vashadze discussed also the impact of the global economic recession on the two countries and the positive role of the EU observers' mission in the stabilization of situation after the armed conflict last August. The two officials agreed on the need to increase the number of observers.

On July 2, Valdis Dombrovskis, Prime Minister of the Republic of Latvia, held a meeting with Grigol Vashadze, Minister of Foreign Affairs of Georgia, during his official visit to Latvia, in order to discuss bilateral relations of both countries and international issues.

Regarding bilateral relations, both officials discussed the visit of the Georgian Prime Minister to Latvia planned in September this year and shared the view that it is necessary to organise the first meeting of the Inter-governmental Commission on Economic, Industrial, Scientific and Technical Cooperation and a business forum of Latvian and Georgian companies.

Grigol Vashadze informed that Georgia has set a goal to sign a European Union Association Agreement covering a Free Trade Agreement and the simplification of the visa regime. In view of the upcoming fundamental reforms to be undertaken by Georgia, the country would be interested in receiving technical expertise from the Latvian side in the veterinary sector, and in the field of food safety and sanitary standards. Valdis Dombrovskis offered cooperation with the Latvian experts. The sides agreed on further consultations among the relevant institutions.

During the meeting, the officials exchanged views concerning the economic situation in both countries. Valdis Dombrovskis informed about the decisions adopted by his Government and the respective budget cuts aimed at overcoming the economic crisis. The Georgian representative described local economic developments in Georgia indicating a recession to the amount of 2% of GDP this year. One of the current issues in Georgia is the high level of unemployment, in particular among highly skilled specialists, and a considerable decrease in the amount of direct foreign investment.

Grigol Vashadze informed about the situation in Abkhazia and South Ossetia. The Georgian Foreign Minister expressed gratitude for Latvia's support to Georgia and Latvia's involvement in the EU monitoring mission in Georgia which is essential for Georgia's security. In order to encourage multilateral cooperation with Georgia, Valdis Dombrovskis expressed his support to new projects under the EU Eastern Partnership.

The Latvian Prime Minister inquired about the domestic situation in Georgia. Grigol Vashadze informed that the situation has become more stable and that the Government is planning a number of reforms, including the funding of political parties from the state budget.  

Press conference of Foreign Minister Maris Riekstins and Foreign Minister of Georgia Grigol Vashadze, 2 July 2009 Audio file (in English) 2.69 MB

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MFA, 2 July 2009

President's Chancery, 3 July 2009

The Cabinet of Ministers, 3 July 2009 

U.S. Senator George V. Voinovich on a visit to Latvia 

On 30 June, a Republican Senator George V. Voinovich from the United States was in Latvia on a working visit. During his visit, the senator met with the Speaker of the Saeima, Gundars Daudze to discuss the Latvia-U.S. relations, the transit of the U.S. goods to Afghanistan via Latvia, as well as the security policy and enegry issues.

The Saeima Speaker expressed gratitude to Mr Voinovich for support to Latvia in its course towards NATO. Mr Daudzer also spoke highly of the Senator's personal contribution to the introduction of the U.S. Visa Waiver Programme.

The Senators commended the participation by Latvian soldiers in the NATO-led mission in Afghanistan. "Latvia is our trusted ally. We appreciate this, especially at the time when Latvia has to take difficult decisions for the stabilization of its economy," said Senator Voinovich.

When reviewing the role of NATO on the gobal arena, Senator Voinovich indicated that the course of the Southern Balkan countries towards membership in the North Atlantic Alliance also needs to be facilitated as this would foster the development of those countries in line with democratic standarts.

The senator also lingered in his memories about the time, when Latvia was still occupied, and part of the U.S.S.R. Believing that everything is bound to change and Latvia will regain its freedom, George Vinovich, the then mayor of Cleveland, together with people sharing the same views, took part in events supporting the independence of Latvia, and, as a tradition, the flag of Latvia was flown at the town hall on 18 November.

In appreciation of his contribution to the promotion of Latvia's foreign policy interests and to the introduction of the Visa Waiver Programme with the U.S., George V. Voinovich was awarded the Order of the Three Stars on 15 May 2009.

Latvia's President Valdis Zatlers said, in a meeting with Senator George V. Voinovich, that it was a matter of honour for him to meet the senator for the third time, adding that Senator Voinovich was a true friend of Latvia and the Baltic states.

The two officials discussed the results of the President's recent visit to the United States. President Zatlers thanked the senator for his initiative in proposing amendments to the American Secure Travel and Counterterrorism Partnership Act which helped Latvia and seven other countries to join the U.S. Visa Waiver Program on November 17, 2008. The specific criteria in the law created a new dimension in this regard, activating bilateral and EU-level contacts with Washington with respect to the Visa Waiver Program. 

President Zatlers and Senator Voinovich also discussed further development of the Baltic region and the Baltic Sea region, focusing in particular on energy security and the energy market in Europe. They also talked about the international peacekeeping mission in Afghanistan, where Latvian and American troops are working together. The President said: "As you know, we sent a second unit to Afghanistan last week, and American and Latvian soldiers are serving together in one unit."

President Zatlers and Senator Voinovich also discussed the economic situation in Latvia, the United States and in the world. Senator Voinovich: "We understand that the situation in Latvia is very tough right now and that very important decisions have been taken. I think that it is very good that the country has taken this step and received this support from the European Union and the International Monetary Fund. The people of Latvia are carrying a great sacrifice at this time, but obviously that had to be done to balance the budget. I think that the rules will be implemented. Eventually there will be a visible improvement in the economy, and although these were difficult decisions, you will later be pleased that they were taken."

Valdis Dombrovskis, Prime Minister of the Republic of Latvia, met with Senator George V. Voinovich in order to discuss the dynamics of bilateral relations between Latvia and the USA and the current economic matters.

During the meeting, the Prime Minister expressed gratitude to the Senator for his personal contribution towards introducing the Visa Waver Program for Latvian travellers. V. Dombrovskis informed G. V. Voinovich about the economic stabilisation programme and the governmental decisions on budget reductions aimed towards overcoming the economic crisis. Both officials exchanged views on the economic situation in Latvia and the USA. Prime Minister Dombrovskis noted the importance of the U.S. support to Latvia for the implementation of measures for overcoming economic crisis and for receiving an international loan.

The officials also touched upon the energy matters, and the Prime Minister outlined the situation in relation to the establishment of a single Baltic energy market and the development of interconnections with the Scandinavian countries in order to diversify the energy supply sources.

Senator George V. Voinovich expressed gratitude for Latvia's membership and support to NATO Alliance and the peace-keeping mission in Afghanistan. V.Dombrovskis declared that, regardless of the economic situation, Latvia will continue its participation in the mission in Afghanistan.

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The Saeima, 30 June 2009

President's Chancery, 30 June 2009

The Cabinet of Ministers, 30 June 2009

Latvia and Hungary share similar experience in overcoming their crisis

On Friday, June 26, in Budapest, during the first day of his working visit to Hungary, Valdis Dombrovskis, Prime Minister of the Republic of Latvia, met his Hungarian counterpart Gordon Bajnai and Minister for Finance, Dr. Peter Oszko. The sides discussed the economic situation in both countries and exchanged views concerning overcoming the economic crisis and cooperation with international lenders.

Hungarian Prime Minister Gordon Bajnai acknowledged participation of Valdis Dombrovskis in the official ceremony devoted to the 20th anniversary of the fall of the Iron Curtain on June 27, in Budapest. About 30 high-level delegations from various European countries will attend the events.

The Prime Ministers and Ministers for Finance discussed the main solutions for the economic crisis. Valdis Dombrovskis informed about the latest decisions of the Latvian Government and the budget decrease by 500 million LVL aimed at overcoming the crisis, as well as outlined the basic principles of the structural reforms.

The Hungarian Prime Minister and the Minister for Finance described their domestic situation which is similar to Latvia's economic crisis. In mid-May Hungary was visited by delegations of the International Monetary Fund (IMF) and the European Commission (EC) in order to prepare the second report concerning the international loan granted to Hungary. In view of the latest forecasts of the economic recession indicating that the GDP could fall by 6.7% this year, the Hungarian Government and their international lenders agreed on an increased budget deficit amounting to 3.9% of GDP instead of 2.9% as planned previously. The Hungarian Government has expressed its commitment to ensure that next year the budget deficit would not exceed 3.8% but in 2011 it would be below 3% of GDP.

After the meeting the IMF announced that the Hungarian Government has secured obligations with regard to its debts, inflation and international reserves and that it has fulfilled its structural reform tasks related to the pension system and ensuring governmental loans to banks. On June 23 the Board of the IMF adopted a decision to grant Hungary the third part (1.43 billion EUR) of its total loan amounting to 20.1 billion EUR.

The Hungary, similarly to Latvia, has also signed a Memorandum with the European Commission stipulating the pre-conditions for the next tranche of its loan in the amount of 1.5 billion EUR. The Memorandum sets forth that Hungary should reduce compensation part of salaries in the public sector (in Hungary some part of public sector employees are paid by means of various compensations and bonuses), it should also abandon its subsidy system for acquisition of housing, reduce the local government budget by 430 million EUR and ensure other expenditure cuts to the amount of 40 billion EUR.

The Memorandum also stipulates a number of other structural reforms, for instance, changes in the children and family benefit system, reduction of heating subsidies, ensuring free-of-charge meals for children at schools, restructuring of the taxation system, increasing taxes on consumption, for example, on real estate, aircrafts, etc.

After taking the office, on April 20, Gordon Bajnai presented the Action Plan of its Government for the next 12 months aimed at overcoming the economic crisis in Hungary. The plan included an increase in the value-added tax (VAT) and a reduction of social payments. It is planned that the Hungary will raise its VAT from 20% to 25% by preserving the current 18% for specific groups of food products and for heating. The excise tax will be increased from 6% to 8%; taxes will be increased on income allocated through offshore companies; the solidarity tax of 4% for companies will be abandoned but the corporate tax will be increased from 16% to 19%. Similarly to Latvia, it is planned to reduce public sector expenditure, for instance salaries of ministers are reduced by 15%, business trip costs – by 50%; a considerable reduction of salaries of board members of state-owned companies is also planned.

The programme envisages a GDP decrease by 6% instead of 3% as planned previously; and it also states that the recession in Hungary will continue in 2010. According to the Action Plan, the main priorities and measures of the Government are dividend in four categories – short-term crisis management, stabilisation measures, support to economic growth and rebuilding trust in the Hungarian economy.

At the beginning of May, the Hungarian Parliament approved amendments to the relevant laws and regulations implementing changes in the pension system – the most important change is the increased pension age from 62 to 65 years during a period of six years starting from 2012.

The Prime Ministers shared the view that cooperation of Latvia and Hungary should be developed, in particular in such areas as pharmaceutics, energy and tourism. By now bilateral economic cooperation cannot be described as dynamic and rapidly growing. One of the reasons – businesses of both countries are traditionally focused on different markets and different business cooperation regions. Since the accession of Latvia and Hungary to the European Union, economic and trade relations of both countries have been regulated by the legislation of the EU and the principles of single market opening new opportunities for more extensive economic cooperation. Valdis Dombrovskis and Gordon Bajnai expressed their conviction that the potential of the EU single market should be exploited more actively.

Cooperation with the relevant Hungarian organisations and businesses in the area of energy has also been insufficient; in future such cooperation could be developed in framework of various programmes, for instance energy efficiency programmes and programmes aimed at energy-efficient products, and manufacturing and use of energy-efficient equipment.

The Prime Ministers also discussed the energy issues of the Baltic region and the region of Visegrad States (Hungary, the Czech Republic and Poland). Latvian Prime Minister Valdis Dombrovskis informed about the background of the formation of the common energy market in the Baltic region and opening of the energy market. He noted that Latvia's priority is a functioning energy market which implies opening of the Estonian market by 2013 and actual market liberalisation in Lithuania. Along with the market liberalisation Latvia would expect implementation of infrastructure projects and projects aimed at installing new capacities in the framework of the new EU financial budget.

The Hungarian Prime Minister informed about the situation in his country concerning risks related to gas supplies from Ukraine. On January 6 this year Ukraine completely stopped its gas supplies to Hungary, and it was necessary to find an urgent solution to cope with the consequences of the Russian and Ukrainian gas dispute. Hungary decided to reduce gas supplies to the big industrial consumers, urgent to convert electric power plants to use oil and decided to open its gas reserves. In the result Hungary survived the crisis successfully not just with regard to Hungarian gas consumers but it could also provide help to neighbouring countries experiencing the most serious problems.

The Hungarian Prime Minister explained the main principles of the gas pipeline project Nabucco. In January this year in Budapest, a summit was organised on this gas pipeline which was also attended by Andris Piebalgs, the European Commissioner for Energy. The summit adopted a declaration stating strong support to the implementation of this project.

Another gas project of similar importance for Hungary is the South Stream pipeline. In March this year, the Hungarian Prime Minister visited Moscow and met representatives of Russian energy companies and the Russian Government; the sides signed an agreement on the establishment of a joint company which would be responsible for the construction of the gas pipeline section in the territory of Hungary. For Hungary, similarly to Latvia, diversification of energy sources is of great importance in order to divide risks and reduce dependence on one supplying country.

Both Prime Ministers discussed bilateral cooperation in international organisations, bilateral business projects which could be of interest for both countries, as well as international and cross-regional cooperation projects launched in the framework of the European Union. At the end of the meeting Valdis Dombrovskis encouraged Gordon Banjai to develop bilateral economic cooperation and an active exchange of views concerning the implementation of anti-crisis measures.

Valdis Dombrovskis expressed his gratitude for the invitation to the events devoted to the fall of the Iron Curtain and stressed that this was a historic event for all the European countries. His Hungarian counterpart presented to Valdis Dombrovskis a small part of the "Iron Curtain" – barbed wire which divided Hungary and Austria and was cut in 1989.

Read

The Cabinet of Ministers, 25 June 2009

Maris Riekstins: European security dialogue should promote trust between countries 

On 27 – 28 June, Foreign Minister Maris Riekstins took part in a meeting of foreign ministers from the participating States of the Organisation for Security and Co-operation in Europe (OSCE) on the island of Corfu, Greece. During the meeting, the ministers discussed topical issues of security policy, spanning the three OSCE dimensions - the politico-military, the economic and environmental, and the human dimension. Among other topics, the ministers also discussed Russia's decision to veto the extension of the mandate for the United Nations Observer Mission in Georgia that also leaves an impact on the European security debate.

When speaking about the future security in Europe, Foreign Minister Riekstins emphasised that the most essential was to restore the broken confidence between countries. "To this end, the countries should clearly demonstrate political will to honour current commitments which is the main prerequisite for tackling security challenges in Europe." 

In his address, Minister Riekstins also noted that the capability of the OSCE to achieve resolution of frozen conflicts would be a solid foundation for restoring confidence between the countries.  There must be a will to reach a compromise on such issues as a continued presence of the OSCE mission in Georgia," Mr Riekstins underlined.

The meeting of the OSCE foreign ministers was held on the initiative of the OSCE Chairperson-in-Office, Greek Foreign Minister Dora Bakoyannis.

Read

MFA, 28 June 2009

OSCE, Informal meeting of OSCE foreign ministers, 27-28 June 2009 

IN BRIEF

Third meeting of Latvia-Russia Intergovernmental Commission to be held on 29 July in Riga 

On 25 June, Co-chairmen of the Latvia-Russia Intergovernmental Commission (IGC) – the Minister of Economy of Latvia, Artis Kampars, and the Minister of Transport of Russia, Igor Levitin, agreed on the organisation of the third IGC meeting on 29 July in Riga.

During the discussion, Minister Kampars emphasised that the start of operations by the Latvia and Russia Joint Demarcation Commission is an issue of importance for Latvia, and invited the Russian side to approve as soon as possible the Commission's membership on the part of Russia. Other topics discussed were the promotion of transit, co-operation in the sector of rail traffic, the issues of border crossing and co-operation in the field of heritage values.

The parties also reviewed the possibilities for the expansion of the framework of bilateral agreements. The ministers agreed that, in the nearest future, the implementation protocol should be concluded for the Agreement between the European Community and the Russian Federation on readmission, which has been ratified by the Latvian side as early as on 11 June; also the Agreement on combating crime, in particular in its organised forms, and the Agreement on the alleviation of visa regime for residents of border areas should be signed. The IGC co-chairmen were of the same mind that efforts need also to be made on the co-ordination of other draft agreements which are being elaborated, including the agreements on the Avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital, on the Promotion and reciprocal protection of investments, on Co-operation in the protection of environment, on Co-operation in the prevention of emergency situations and elimination of their consequences.

The ministers shared the opinion that the IGC groups should continue their work all through the next month, and workgroup meetings or expert gatherings are to be held to prepare a substantial third IGC session. 

During the meeting, the parties commended the IGC work to date and its contribution to the development of bilateral relations, and agreed to continue to work actively on a constructive development of the economic co-operation and political dialogue.

Read

MFA, 25 June 2009

The President appoints new Ambassadors of Latvia to Finland and Denmark  

In Riga Castle on 3 July 2009, President Valdis Zatlers presented letters of credence to the new ambassadors of Latvia to Finland and Denmark.

From now on the Ambassador Extraordinary and Plenipotentiary of the Republic of Latvia to the Republic of Finland will be Mr Juris Bone, while the office of the Ambassador Extraordinary and Plenipotentiary of Latvia to the Kingdom of Denmark will be held by Gints Jegermanis.

When presenting letters of credence to the new ambassadors, the President wished them much success in their new jobs and urged them to dedicate all their strength and energy to the representation of the national interests of Latvia and to the fostering of economic and trade relations with the two Nordic neighbours.

In the discussion with the new Ambassador to Finland, Juris Bone, the President underlined that the experience of Finnish entrepreneurs would be very useful for their Latvian counterparts in improving their competitiveness both on the domestic as well as in the common EU market. Especially praisweworthy is the ongoing co-operation between the Latvian and Finnish food processing companies in entering new export markets in Finland. Latvia is also interested in attracting Finnish investment to its export industries with high added value: IT&T, pharmacy and biotechnologies, as well as in expanding co-operation with Finland in the field of tourism.

With Mr Gints Jegermanis the President talked about Latvia-Denmark economic co-operation, with special focus on tourism, transportation and logistics as the most perspective fields. Co-operation in the field of shipping could play a major role in further development of bilateral economic relations: the wish of influential Danish shipping companies MAERSK and DFDS to activate their operation in the Baltic region by investing in port development projects is good news in this regard. The President and the ambassador discussed also the upcoming Climate Conference that will take place in Copenhagen in December this year and the policy of the European Union aimed at mitigating the consequences of the climate change.

Among the duties of the new Ambassador will be the work on the establishment of the Honorary Consulate of Latvia in Greenland as well as the continuation of a broad and diverse Latvia-Denmark co-operation in the fields of culture and education.  

President's Chancery, 3 July 2009 

COMING EVENTS

6 July 2009

Participation by President Valdis Zatlers in the events dedicated to the Millennium of the name of Lithuania and the Day of the Coronation of the King Mindaugas in Vilnius, Republic of Lithuania

10 – 14 July 2009

State visit to the Republic of Tajikistan by President Valdis Zatlers

9 July 2009

Working visit to the Republic of Latvia by the NATO Secretary General, H.E. Mr. Jaap de Hoop Scheffer

LINKS:

http://www.president.lv

http://www.saeima.lv

http://www.mk.gov.lv

http://www.am.gov.lv


The newsletter "Latvia today: foreign policy news" is a compilation of press releases and news reports drawn from the media and official sources. The views published do not necessarily reflect the official position of the Ministry of Foreign Affairs