Middle Ages to the 19th century
Around 1200 AD the area of what is now the Republic of Latvia was populated by Baltic tribes, including the Latgals, Selons, Semgals, Kuren and Liven. From the beginning of the 13th century, the area was conquered by the “Teutonic Order” (German Order). Agriculture and trade were dominated by German landowners and merchants.
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Around 1201, the city of Riga was founded at the mouth of the D¨¹na river in the Baltic Sea. Riga joined the German Hanseatic League in 1282, a union of northern German trading cities. The city achieved great prosperity through worldwide trade relations.
In the middle of the 16th century, after the final demise of the Teutonic Order, the areas of what is now Latvia were divided: the part north of the D¨¹na (Livonia) initially fell to Lithuania-Poland, 1629 to Sweden, 1721 (after the Second Northern War) Russia. The southern part of the country was under the sovereignty of Poland as the Duchy of Courland until the end of the 18th century, and in 1795 these regions also fell to Russia. Riga became an important trading center of the Russian Empire.
The first national movements against the suppression of Latvian culture and language by the tsars started early (in 1868 the “Latvian Association” was founded). After the first Russian Revolution in 1905, members of the Latvian independence movement protested against the Tsar House in Riga. Moscow granted Latvia its own parliament.
After the beginning of the First World War, Latvia was occupied by German troops in 1915. In November 1918 the Latvian People’s Council proclaimed the independent Republic of Latvia. As a result, fighting broke out between Russian troops on the one hand and German, Baltic-German and Latvian troops on the other. The Republic of Latvia was recognized by Russia two years later (Riga Peace Treaty).
In 1922, the Social Democrats took over the leadership of the government of Latvia. According to AbbreviationFinder, a constitution was adopted, the economic supremacy of the German Baltic states ended through expropriation and land reform. Between 1918 and 1934, internal tensions and the fragmentation of parties in parliament (over 100 parties) led to a total of 18 changes in government. In addition, there was the global economic crisis that broke out in 1929 and exacerbated the conflicts.
In 1934 there was a coup d’¨¦tat under the Prime Minister Karlis Ulmanis, the leader of the Peasant Association: he lifted the constitution and established an authoritarian dictatorship based on the Peasant Association and the military. Latvia’s attempt to remain neutral in the outbreak of World War II in 1939 failed: the non-aggression pact concluded between the Soviet Union and National Socialist Germany (or its secret additional protocol) assigned Latvia to the Soviet sphere of interests. In June 1940 Russian troops occupied Latvia. The country was incorporated into the USSR as the “Latvian Soviet Socialist Republic”. From June 1941 until the Red Army recaptured the Latvian territories were occupied by German troops.
It was only when the reform policy under Mikhail Gorbachev started in the Soviet Union in the mid-1980s that the Latvian independence movement was able to regroup. In October 1988 the Latvian “People’s Front” (Tautas Fronte) was founded in Riga. In June 1990, the three Baltic states, Latvia, Lithuania and Estonia, announced their withdrawal from the Soviet Union. The Soviet leadership then sent troops to the areas, but after violent clashes, Latvia’s state independence was recognized by Moscow (September 1991). In the same year all three Baltic states were admitted to the United Nations.
After the Latvian constitution of 1922 came into force again, an alliance of reform communists and emigrants (“Latvian Way”) won the 1993 elections. The Latvian Popular Front, which had been dominant up to this point, failed like the 19 other parties due to the four percent clause. The first government was a coalition between the “Latvian Way” and the farmers’ union, whose member Guntis Ulmanis was elected new president. There were also frequent changes of government in the 1990s. Most governments aimed to quickly reorient the country towards a free market economy. In the parliamentary elections in October 2006, a government was confirmed in office for the first time since independence, however, the national conservative coalition had to resign in December 2007 on charges of corruption.
Accession to the North Atlantic Defense Alliance (NATO) was carried out in March 2004 and that to the European Union (EU) in May 2004. The prerequisite for the latter was, among other things, a revision of the tough policy towards the Russian minority in the country (approx. 30% of the population); the Citizenship Act was reformed in 1998 and now conforms to European standards. Latvia has been part of the Schengen area since the end of 2007. The three Baltic States work closely together in foreign policy (“Baltic Council”).
The global financial crisis of 2007/2008 did not stop at Latvia either. In November 2008, the bankruptcy of the country’s second largest bank, Parex Bank, was only averted by nationalization. In 2009, Latvia saw a decline in GDP of 18%, the most struggling EU-wide with the effects of the global financial crisis. After mass protests against the government, Prime Minister Godmanis announced his resignation in February 2009. Valdis Dombrovskis (JL) then formed a right-wing coalition government. The IMF and the EU granted the country an emergency loan to overcome the economic crisis. In return, the government implemented extensive austerity measures and increased taxes.
The Dombrovski government lost a majority in parliament in March 2010. The reason was the withdrawal of the People’s Party (TP) from the five-party coalition in protest against the government’s strict austerity policy. In the parliamentary elections in October 2010, the JL won 57% of the vote. Valdis Dombrovskis remains head of government.
Latvia has been a member of the euro area since January 1, 2014.