About Latvia & Key Financial Statistics

About Latvia and Key Financial Statistics

Overview of Economy:

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.

Gross Domestic Product (In USD):

$48.36 billion (2014 est.)

$47.25 billion (2013 est.)

$45.33 billion (2012 est.)

Composition of Gross Domestic Product:

% Agricuture: 3.4

% Industry: 23

% Services: 73.5

Composition of Labor Force by Occupation:

% Agriculture: 8.8

% Industry: 24

% Services: 67.2

Per Capita Income: