CER | Latvia: LASCO privatisation row continues

Privatization saga continues

Wrangling between the ruling coalition parties over the privatization of the Latvian Shipping Company (LASCO) continued, threatening to scuttle the sale and bring down the current government. Three previous attempts to sell the company failed, in turn causing the collapses of governments.

Latvian Prime Minister Andris Bērziņš called for prosecutors to investigate bribery allegations made by a state-appointed trustee in the company. Eižens Cepurnieks (of For Fatherland and Freedom) said several high-ranking government officials had been offered up to USD one million to rig LASCO's privatization.

For Fatherland and Freedom members have told the media that the Privatization Agency has structured the sell-off rules in ways that they favor one particular investor allegedly linked with Russian energy companies Itera and LUKOil.

The World Bank, as well as the US ambassador, this past week criticized Latvia for dragging out the privatization of LASCO and other key state-owned enterprises have criticized Latvia.

In the meantime, the Privatization Agency announced that it will conclude an "integrity pact" with Latvia's branch of Transparency International, whereby it will officially become an independent observer of LASCO's sell-off.

The "integrity pact" is a method introduced by Transparency International, the international anti-corruption NGO, to help governments, businesses and society that are ready to work towards eliminating corruption in privatization of state property and supervision over state and municipal purchases.

Foreign Minister in Moscow

Foreign Minister Indulis Bērziņš visited Moscow as the chairman of the Council of Europe Committee of Ministers to discuss with Russia the situation in Chechnya. He promised "to make an objective assessment of the situation" and "be neither prosecutors nor defense attorneys for Russia."

This week, at the Council of Europe Parliamentary Assembly (CEPA) session in Strasbourg, Bērziņš will deliver a report about the Council of Europe's role in introducing the rule of law, human rights and democracy in Chechnya. CEPA members will use this and other information to decide whether to restore Russia's voting rights in the body.

The visit was preceded by a traditional diplomatic outburst from a Russian deputy foreign minister who criticized Latvia for "treatment of Russian speakers" and warned it against joining NATO. Indulis Bērziņš, however, announced that during the talks his Russian counterpart Igor Ivanov promised to pay a visit to Riga. Bērziņš also said that he urged the Russian government to sign the Russian-Latvian border agreement.

President Vaira Vīķe-Freiberga also said in an interview that she is open to dialogue with Russia and is prepared to meet the Russian president at the first opportunity. She said Latvia did not anticipate danger from any specific direction and was striving to join NATO simply to enhance security and promote economic development.

Dysentery outbreak amid election campaign

Latvian prosecutors launched a probe in an outbreak of dysentery in a military guard regiment and other public facilities throughout Latvia. Over 100 soldiers of the regiment fell ill with dysentery with low quality dairy products suspected of being the source of the infection.

Results of the investigation by different food safety and public health authorities fueled political arguments between different parties in the ruling coalition over responsibility for the epidemic. It is perceived to be part of municipal election campaign, which will be held in March.

A junior coalition party, For Fatherland and Freedom, is enjoying the most support, 16.5 percent, at the upcoming municipal elections for Riga. The party currently holds the post of Riga mayor. The Social Democrats polled 14.9 percent support in the capital.

Tightened control over extremists?

The Saeima sent to committees legislative amendments to grant the Constitution Protection Office (SAB), the country's top security agency, the right to file a request in court to suspend activities of NGOs.

For Fatherland and Freedom MP Dzintars Kudums said that the amendments are needed to avoid repeating a situation when several members of Russia's radical National Bolshevik movement entered Latvia visa-free and later lock themselves up in St Peter's Church in central Riga and threaten to blow it up. The actions by the National Bolsheviks triggered broad discussions about actions of such organizations in Latvia.

New political party established

About 100 people led by Dainis Turlais, a former cabinet minister, established a new left-of-center political party named Mūsu Latvija (Our Latvia). Turlais was elected as the party chairman and promised to defend interests the interests of businessmen while voicing reservations about Latvia's accession to NATO and defense spending rise.

The new political party is set to take part in local elections to be held in Latvia in less than two months. The party has over 400 members, nearly half of whom do not have Latvian citizenship. Unsurprisingly, the party "will seek to make use of Latvia's favorable geographical and political position to maintain good relations with neighboring countries, including Russia."

In the meantime, the New Party, a small centrist group in the four-party ruling coalition that has been plagued by the loss of many members and falling poll ratings, has been renamed the New Christian Party and elected Lutheran pastor Guntis Dišlers its chairman.

Latvian to play in NHL's All-Star game

Latvian hockey player Sandis Ozoliņš of the Carolina Hurricanes will be one of the two defensemen starting for the World Team during the National Hockey League's All-Star game scheduled 4 February in Denver. NHL.com announced the results of hockey fan voting after the league had to hand count ballots for two positions, including Ozoliņš.

The World Team will play against North American NHL players. With a total of 185,173 votes, Ozoliņš topped Russian Sergei Zubov of the Dallas Stars by nearly 33,000 to take the second defenseman position. Ozoliņš and teammate for both the Hurricanes and the Latvian national squad, Artūrs Irbe, are consummate NHL all-stars.

"Cyber-town" Valmiera

Educators in the northern Latvian town of Valmiera announced a plan to transform this small town into a model Internet society in which all municipal business will be conducted online and high-technology companies will be encouraged to invest.

The aim would be for this town of 29,000 people, located some 100 kilometers northeast of Riga, to eventually become Latvia's information technology capital, Gunārs Bajārs, rector of the local Vidzeme University said. Currently, just under five percent of the households in and around Valmiera are online. Nationwide, around 15 percent of Latvians are hooked up to the Internet.

Bajārs said the plan, which envisions connecting nearly all offices and homes to the Internet, would cost "several million dollars." He said he hoped funding would come from national and local governments, and corporate sponsors.

Business and Economy

The US Department of Commerce decided to introduce tariffs of 17 percent on rebar imports from Latvia. This anti-dumping move is likely to hurt steel producer Liepājas Metalurgs, which exported up to 50 percent of its output to the US before anti-dumping proceedings closed its access to the market last year. Liepājas Metalurgs said that the preliminary ruling by the US Department of Commerce in an anti-dumping case was unacceptable.

No out of court settlement is seen in an international arbitration court where Tilts Communications, a group of investors led by Finland's Sonera, is sticking to its compensation claim in a dispute with the Latvian state over cutting the fixed-line monopoly of Lattelekom to 2003 from 2013, Transport Minister Anatolijs Gorbunovs said. The media cited unofficial sources estimating Tilts Communications' claim at USD 360 million.

Daria Kulagina, 19 January 2001

Moving on:

Sources:

Diena
Reuters
Neatkarīgā Rīta Avīze
LETA
BNS
Dienas Bizness
Bizness Baltija