Prime minister steps down

RIGA - Latvia has been thrown into a political storm following the resignation of embattled Prime Minister Ivars Godmanis and the collapse of the government.
Godmanis stood down on Feb. 20 amid growing backlash over his government's handling of the country's worsening economic crisis.

His fate was apparently sealed after the two largest members of his center-right coalition, the People's Party and the Union of Greens and Farmers, refused to back him and called on him to step down.
The government had been teetering on the brink of collapse in recent weeks as bitter in-fighting and speculation about its future clogged political forums.
President Valdis Zatlers has called for calm amid fears of further political upheaval.
"The situation should not be dramatized. There is no power vacuum in the country and the present government will continue the work until a new Cabinet of Ministers is formed, to ensure smooth transition," Zatlers said in a statement to The Baltic Times.

Political jockeying has been fierce since the incumbent prime minister's resignation, with the president expected to announce a replacement on Feb. 26.
"The President will use all the rights that have been provided to him in the Constitution to further the process of government formation. He has started consultations with all the political parties in the parliament to ensure the quickest solution to nominate a candidate for Prime Minister," his spokeswoman told TBT.
So far several parties have named candidates for the prime minister.
The People's Party, a former ruling coalition member, has proposed Regional Development and Municipal Affairs Minister Edgars Zalans.

Former opposition center-right New Era party has named MEP Valdis Dombrovskis, while leftist alliance the Harmony Center has named its parliament faction head Janis Urbanovics as possible contenders.
The preferred candidate for the Greens and Farmers' Union 's Ventspils Mayor Aivars Lembergs 'sis currently on trial on several charges, including corruption, money laundering and abuse of official powers, and is unable to run.

HERO TO ZERO
Godmanis has twice served as premier of Latvia, the first time steering the country to independence from 1990 to 1993.
He again took office in December 2007 when his predecessor, Aigars Kalvitis, was forced out following mass protests in the streets.
Since then, Godmanis has presided over a spectacular economic crash and soaring unemployment levels as the global financial slump took its toll.
In December Latvia was forced to seek a 7.5-billion-euro bailout from the International Monetary Fund (IMF) and other lenders.

It's been estimated the Latvian economy will contract up to 12 percent this year.
Godmanis' resignation comes just two months after his government launched a harsh austerity program which included cuts to public spending and increased taxes as part of the country's obligations to the IMF.
Frustration over his government's management of the worsening economic crisis boiled over in violent riots on Jan. 13, where protesters calling for his resignation clashed with police and attempted to storm the parliament building.

Godmanis later survived a Feb. 3 no-confidence vote, but faced renewed pressure when President Valdis Zatlers announced he had lost trust in the prime minister.
Zatlers earlier threatened to disband the parliament if key demands, including a restructure of government institutions and administration, were not met by March 31.
Efforts by the Godmanis-led coalition to act on the president's demands had been stymied in recent weeks by a disagreement over the terms and principles.
It remains unclear if the president's demands will be met in time for the March 31 deadline.

"The tasks to the Saeima [Latvian parliament] and the government given by the president remain the same. However, the president doesn't want to speculate about their results. There have been steps taken in fulfilling six tasks the president put forward and the work is in progress," a presidential spokeswoman said.

FRESH HOPE
Latvia's former opposition parties have called for a broad and fresh coalition government to tackle the country's ongoing economic woes.
Measures for increasing budget revenues and rationalizing the public administration will be among the most pressing matters for the new government.

In a statement released to the media, New Era said Latvia urgently needed a professional government capable of bringing economic, financial and political stabilization to the country.
"The ability of political parties to agree on a competent and capable government with stable support in parliament will be crucial for economic stabilization. The situation is extraordinary and therefore requires immediate action, New Era said in the statement.

On Feb. 24 political parties indicated they will wait for the president to nominate the new prime minister before proceeding with talks about possible cooperation in the new government.
Yet Harmony Center leader Janis Urbanovics said negotiations no longer made sense.
"We know each other so well in the parliament. This [consultations before nomination of the prime minister] is a waste of time and money," said Urbanovics.
"As soon as Dr. Zatlers issues a prescription, we will start filling it," he said, referring to the president's medical profession.

However, Maris Kucinskis, the head of the parliamentary faction of the People's Party, did not rule out informal consultations between the parties.
Three members of the former four-party coalition 's the People's Party, the Greens and Farmers Union and Latvia's First Party/Latvia's Way 's have already held bilateral meetings and agreed that they could work within a coalition again.

The remaining former ruling party 's Fatherland and Freedom/LNNK 's has so far only held official talks with New Era.
Previous negotiations among political parties suggest the potential new coalition, comprising of New Era, the People's Party, the Greens and Farmers Union and Latvia's First Party/Latvia's Way, would have 62 votes in the parliament.