RIGA - It seems strange to recall that one year ago, prior to accession to the European Union, there were doubts about the ability of Latvia and the other new member states to compete in the European single market.
Fears were expressed that local enterprises were too small and weak, the labor force too inflexible and uneducated, and the bureaucracy too inexperienced and corrupt to deal with the competition coming from the West. However, today France, Germany and the countries of "old Europe" fret about how to compete with the low-tax economies and cheap workforce of the new member states.
Thus the new member states have shown that their economies can continue to grow briskly within the EU. And countries such as Poland (during the Ukrainian presidential election crisis at the end of 2004) and Hungary (with its aggressive advocacy of Croatian EU membership) have been assertive on the European diplomatic stage.
Unfortunately, the same cannot be said about Latvia and the other two Baltic states. Initial talk of the Baltic state's role in the "northern dimension" of the EU or as a "bridge" to Russia have withered away and been replaced by embarrassing (to other EU leaders) bickering with Russia about the legality and legacy of the Soviet occupation. In the case of Latvia, this is largely because there is no strategic vision of its role as an EU member country, nor what kind of EU Latvia would like to see in the future. Indeed, there isn't even a dialogue within Latvia, at elite or popular levels, on these issues.
There are three major reasons for this. First, an inevitable period of smug relaxation followed the nerve-jangling race to join the "big bang" enlargement of 2004. After all, the helter-skelter sprint to fulfill the commitments of the acquis communitaire and then ensure a "yes" vote in the national referendum on membership, left the Latvian administrative and political elite exhausted. Second, a significant brain-drain of Latvia's finest administrators to the institutions of the EU, coupled with an administrative re-organization of the Latvian European Affairs Bureau, has created a vacuum in European affairs. Third, the EU institutions are geographically far away, and the myriad decision-making procedures and policy discussions are far too obscure and complicated for the Latvian media to cover in any depth.
Nevertheless, in a recent paper for the Strategic Analysis Commission, Toms Rostoks and I argued that having achieved its long held ambition of full membership in the EU, it is time for Latvia to develop a clear set of aims and strategies. Our suggestion was that, as the poorest and unhealthiest state in the EU and, moreover, with a large, belligerent neighbor, Latvia should focus on utilizing the EU to achieve three inter-related aims: wealth, health and security.
This entails focusing on the economic opportunities that the huge European single market presents rather than a naive belief that the structural funds, generous as they are, will inevitably lead to economic growth. Greece has provided concrete evidence that this is not so. And Latvia will not be another Ireland. It does not possess the geographical, linguistic and historical links with the U.S.A. that led to a huge influx of American FDI from the late 1980s onwards, nor does it share the Irish government's long-term strategy for growth. EU social regulation, coupled with growing national wealth, should lead to an upturn in the general health of the population, while continued integration with the rest of Europe will provide increasing "soft" security guarantees,
But how can these aims be achieved? While this article does not have the space to go into policy details, there are two general strategies to begin with. First, Latvia has to focus on placing Latvian nationals in EU institutions much more seriously. At the moment there are several hundred jobs allocated to Latvian nationals that have yet to be filled. This is a missed opportunity because these positions create a vital, albeit informal, link between the member states and the Brussels institutions (particularly the European Commission). The state should help Latvian nationals prepare for the EU entrance examinations and create a central database of both senior job opportunities in the EU and suitable Latvian candidates.
Second, more effort should be expended on the creation of a "Baltic Bloc" based on the Benelux model of cooperation. While there is anecdotal evidence that Latvians, Lithuanians and Estonians have cooperated on an increasing number of EU issues since May 2004, this is still on a largely ad-hoc basis and needs to become more formalized. Only by acting in unison will the Baltic states be able to punch above their weight.
With a clear vision and strategy, Latvia has the opportunity to gain much from the European Union, both economically and politically, and play a role in shaping its future development. And this is certainly possible. Look at the teeth-gritting determination that nudged Latvia, against all odds, into the NATO and EU. Time for the congratulatory back-slapping to end, and the work to begin.
