The Baltic Times: The privatization of the state shipping company, and the instability that has accompanied it, has again raised questions about the influence Ventspils Mayor Aivars Lembergs is rumored to wield among MPs. What are you doing to make Latvian politics more transparent?
Berzins: This is a new democracy. Some of the newer parties are still learning about politics and may be more easily influenced. But I don't feel much instability in the government. There's a lot of talk of instability but no evidence of it. We're working pragmatically and trying to stick to the agreements made between the coalition partners.
On the privatization of the Latvian Shipping Company we've followed the advice of international consultants. As far as I know no other east European government has invited corruption watchdog Transparency International to monitor a privatization process.
Corruption is a problem and we're determined to fight it. The public can already find out about MPs' incomes at the State Revenue Service. Political parties are obliged to reveal their funding sources to the Registry of Enterprises, whose records are also open to the public. Nonetheless, a new party financing act is being drawn up which will draw on methods used by European Union countries to combat the problem.
TBT: So the shipping company won't be sold to a shady bidder with connections to Russia's oil industry?
Berzins: The rules of the game are clear. There is a long list of bidders. They all have a chance.
TBT: If the opposition Social Democratic Workers' Party do well in the upcoming municipal elections are you afraid that the country's EU and NATO membership plans will be thrown into disarray by a government collapse?
Berzins: All the parties in Parliament are committed to EU membership, including the so-called Social Democrats. But the two groups which dominate the Social Democratic Workers' Party are old-fashioned socialists, not social democrats. A third group are modern west-European-style social democrats who I have nothing against.
People believe the Social Democrats can perform miracles, will do everything for them. This is like in the old days when everything was decided from Moscow or Riga. Psychologically that way of life was easier for many people. No one thought about the future or had to accumulate a pension. There were no opportunities.
Today you are free, but you have to realize your own potential, be yourself, take action, without orders from Moscow. For the older generation this is hard, and they're the Social Democrats' main supporters.
TBT: But the Social Democrats have a powerful weapon in the form of Dainis Ivans, their No. 1 candidate for Riga mayor. Are you worried that his party, which so distrusts the West, may be carried into power on his coat tails?
Berzins: Political parties try to find personalities with good popularity ratings and use them to achieve their ambitions. That's life. If this happens it won't take long for society to realize who is who. It's one thing for the Social Democrats to criticize the government in their speeches, but managing things, taking responsibility, finding solutions is different.
The Social Democrats haven't been in power either at the municipal or central government level. But maybe society needs a period in which they can see for themselves, find out who's who. It would be a painful experience for society. But who knows? Maybe we need such a stage, if it didn't hinder our strategic goals - EU and NATO membership.
TBT: But doesn't the Social Democratic Workers' Party have a good point when they blame the impoverishment of the countryside on the lowering of import tariffs on agricultural products, a move which has flooded the market with cheap products subsidized by the EU, without giving Latvia access to the EU's own markets?
Berzins: This is untrue. Since we opened our borders to the EU meat prices have risen, not fallen. Everyone has to take the initiative and modernize farming so they're producing for the market, not as a hobby. The problem is that the end of collective farms destroyed agriculture. It was an inefficient system employing two or three times more people than in the West.
But things are changing. GDP increased last year for the first time since the Russian crisis. We're harmonizing our laws with the EU and have signed the SAPARD agreement with the EU which will help us modernize. Our regional development program is being implemented and we're working with investors. The planned paper mill in eastern Latvia is one example.
TBT: The Economist Intelligence Unit recently warned that the EU's failure to reform agricultural subsidies is going to delay enlargement. The agricultural lobby in western Europe is not going to support extending subsidies to countries like Latvia, is it?
Berzins: I'm not an EU commissioner, but personally I think there are still unsolved problems in the EU's own agriculture sector. We're expecting to play by the same rules as west European countries. They've shown the political will. When I was at the EU's Nice summit, I heard leaders expressing their commitment to an enlarged EU in which the same policies apply to all.
TBT: Your leadership style differs quite a lot from that of your predecessor Andris Skele. You're now approaching a year in office, the upper limit for Latvian prime ministers if we judge by the past. How are you going to hold on?
Berzins: Today the minister of interior told me I'd been in office four days longer than my predecessor. I don't foresee difficulties in the present government being successful, nationally and internationally. I plan to keep it running until parliamentary elections in October 2002.
To make progress you have to keep the peace. I spend a lot of my time harmonizing the opinions of the parties and negotiating between them. The agreements we've reached mean we've been able to move forward quickly, and in a disciplined fashion. We don't have much time. Our aim of being ready for EU membership by the end of 2002 is ambitious.
TBT: When, last week, you kicked the New Party out of the coalition, without expelling MPs in the more powerful For Fatherland and Freedom party it looked as if you were bullying a vulnerable small party.
Berzins: These MPs had left the party they were elected to serve in. Being in the coalition means following certain rules we've agreed on. One of the rules is you don't vote for opposition proposals related to tax legislation and the budget. At a meeting on Oct. 25 it emerged that For Fatherland and Freedom and the New Party were thinking of voting for the opposition proposal (on exempting traditional religions from property tax).
We then had an extraordinary meeting of the coalition council where I said they were breaking the rules. For Fatherland and Freedom changed their mind. Only three of their MPs would vote with the Social Democrats, they said. We added up the votes and saw that that would defeat the opposition so we agreed.
The New Party said they would vote two for the opposition, two for the government. I said they couldn't do that. They then promised not to vote for the opposition. But 20 minutes later all four of them voted for the opposition. I wrote to them telling them to be happy in the opposition.
You have to choose what you're going to be - government or opposition - and follow the rules. This was a signal to others who might like to play similar games in the run up to elections. There's a Latvian expression: you can't sit on two chairs at the same time.
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