LATVIA HAS ACQUIRED UNPRECEDENTED SECURITY THAT HAS EVER BEEN WITNESSED IN THE COUNTRY'S HISTORY
Caspian Energy (CE): Mr. Pabriks, what is the basis of the Latvian foreign policy? What is the geography of foreign policy's priorities determined by the government for the nearest future? What is the long-term development strategy of Latvia? What changes has this strategy undergone in respect to the country's joining the EU?
Artis Pabriks, Minister of Foreign Affairs, the Republic of Latvia: In 2006 Latvia approved Foreign Policy Guidelines for 2006-2010, which outline a successive foreign policy direction for the next five years. The goal of the previous foreign policy guidelines was to strengthen Latvia's regained independence at the international level; whereas the goal of the new foreign policy guidelines is to increase the country's international influence. In the document Latvia has defined the following foreign policy objectives: to promote the welfare of the people of Latvia; to enhance national and public security, reducing direct military threats, combating international crime, and diminishing the causes of ecological catastrophe; to strengthen democracy and to eliminate global poverty and the spread of disease; to enhance economic potential by attracting investments, ensuring the increasing competitiveness of Latvian businesses, and protecting the interests of those businesses abroad; to strengthen national identity by popularizing the country's image and providing support for the Latvian diaspora.
Our priority in the economic field is to promote competitiveness in the global marketplace. We are putting utmost effort in attracting productive foreign direct investment, not least in the areas where our key competitive advantages lay - our outstanding geopolitical location and our well-educated multi-lingual workforce. Transit/logistics and finance are the most promising sectors. Similarly, we encourage foreign investment in high-value, knowledge-intensive industry in order to boost Latvian export competitiveness in the future. Nowadays foreign policy is inextricably linked to a country's economic and commercial interests. Latvia is no exception in this respect.
CE: To what extent has Latvia succeeded in achieving its primary foreign policy's objectives?
Artis Pabriks: Latvia's accession to the EU and NATO signaled the achievement of the country's main goals in terms of institutional membership. Latvia has thus acquired unprecedented security - more security than has ever been witnessed in the country's history. Under this status, Latvia can develop, knowing that the traditional military threats against the state have diminished considerably. This provides greater opportunities and freedom of action in terms of the country's development and shaping of its foreign policy.
At the national level, the country's development has allowed the people of Latvia to make broader use of the opportunities afforded by the present-day international environment. Latvian businesspeople have commenced operations in various parts of the world which, just a few years ago, were all but inaccessible to Latvian representatives. The people of Latvia now enjoy more extensive opportunities related to travel, education and work throughout the world.
These are achievements of which the citizens of Latvia can be proud of, because they provide them with a clear understanding of their role in the world. Latvia's foreign policy must seek adequate solutions and instruments in order to secure and defend these growing opportunities.
CE: How did Latvia benefit from joining the EU? What issues within the EU are most important for Latvia?
Artis Pabriks: By joining the EU in 2004 Latvia has ensured its long-term security and stability perspective as well as opportunities for economic growth in the future.
Since joining the EU in 2004, Latvia has been actively involved in the process of shaping the EU decisions and framing common policies. Latvia takes part in the work of all EU institutions both at the level of public administration and non-governmental organizations. Having become a full-fledged member of the EU, Latvia has gained the valuable opportunity to participate and contribute to the regional decision-making on a high level, at the same time developing economically within the highly competitive single market of the EU.
During the last three years Latvia has greatly benefited from the EU financial assistance amounting totally to more than 625 million euros. Latvia's environmental and transport sectors, education and science branches as well as rural areas could serve as fine examples of positive development effect. Improved water and waste management infrastructure, reconstructed roads and bridges, increased number of exchange students and rural entrepreneurs are just a few such examples of success. The current EU financial perspective 2007-2013 will be crucial for Latvia's further growth. More than 4.5 billion euros will be made available for various projects in Latvia. National priority for the current financial perspective is investment into research and development, science and innovations, infrastructure and many other important areas.
It is in Latvia's interests to have an economically and politically strong European Union. Latvia is committed to contribute to the EU's overall economic growth by implementing respective measures at national level and participating proactively in EU policy-making. Enhanced EU competitiveness is a key prerequisite for Latvia's sustainable development. Improvements in the EU internal market serve Latvia's interests with particular emphasis on liberalization of the Union's services market and lifting of restrictions to the free movement of labour.
CE: What are the EU's top priorities during Germany's chairmanship? Do negotiations with Russia in energy sphere remain significant and what does Latvia expect from these talks?
Artis Pabriks: The Germany's EU Presidency comes at a difficult time for the Union. On the one hand, the Presidency has to proceed with the work on a better and more efficient functioning of the Union, the issue of the Constitutional Treaty being the most urgent one. On the other hand, the Union faces more and more new global challenges such as migration, terrorism, energy security, regional conflicts, increased competition in the world, climate change etc., which requires an adequate response from the Union. The Germany's EU Presidency has put forward ambitious objectives in shaping Europe's economic, social and environmental future, further strengthening of an area of freedom, security and justice as well as development of the Common Foreign and Security Policy, external economic and development policies. Development in the area of the EU Energy policy, Lisbon Strategy, EU-Russia dialogue, European Neighborhood Policy, EU strategy towards Central Asia are particularly important issues for Latvia during the German's EU Presidency. It is also important to continue moving forward in the transatlantic dialogue and European Security and Defense Policy.
Dialogue on energy issues with Russia remains a top priority for the European Union. Energy is discussed at the highest level in EU-Russia summits and at the Permanent Partnership Councils on Energy. The EU is currently working towards finalizing a mandate for the Commission to negotiate and conclude a new Partnership and Cooperation Agreement with Russia and within these negotiations Latvia expects that Russia will follow up its determination to negotiate on binding principles for energy trade. These principles should be based on the Energy Charter treaty and those adopted at the G8 summit in St. Petersburg in 2006.
CE: What are EU's expansion strategy and its basis? What is Latvia's opinion on theses issues?
Artis Pabriks: Enlargement policy has been at the heart of the EU's development over several decades. EU enlargement is a historical project based on a vision of a united Europe and its global role. Politically, EU enlargement has helped respond to major changes such as the fall of dictatorships and the collapse of communism. It has consolidated democracy, human rights and stability across the continent.
Economically, enlargement has helped to increase prosperity and competitiveness, enabling the enlarged Union to respond better to the challenges of globalisation. This has brought direct benefits for Europe as a whole. The enlargement process has increased the EU's importance in the world and made it a stronger international player.
EU enlargement policy is today based on three basic principles: consolidation of commitments, conditionality and communication. Consolidation of the EU enlargement agenda means that the Union is cautious about assuming any new commitments, but honours its existing commitments towards countries already in the enlargement process. The EU has started accession negotiations with Turkey and Croatia and offered a European perspective to the other countries of the Western Balkans. This commitment is a strong incentive for the countries to continue their reforms.
Rigorous but fair conditionality is applied to all candidate and potential candidate countries. Every step forward depends on each country's progress in meeting the necessary conditions at each stage of the accession process. This approach helps to consolidate reforms and to prepare new Member States to fulfill their obligations upon accession. For enlargement to be a success, EU must ensure the support of its citizens. Member States need to take the lead in communicating effectively the enlargement process and in particular the benefits that it offers for EU citizens. Democratic legitimacy remains essential for the EU accession process.
Latvia has always been a staunch advocate of EU enlargement and continues to support further EU enlargement. Latvia supports the accession process of Turkey and Croatia and the European perspective to the other countries of Western Balkans. From our own experience we know that EU perspective is a good incentive for reform implementation.
Enlargement has shown its enduring value as one of the EU's most effective policies, successfully contributing to peace, stability and democratic development throughout the continent. As well as having increased security and stability in Europe, enlargement has also brought economic benefits.
On the other hand, EU's integration capacity also has to be taken into consideration. Therefore, individual approach and conditionality are essential in order to ensure that further EU enlargement is successful. EU will also have to implement certain institutional and financial reforms because further EU enlargement must not have a negative impact on EU's effectiveness and decision-making and decision implementation capacity.
CE: In January 2007 Latvia called the EU countries to establish a uniform energy policy including creation of an integrated energy market and emergency response system and diversification of sources and their supply routes. What concrete offers does Latvia have in this respect?
Artis Pabriks: Our first offer for the EU is to move forward with the creation of a uniform EU market, which will also be a major step towards higher diversification of sources and routes of supply, since each of the different regional markets has its own tradition of supply. This would permit, for example, to use Nabucco and Baku-Tbilisi-Odessa-Brody projects for supplying to the northern parts of Europe. Hence, we are interested in the development and use of the Odessa-Brody pipeline for supplying high quality Caspian oil in a northwestern axis, also through the ports of Latvia to major consumers.
Creating interconnections will also allow developing and utilizing Latvia's potential underground gas storage capacities (exceeding 50 billion m3) to create and manage emergency response systems. There are geological structures present in Latvia suitable for storage of such large amounts of natural gas. We are currently undergoing a geological study to obtain more information about these underground structures.
CE: How is the problem with energy independence in the Baltic States being solved? What is the potential of exploration and production of energy resources on the shelf of the Baltic Sea?
Artis Pabriks: It is true that we have no alternative supply for gas as Russia and gas does make up 30% of our energy mix. At the same time the utilization of existing Latvia's underground gas storages, allows us to be autonomous in our gas supply during winter extending our supply also to Estonia and St. Petersburg region. In terms of electricity Latvia is self-sufficient only to the extent of 68-70%. However, our energy strategy until the year 2016 states that through building additional generating capacities, we will obtain 100% self-sufficiency by the end of the strategy's term. Partnership in the Ignalina nuclear power plant project, will give us additional security. In order to diversify our market access, we are also actively involved in the already existing interconnector Estlink between Estonia and Finland, as well as supporting the creation of the PowerBridge link between Poland and Lithuania. There are also proposals to connect the Baltic States with Sweden. With regards to oil Latvia will always be dependent on imported resources. While there are capacities in the Baltic Sea shelf, these will not be sufficient to give long-term security and could provide only a small part of our fossil fuel needs. However, we are going to use this opportunity and to start extracting oil in the next few years.
CE: What place do Caspian States (Azerbaijan, Kazakhstan, Iran, and Turkmenistan) hold in the foreign policy of Latvia?
Artis Pabriks: Latvia, as a member of the EU and the NATO, attaches great importance to co¬operation with its Eastern Neighbors, including the Caspian region. Currently we are most actively engaged with Kazakhstan and Azerbaijan. We have a rapid growing dynamics of our relations during the recent years - 2004 the President of Latvia Vaira Vike-Freiberga visited Kazakhstan, and 2005 - Azerbaijan; last year the first visits to Latvia of both the President of Kazakhstan and the President of Azerbaijan took place; since late 2004 we have our embassy in Astana, and in 2005 we opened our embassy in Baku. Simultaneously we have also very good and rapidly increasing bilateral economic relations, most notably in energy and transit/logistics. Many promising projects are being forged. Latvia's geographical location and its outstanding transit infrastructure is an ideal gateway into the EU market. Similarly, the understanding and expertise of the post-Soviet markets is one of Latvia's key competitive advantages within the EU.
Our bilateral trade with Kazakhstan reached more than 30 millions EUR and something around 6 millions EUR with Azerbaijan last year. And these figures are intensively growing just in last two or three years proving that there are still many possibilities to develop our economic relations.
We have intensive inter-parliamentary relations and sustainable contacts in different spheres - defense, economics, transit, finance, transportation, information technologies, education, health, and many others. We have also created a wide bilateral legal basis, especially during the last years.
I personally attach a great importance to people-to-people contacts between our countries and there is a good basis for it - Azeri and Kazakh minorities in Latvia, our embassies both in Astana and Baku, active diplomats of Azerbaijan and Kazakhstan in Riga, direct flights between Riga and Baku, and increasing mutual economic interests.
Azerbaijan also is a participant of the European Neighbourhood Policy. In this regard we are ready to promote Azerbaijan's co-operation with the EU and to share our reform experience what we gained during our European and Euro-Atlantic integration process.
CE: What do Latvia and the EU as a whole opine on expected gas supplies from the Caspian region?
Artis Pabriks: We strongly believe that the Caspian region has a huge role to play in the supply of gas to the EU. The completion of the Nabucco pipeline and other gas pipelines will play a significant part in securing that role. This role will only increase as the EU moves forward with creating an integrated gas and electricity network among its Member States and associated countries.
Thank you for the interview