The People's Republic of China and the Republic of Latvia have brand new relations. Diplomatic ties between two countries were established for the first time on 12 September 1991 after Latvia regained its independence from the Union of Soviet Socialist Republics. For the last 25 years both countries have been seeking common points of cultural, economic and political cooperation. China is becoming increasingly more important on the world economic and political stage, and Latvia is fulfilling its foreign policy goals by becoming a member of the European Union and NATO in 2004, a member of the Eurozone in 2014 and a member of the Organisation for Economic Co-operation and Development (OECD) in 2016.

 

Now, after both countries have established their place and relative influence in regional and/or global politics, a perspective on more intensive mutual collaboration emerges.When the priorities of the small Latvian diplomatic service have been fulfilled, new projects and more distant and ambitious relations can be built. Culture, diplomacy and economics are essential elements for good political relations between both state leaders and societies. Being geographically distant societies in Latvia and China perceive each other as an exotic location. The ability to channel this interest into practical cooperation is of the greatest importance.

 

Collaboration in the cultural and education sectors has been an item of growing interest for the Latvian population with respect to Chinese culture—and the Far East in general—over the last two decades. The establishment of a bilateral agreement on a scholarship system in 1996 that allows Latvian researchers and students to improve their language skills and cultural familiarity with China by visiting the country, as well as establishment of the Confucius Centre at Riga Stradins University in 2005 and the Confucius Institute at the University of Latvia in 2011, have all become structurally essential elements of Chinese-Latvian bilateral relations.

 

The intensification of cultural ties is attributable to more than only institutional structures and agreements. It is always about people who are willing to engage. The number of people with Chinese ethnicity has been increasing in Latvia over the past number of years. Currently there are 1,266 persons in Latvia identify themselves as Chinese. Out of those, four are citizens of Republic of Latvia.1In total there are 1,276 Chinese citizens in Latvia, constituting the seventh largest group of foreign citizens in the country.2The increase of Chinese citizens in Latvia should not be attributed solely to changes in the Immigration Law of 2011 allowing 5-year residence permits upon a substantial investment into the Latvian economy. It is also related to Latvia’s membership in the European Union and the possibility to satisfy the growing interests of the Latvian population about Chinese traditions, language, and cuisine.

 

Diplomatic relations between the two countries have been developing intensively, especially in recent years. Official visits at the parliamentary, ministerial and presidential levels have been frequent. The diverse character and increasing number of visits by officials and politicians, representatives of the non-governmental sector, and entrepreneurs demonstrate the strong interest of Latvians to explore cooperation possibilities with China and China itself. Realizing that Latvia’s political influence and economic size are relatively miniscule compared to China, the frequency and high level of visits indicates that there are good grounds for intensified partnerships.

 

The economic aspect is a separate issue. Latvia, being part of the European Union, follows the EU common customs and tariff policy with China. Here, again, Latvia is one of the decision makers. As one of the small member states of the EU, Latvia’s political influence can be described as “disproportionate” in comparison with the size of its trade, especially with China. China is the seventh largest import partner (at 3.73%) of Latvia, with 415 million euros worth of products, and only 21st largest (1.11%) export partner of Latvia, with 106 million euros worth of goods being exported.3

Trade numbers could be seen as promising, especially for the small Baltic state. However, official investment numbers demonstrate severe problems and a high potential for better mutual collaboration. While Latvia’s investments into China are only 140,000 euros, Chinese investments reach 5.78 million euros.4 Compared to national GDP, this constitutes 0.0003% and 0.006% of GDP respectively, making Chinese investments in Latvia 20 times larger than Latvian investments into China. This clearly demonstrates the need to promote and facilitate bilateral economic relations, as well as more generally popularize China in Latvia. Only by building the image of an approachable China can greater interest by Latvian businesses be achieved.

 

Two aspects that could be interesting for China and would facilitate mutual cooperation both at an entrepreneurial level as well as at a people-to-people level are education and tourism. Latvia has well-developed and internationalized tertiary education facilities—for instance, Riga Stradins University (formerly the Medical Academy of Latvia) can offer high-level education for Chinese students. The same stands for tourism. On the Environmental Performance Index, Latvia currently stands at 22nd place in total and 11th place regarding the purity of the water resources globally.5 With increased investment in eco-tourism over more than 10 years, Latvia has been providing attractive recreational possibilities for both Europeans and people from the former Soviet Union.

 

Finally, to better understand the future framework for collaboration, three things should be considered: the political and economic relationship between China and Latvia, the “One Belt, One Road” initiative, and, more specifically for Latvia, the “16+1” platform. This last cooperation initiative between China and 16 countries in Central and Eastern Europe is only gradually gaining momentum. Particularly in the Baltic states, due to their small size, engagement with China is becoming a topical issue only a few years after the launch of the initiative. Moreover, the “16+1” initiative is an actual opportunity for Latvia to popularize itself in China and vice-versa. Latvia’s growing interest in the project is tightly related to the fact that Latvia is hosting the summit of the heads of the “16+1” country governments in Riga in 2016.

 

To conclude, Latvian–Chinese bilateral relations are at an important stage. Rather intensive political relations will be continued, whether in the framework of the “16+1” platform

or bilaterally. Economic affairs and people-to-people relations are both fundamental elements for mutual benefit for both countries, and the whole Baltic region in general. But it is knowledge about one another and the understanding that sustainable relations are not based solely on economic calculation and geopolitical rationale that makes countries and societies trustworthy partners over the time.

 

1“Latvian Population by Nationality and Citizenship”, Office of Citizenship and Migration Affairs of the Republic of Latvia, Riga, 12 January 2016, http://www.pmlp.gov.lv/lv/assets/documents/statistika/IRD2016/ISVN_Latvija_pec_TTB_VPD.pdf

2“Distribution of Latvian Population by Citizenship”, Office of Citizenship and Migration Affairs of the Republic of Latvia, Riga, 12 January 2016, http://www.pmlp.gov.lv/lv/assets/documents/statistika/IRD2016/ISVP_Latvija_pec_VPD.pdf

3“Bilateral Relations between the Republic of Latvia and the People's Republic of China”, Ministry of Foreign Affairs of the Republic of Latvia, Riga, 8 April 2016, http://www.mfa.gov.lv/arpolitika/divpusejas-attiecibas/latvijas-un-kinas-tautas-republikas-attiecibas

4“Bilateral Relations between the Republic of Latvia and the People's Republic of China”, Ministry of Foreign Affairs of the Republic of Latvia, Riga, 8 April 2016, http://www.mfa.gov.lv/arpolitika/divpusejas-attiecibas/latvijas-un-kinas-tautas-republikas-attiecibas

5“Latvia. Country Overview. Environmental Performance Index”, Yale University, 2016,http://epi.yale.edu/country/latvia

(Karlis Bukovskis, Latvian Institute of International Affairs)