AGP Executive Report

Honorary Consuls in Riga: Latvia’s Foreign Ministry will host the 12th meeting of honorary consuls in Riga (July 13–15), bringing together 90+ honorary consuls from 44 countries, with talks on foreign policy, security priorities, and consular work plus a business networking event. Public Safety Upgrade: Latvia’s State Emergency Medical Service says all ambulance crews have received body armour and helmets, alongside new vehicles and support centres, to better protect staff amid crisis risks. Transport Planning: The Road Transport Administration says Latvia’s regional bus network is set to stay at its current scale in 2027, while it reviews where services can be optimized and presses for improvements to a commercial route strategy draft. Budget Pressure: Latvia’s Finance Ministry cut growth forecasts for 2026–27 and raised inflation projections, warning of wider budget deficits ahead and pointing to higher energy costs and uncertainty. NATO Air Defense Shift: NATO’s Baltic Air Policing mission is being upgraded into a true air defence mandate, giving fighter jets broader authority to intercept and, if needed, shoot down threats. Ukraine War Crimes Focus: OSCE-mandated experts say Russia is forcing about 1.6 million young Ukrainians into military indoctrination in occupied areas, potentially amounting to a crime against humanity. Regional Security & Migration: Lithuania reported a case of a French driver transporting 19 irregular migrants in a Bolt-branded van, with Latvia set to process and return the migrants. Culture & Diplomacy: Riga will host a major International Trombone Festival (July 29–Aug 1) with 500+ participants, while Latvia’s presence at Vilnius’ ArtVilnius’26 highlights Baltic cultural ties.

Baltic Air Defense Upgrade: NATO has shifted its Baltic Air Policing mission into a true air defense role, giving fighter jets broader authority to intercept and, if needed, shoot down hostile airborne targets over Lithuania, Latvia, and Estonia—an explicit response to the new reality of aerial threats near NATO’s borders. NATO Summit Finance Push (Latvia in the mix): Canada’s Mark Carney used the Ankara summit to launch the Defence, Security and Resilience Bank, backed by Canada plus Albania, Belgium, Greece, Latvia, Luxembourg, Romania, Turkey and Ukraine, aiming to raise up to $134bn for defense and security financing—though major G7 heavyweights remain hesitant. Latvia’s Budget Outlook: Latvia’s Finance Ministry cut growth forecasts for 2026–27 and raised inflation projections, warning of wider budget deficits and negative fiscal space, with defense spending assumed at 5% of GDP from 2027. Government Performance Check: Prime Minister Andris Kulbergs says only 3 of 61 priority tasks are fully done in the first month, with progress slowed by inherited fiscal issues and a cyberattack at Latvijas valsts meži. Border Pressure: Latvia’s border guard chief reports more undocumented crossings from Belarus and rising aggression, calling for greater military support. airBaltic Risk: Fitch placed airBaltic and its secured bonds on Negative Rating Watch, citing liquidity strain and higher default risk without additional support. Crime & Politics: The election commission removed a Harmony Centre candidate from the Saeima list after it found he lacks Latvian citizenship. Cyber/Industry: Latvia’s state forestry company LVM is still restoring systems after ransomware disruption.

NATO & Security: NATO leaders in Ankara agreed to upgrade Baltic air policing into an air defence mission, expanding pilots’ authority to destroy aerial threats, while also reaffirming Article 5 and pledging at least $140bn in military assistance to Ukraine; Latvia’s foreign ministry highlights the growing focus on drones, counter-drone systems, and hybrid threats. Latvia’s Border Pressure: Latvia’s border guard chief says attempts to cross illegally from Belarus have surged since April (7,634 this year), with smugglers more aggressive and calls growing for stronger military support. Latvia’s Government Watch: Prime Minister Andris Kulbergs says only three of 61 priority tasks are fully done in his first month, blaming inherited fiscal issues and disruptions including the Latvijas valsts meži cyberattack. Corruption & Justice: Prosecutor General Armīns Meisters warns Latvia’s anti-corruption drive is held back by a shortage of undercover operational officers, forcing reliance on other agencies. Defence Industry & Local Economy: SUBmerge Baltic signed a cooperation memo with France’s Naval Group to improve interoperability for underwater drones. Transport & Public Services: Railway platform modernization is running into major delays and cost overruns, with the Aizkraukle line hit hardest. State Companies: Kulbergs says airBaltic cannot operate without continued state funding and wants a new business plan; meanwhile two A220s have been returned early, shrinking the fleet to 54. Politics Beyond Latvia: Trump’s NATO summit remarks included a fresh Greenland push and a major policy shift: a US licence for Ukraine to manufacture Patriot systems.

Patriot License for Ukraine: At the NATO summit in Ankara, Donald Trump said the U.S. will license Ukraine to manufacture Patriot air defence systems, a major boost for Kyiv’s long-running push for local production. NATO Eastern Flank Upgrade: NATO is upgrading Baltic air policing into air defence, with wider authority to destroy threats, while also rolling out a digitized “Eastern Flank Deterrence Initiative” built around sensors, drones, satellites and AI. Latvia’s NATO Message: President Edgars Rinkēvičs told reporters Russia thrives on fear and intimidation, but Latvia is backed by NATO—plus he stressed Latvia already meets the 5% defence spending target. Riga Governance: Riga mayor Viesturs Kleinbergs survived an opposition attempt to oust him, after a vote failed to reach the needed support. Energy Market Pressure: Latvia’s pellet shortages are back, with the climate and energy minister calling the situation “absurd” and pushing producers to prioritize domestic supply and transparent pricing. EU Serbia Block: Eight EU states opposed opening Serbia’s next accession cluster, while Latvia was among capitals saying it was not fully convinced—keeping the process stuck. Railway Job Cuts: LDz Cargo plans layoffs of 300 employees amid changing rail freight volumes and higher Russian transit tariffs.

NATO Summit in Ankara: Latvian President Edgars Rinkēvičs urged allies to keep backing Ukraine and warned Russia “thrives on fear,” stressing Latvia’s exposure to hybrid attacks and the need to strengthen air defence and counter-drone capabilities. U.S. Troops in Latvia: Latvia’s Defence Ministry said there are no signs the U.S. plans to reduce forces stationed in Latvia, noting recent rotations and continued participation in NATO exercises. Defence Finance Push: Canada’s PM Mark Carney used the summit to advance the Defence, Security and Resilience Bank, with Latvia among the backers; Romania also announced it will host a regional office. Ukraine Air Defence: Norway pledged about €268m (NOK 3bn) for Patriot missile procurement and faster deliveries, while Zelenskyy said Patriot and interceptor supply will be a top summit priority. Latvian Election Promises: LETA reports Saeima platforms are packed with costly pledges, often without clear funding plans, as defence spending and broader social and healthcare commitments rise. Energy Grid Link: Lithuania, Latvia and Germany agreed to seek EU PCI status for the Baltic–German PowerLink undersea electricity project. Russia Messaging: Moscow again accused the Baltics of “playing with fire” over alleged hostile actions, including claims about deportations.

NATO Summit in Ankara: Canada’s PM Mark Carney announced a near-$1bn Ukraine aid package (about $900m total: $475m ammo plus 35 Canadian-made armoured vehicles) while Zelenskyy pressed again for air defence as Russia’s strikes continue. Baltic Defence & Spending: NATO estimates 2026 defence spending will top $1.8T, with Latvia among five allies projected to exceed 3.5% of GDP on core defence. New Multinational Financing: Canada and eight partners (including Latvia) backed a Canada-led Defence, Security and Resilience Bank to mobilize up to £100bn in low-cost financing, aiming to start operations in 2027. Air & Drone Cooperation: Ukraine signed drone pacts with Estonia and the Netherlands; separately, nine EU states urged the Commission to speed up buying US air-defence missiles for Ukraine using the €90bn package. Industrial Deals for NATO: NATO said at least $50bn in new defence contracts were announced, including Saab GlobalEye replacing the E-3 AWACS fleet. Latvia at Home: The government approved changes to modernize international road transport controls via electronic permits, and funded Latvia’s National Library upgrades for the 2028 EU Council Presidency. Russia & Security Signals: A NATO official said there’s no sign Russia plans an imminent attack on the Alliance, while Baltic reporting notes no concrete provocation plan has been identified.

NATO Counter-Drone Push: NATO says it will invest over $40bn in Ankara to expand counter-drone defenses, drone procurement and operator training, aiming to scale detection and defeat of unmanned threats. Air Surveillance Upgrade: Eleven NATO allies, including Latvia, have agreed to jointly procure Saab GlobalEye to replace part of the aging E-3 AWACS fleet, boosting multi-domain early warning. Nuclear Deterrence Legal Shift: Lithuania moves to lift its constitutional nuclear ban, seeking to remove Article 137 so NATO nuclear deterrence integration can be legally possible. Latvia’s Foreign Bribery Oversight: The OECD says Latvia improved its foreign bribery frameworks and enforcement, including sanctions and new trial proceedings, but urges more work on detection strategy and whistleblower protections. Free Press Principle: Latvia’s media Ombudsman backs LSM’s editorial right not to cover a ministry-linked construction conference, reinforcing editorial independence. Government Delivery Limits: Prime Minister Andris Kulbergs admits the coalition likely won’t deliver everything in its declaration, blaming process-heavy administration and day-to-day issues. Riga Public Services Strain: Over 100 regional bus trips near Riga were cancelled due to a driver shortage, with sick leave hitting service capacity. Health Rights After Shooting Case: The Ombudsman questions whether patient rights were fully respected after a bullet was not removed at first, then later removed elsewhere. Return Migration Study: University of Latvia researchers propose a model of “remigration” stress and adaptation, highlighting that the hardest strain can start before people even pack to come home. Latvian Politics & Security: Four Saeima candidates disclosed past collaboration with USSR or foreign security services, while a separate case continues to probe Latvia-linked Russian espionage networks.

NATO Summit Pressure: The US is urging allies to move faster toward the 5% of GDP defense-spending goal ahead of Ankara, with Matt Whitaker pointing to the Baltics as leaders while warning others to “step up immediately.” Latvia’s AirBaltic Watch: Prime Minister Andris Kulbergs says the state won’t fund airBaltic again without a revised business plan and “ironclad” clarity on routes and a strategic investor. Security & Espionage: Latvia’s State Security Service says four Latvian citizens are accused of spying for Russia via “Baltic Antifascists,” including alleged intel on NAF locations and Riga Airport security. Spyware Accountability: Civil society and MEPs are demanding EU action after Citizen Lab reported Pegasus infections of PEGA committee member Stelios Kouloglou in 2022 and 2023, raising alarms about parliamentary oversight. Ukraine Drone Diplomacy: Kyiv says it aims to sign drone-related defense agreements with at least seven NATO states by year-end, with Latvia already among the partners. Public Services Strain: Riga-area bus trips were cancelled in bulk due to a driver shortage, with the operator citing sick leave and a shrinking workforce.

NATO Summit Fallout: Ahead of the Ankara meeting, Kyiv says Russian strikes killed 14 in overnight attacks on Kyiv, while NATO allies debate unity and defense spending as Eastern Europe prepares for “first days alone.” Latvia Security: Latvia’s State Security Service (VDD) has asked prosecutors to pursue four Latvian suspects accused of collecting intelligence for Russia via the pro-Kremlin Baltic Antifascists, including details on Riga Airport and border/defense measures. Policing Accountability: Latvia’s Internal Security Bureau has referred a case to prosecutors over alleged abuse of authority by three Rīga State Police officials, including unjustified stun-gun use. Public Media Row: Latvian Public Media (LSM) says it reached a compromise after backlash over rebranding, keeping Latvian Radio and Latvian Television brand names for now. Elections Watch: LETA analysis of Saeima candidate lists finds the pool is smaller, older, and more academically credentialed than in 2022. Cross-border Crime: Irish and Latvian police, with Europol and Eurojust, dismantled a gangmaster network tied to labour exploitation of Latvian workers in Ireland. Business & Transport: Gategroup expands in the Baltics by acquiring airline catering and onboard retail operations in Riga and Tallinn. EU/Travel Rules: A new EU directive banning extra seat-selection fees is already causing disputes, including an airBaltic case involving a six-year-old seated away from parents.

NATO Summit Focus: Ahead of the July 7-8 Ankara summit, NATO diplomats and leaders are stressing unity and solidarity while arguing over defence spending and burden-sharing—with Latvia’s ambassador saying allies must turn commitments into concrete steps. Baltic Security Signals: German Chancellor Friedrich Merz met Baltic leaders to underline Germany’s role on NATO’s eastern flank, as Estonia’s PM says Russia is weaker than for years and calls for sustained pressure. Latvia–Russia Trade Impact: Latvia’s Economy Ministry says Russia’s closure of the Karsava–Pytalovo rail crossing won’t hit the economy much, noting rail freight with Russia is down about 92% since 2019. Latvia–Estonia Cooperation: Latvia’s president opened a Tallinn business forum where the two countries signed a memorandum on supply security and strategic reserves, aimed at better crisis coordination. Ukraine Drone Context: Russia’s deputy foreign minister claims Baltic states have provided air corridors for Ukrainian drones, as Ukraine confirms strikes on Russian oil infrastructure. Local/Regional Governance: Estonia banned concerts by a performer linked to a pro-Russian rapper, showing how cultural policy is being pulled into the security debate.

NATO Ankara Summit: NATO diplomats and ambassadors in Turkey are pushing a clear message of “unity and solidarity” ahead of the July 6-7 Ankara Summit, with Latvia’s envoy stressing that allies must turn last year’s 5% defence spending pledge into real capabilities and keep Article 5 and support for Ukraine at the center. Latvia-Russia Trade: Latvia’s Economy Ministry says Russia’s closure of the Karsava–Pytalovo rail crossing won’t hit the economy much, but it underlines a broader geopolitical squeeze as rail freight with Russia has already fallen by nearly 92% since 2019. Baltic Security Warnings: Poland’s PM Donald Tusk says concerns are rising about a possible Russian “provocation” in the coming months, while UK officials reiterate they will defend NATO territory “every inch,” after US warnings to Warsaw about drone/missile or hybrid scenarios. Ukraine Drone Spillover: Russia claims it has verified that Latvia and other Baltic states provided air corridors for Ukrainian drones hitting civilian infrastructure, as the drone war keeps spilling into NATO airspace. Latvia-Italy Ties: Italy’s outgoing ambassador met Latvia’s Saeima Speaker Daiga Mierina, praising Italian troops in Latvia’s NATO brigade and calling for deeper defence-industry cooperation. Border Pressure: Estonia reports heavier summer border queues, with bus traffic and stricter inspections slowing crossings at Koidula and Luhamaa. EU Legal/Integrity: Latvia and other Baltic states are among those blocking Serbia’s EU accession talks over rule-of-law concerns.

NATO Summit Prep: Ahead of the July 7-8 Ankara summit, NATO diplomats and ambassadors in Turkey are pushing a single message: unity and solidarity, with Latvia’s envoy stressing concrete delivery of the 5% defence spending pledge starting in 2027. Baltic Security Tensions: Polish PM Donald Tusk warns that Russia may try to test NATO’s reaction via an armed provocation in coming months, with concerns flagged for the Baltics; the UK also says it will defend every inch of NATO territory. Latvia-Russia Trade Shock: Latvia’s Economy Ministry says Russia’s closure of the Karsava–Pytalovo rail border crossing won’t hit the economy much, but it underlines a broader geopolitical shrinkage of EU-Russia transport links as rail freight with Russia has already fallen about 92% since 2019. Ukraine Tech and Drones: Ukraine confirms it has received the NSM coastal missile system, while Russia claims Baltic states enabled Ukrainian drone air corridors—a dispute that keeps fueling hybrid-threat talk. Cyber and Governance: Latvia’s state forests cyberattack investigation points to another company being identified, and Latvia’s Ombudsman urges stronger protection of property from unauthorised business activity. EU Legal/Rule-of-Law: The Netherlands opposes opening EU accession Cluster 3 for Serbia over rule-of-law concerns, with several states including Latvia backing the block.

Baltic Security & Ukraine Drones: Russia’s deputy foreign minister claims Latvia and other Baltic states provided “air corridors” for Ukrainian drone strikes, renewing pressure on Riga as it also faces reports of a planned drone factory near the border. NATO Summit Prep: Germany’s Chancellor Merz met Baltic leaders ahead of the Ankara NATO summit, with President Rinkēvičs stressing turning the 5% GDP pledge into real capabilities, keeping Article 5 unity, and countering Russian and Belarusian hybrid threats. Poland Provocation Watch: Multiple reports say the US warned Warsaw about a possible limited Russian “hybrid” provocation—drone or missile attacks on infrastructure or a border incident—to test NATO resolve and weaken support for Ukraine. Latvia–EU Legal Cooperation: Latvia’s Council of Sworn Advocates signed a cooperation deal with Lexu AI to promote responsible, secure AI use in legal work. Cyber & Infrastructure: Latvia’s state forests investigation continues to draw attention after reports of a hacker staying undetected for days and further attacks tied to the case. EU Crypto Regulation: ESMA updated its MiCA register, adding 37 licensed crypto-asset providers, including one Latvian firm. Diplomatic Ties: Italy’s ambassador to Riga met Parliament Speaker Daiga Mierina, highlighting defense cooperation and Italian participation in Latvia’s NATO brigade.

Baltic Security Watch: The US has reportedly warned Poland that Russia may stage an armed “provocation” to test NATO’s resolve—using drones or missiles against critical infrastructure, simulated air strikes to trigger air defences, or even a limited border incursion from Kaliningrad or Belarus—aimed at driving wedges inside the alliance and pressuring allies to cut support for Ukraine. Latvia–Estonia Cooperation: Latvia and Estonia move to coordinate on strategic reserves, with a memorandum setting up closer crisis planning and information exchange. NATO Summit Context: Ahead of the Ankara summit, debates over defence spending and transatlantic unity keep sharpening, with Baltic leaders pushing for stronger deterrence. Cybersecurity: Cert.lv says the same ransomware actor behind the Latvijas valsts meži breach also hit pharmaceutical firm Olpha, with unauthorised access to at least one server and deleted logs detected. Legal Tech: Latvia’s Council of Sworn Advocates signs a cooperation deal with Lexu AI to promote responsible, secure AI use in legal work. Crypto Regulation: ESMA updates its MiCA register, adding 37 licensed crypto-asset providers, including one Latvia-linked authorisation. Elections: With three months to Latvia’s parliamentary vote, polling shows the United List and Latvia First tied at the top, while other parties jockey for position.

EU Defence Budget Debate: Estonia’s PM warns that failing to deter Putin will cost more than paying for defence, as EU leaders prepare for multiple summits including the Ankara meeting with the US. Baltic Security & Supplies: Latvia and Estonia sign a memorandum to cooperate on supply security and strategic state reserves, with a 2026–2028 action plan. Border Pressure in Latvia: Latvia’s border guard says it can’t always intercept every illegal crossing on the Belarus route when several incidents happen at once, and enhanced border security has been extended. Cybersecurity Watch: Cert.lv says the same ransomware threat actor behind the Latvijas valsts meži attack also compromised a server at pharma firm Olpha, while Sadales tīkls reports daily cyberattack attempts. Russia–NATO Tensions: The US warns Russia is plotting a provocation on Poland to test NATO resolve, with Polish officials also discussing possible “false flag” scenarios. Property Curbs on Russians/Belarusians: Estonia approves a bill restricting real estate purchases by Russian and Belarusian citizens and controlled entities without long-term residence permits. Public Health: A salmonella outbreak linked to flavoured instant noodles has spread across 14 countries, including Latvia. Economy & Markets: Latvia’s new car market declines slightly in early 2026, with experts pointing to the end of government support for greener vehicles as a key factor.

Latvian Security & Borders: Latvia extended enhanced border security along the Latvian–Belarusian line until Dec. 31, citing tens of thousands of prevented illegal crossings since 2021 and continued pressure in Ludza, Krāslava, Daugavpils and Rēzekne areas. Cyber & State Systems: Prime Minister Andris Kulbergs said a hacker stayed inside “Latvijas valsts meži” for days before active operations, with the government now questioning why detection tools and a cybersecurity audit missed the problem. Elections Preparedness: Latvia’s Central Election Commission outlined emergency procedures for polling stations, prioritising staff and voter safety during threats like air raids while aiming to keep voting running. Energy & Resilience: Ukraine reported rapid progress on restoring capacity and boosting decentralized generation, while Latvia’s electricity network operator said it faces cyberattacks every day—repelled so far, but requiring ongoing investment. NATO & Regional Defence: Latvia’s land forces are set under new NATO command structures on the eastern flank, as Ankara summit talks focus on defence spending and readiness. Legal & Property Rights: The Ombudsman warned Latvia’s business registration rules can leave property owners exposed when unauthorised parties register a company at their address. International Developments: Russia temporarily closed multiple rail border crossings with Finland, Estonia and Latvia, disrupting passenger and freight movement.