Latvian Political Monitor

Ha, ZZS has gone into pre-election hysteria and now offers anything at all. Even things that are illegal. Goal – to promise Lenin's logs to the people. Who doesn't want money for themselves? Everyone does. They offer to drop VAT on fuel. I'm not even talking about the fact that then any budget will fall apart, even while continuing to borrow maximally. Ratings threaten to throw the party out of the Saeima, and then – who cares about the budget? I'm talking about the fact that reducing VAT on fuel is not allowed in the European Union. When the Poles and Spaniards tried, they immediately launched a fiscal violation procedure. They now sadly promise to fix things. But. As some Repše said – well, how can one not promise? 🫠

Following my proposal, it has been decided that starting from 2027, information on procurements carried out by the state and other public institutions must be published regardless of the transaction or contract amount. Transparency helps promote responsible management and reduce the risk of wasteful spending.

Logically structured explanation about AB & C11👌

This morning at 7:00 I gave an interview to @LRZinas while being in Lapland at the Arctic Summit, an EU leaders' event. It surprises me that instead of the Latvian public learning about the decisions we are making to strengthen security against Russian threats, my 1:1 discussions with German Chancellor Merz about the EU's new 7-year budget, about the common agreement of Baltic leaders to solve the RailBaltica issue, about Iceland's EU referendum or the general EU position in the Arctic in the fight for natural resources and the new northern sea transport corridor... all that journalists are interested in is Uzulnieks being caught drunk, whether ministers use drugs, and why I hold a glass of beer at a basketball game... I believe you can do better 😉

@_emma_karkls_ Those are salary taxes to the State Revenue Service. You can check in the company's financial statements - they generally haven't paid any other taxes for years, or ever, as far as I remember.

I'm flying home from the 2nd Lapland Arctic Summit, where together with all the Nordic, Baltic, Icelandic, German, and French leaders we had a heated, important discussion about the strategic importance of the Arctic, security, the Russian threat, EU interests, and reducing dependency on resource extraction. Together with Estonia and Lithuania, we are united in defending the interests of the Baltic states.

@KristopansVilis I had heard such a narrative, but considered it nonsense. And I have expressed my position more than once. What other 'table' is there, if it has been publicly stated that little depends on the state? Let everyone drill their own table, it is not for me.

Those 42 million, for example, are for CO2 quotas. The company buys them on the ETS market in Europe and submits them to LVĢMC (the local ETS administrator). These quotas are cancelled, they give no income to the budget. Green Deal obligations. The rest are liabilities, but their actual recoverability without the initiated process is practically zero. In the context of the national economy, it is better for the company to fly. The alternative was not flying. I really don't know what's 'funny' about that.

That is our legislator's choice. Basically the same throughout the EU. Practically all sectors are funded from excise and VAT, including defense, health, education. Even part of pensions (service pensions and bonuses for length of service, for example).

Here is a more detailed press release about airBaltic Chapter 11 restructuring https://t.co/M5SQBgg4Hv

@IvarsRimsa Long gone. Burned long ago. You cannot recover burned stubble. The last crumb of 30 million was given in spring and went there, to pay bills.

My statement on airBaltic Today, airBaltic is initiating financial restructuring in a US court under Chapter 11. This time we are not buying a few more months of life support for the airline. We are beginning to solve problems at their core. It must be admitted that negotiations with bondholders were not progressing. Several investors, who had bought the bonds on the exchange at about 70 percent of their nominal value, were more reliant on airBaltic's liquidation and recovery of pledged assets rather than on restructuring the company. Another loan of up to 257 million euros at an annual rate of 25% was offered. That could provide the company with money for the near term, but would not solve either the previously accumulated debt or the problem of aircraft lease obligations. Therefore, I did not accept this offer as a long-term solution. Chapter 11 is a US court-supervised financial restructuring that allows airBaltic to continue flying while restructuring debts and lease agreements and attracting the financing needed for operations. Simply put, it is a protective shield that gives the company time and legal protection against creditor claims, allowing management to implement a full restructuring plan. This does not yet mean that all of airBaltic's problems are solved. But this is one of the best currently possible solutions to ensure the company's viability and give it the chance to stand on its own feet. For the process, airBaltic has received commitments from financiers to provide 350 million euros in new financing at a 12% rate. International financial market participants such as banks Morgan Stanley, Barclays, and private financiers Hayfin Capital Management, Oaktree Capital, and Strategic Value Partners have expressed readiness to finance. This is a significant and positive signal of trust. At the same time, I have instructed the Ministry of Transport to declassify restricted government documents related to airBaltic, so that the public finally has full information about the decisions made within the company, the use of state money, and the consequences of those decisions. The most important news for passengers is that airBaltic continues operations, the planes continue flying, and purchased tickets remain valid. This is not yet the finish and not a victory statement. But a process that addresses airBaltic's problems at their core has finally begun.

On Father's Day I go to Lapland to represent 🇱🇻 at the 🇪🇺 Arctic Summit, where Nordic and European leaders will meet to address security and the new 🇪🇺 MFF multi-annual budget issues. I will defend 🇱🇻's position on our role as an EU border state on the eastern flank in strengthening the EU border, investment in defense and the need to strengthen the border economy with an additional €7 billion in funding.

@VisockisJuris The opposite. First the masses must be educated. So that 50+ of those who will vote for a technically feasible thing are elected. Technically, that is called a budget. I have a plan, but it is unpopular. So far only Argentina has implemented it.

Both are happening. The bases were reduced by about 50 mio already before us. And it continues. Next year around 300mio. Which has already been eaten up by politicians' truly unchanged spending demands. Very healthy appetite. Indeed. But all this is largely pointless. Who will respond to my call to FINALLY go to courses?

Here's one concrete example, two. I'm talking about 'my' current ministry, where I have more direct daily experience. VID, an institution under the Finance Ministry, recently reduced its headcount by more than 1000. Now 2800, down from about 4k. Is that 'nothing'? The Finance Ministry itself has remained at around 250 employees, even though a host of duties has been added over the years. Is that nothing? And average salaries are not the highest, there's this KEM asking someone to bring coffee. And yes, I understand the popular negativity. Against bankers (traditionally) and what is the Finance Ministry in state administration? Essentially the same kind of accountants, state financiers. By definition they are and will be the bad guys. Because 'bankers'. I knew that from day one, I formulated it that way and urged accepting it as an inevitable given, I put on the usual uniform. You see, for 25 years I also owned an accounting firm. Before I sold the business, it was relatively large. Thousands of clients over the years. And sometimes clients had exactly the same attitude. For me it's like stepping into familiar slippers. I know this industry well, I understand. With one exception. My task as a manager was always to defend accountants from humiliation by business owners. Sometimes they allowed themselves too much. Over time it became such that they would cite me - they'd have to talk to Guntars. And eventually clients understood it was time to stop the mobbing. But I can't stop the public mobbing of the Finance Ministry right now. The employer is not a business owner whose choices are nevertheless rational. Here there is a frenzied crowd.