Cablegate: Latvia's Elections: Little Change but Some Surprises

DE RUEHRA #0823/01 2831105
O 101105Z OCT 06




E.O. 12958: N/A

Ref: A) Riga 761 B) Riga 762 C) Riga 792 D) Riga 802

1. Summary: Latvia's October 7 parliamentary elections provided an
endorsement for the current minority government of PM Aigars
Kalvitis. The three parties in the current coalition won 51 seats
in the 100 seat Saeima (parliament), although they will likely
invite in a fourth party to add to the coalition's majority.
Kalvitis will almost certainly remain as PM and little change in
policy is expected as a result of the election. Center-right,
anti-corruption New Era did much better than polls had suggested,
but is likely to remain outside of government as it continues to
feel the effects of its decision to leave government last April.
The big surprise in the election was the unexpected success of the
leftist, Russian-oriented Harmony Center party and the poor showing
by its cousin PCTVL. In a change from previous elections where
there was significant segmentation between Latvia's two major ethnic
groups, Harmony Center appears to have drawn a significant number of
ethnic Latvian voters (25 - 33 percent of its votes) and the
conservative First Party appears to have done similarly well among
ethnic Russians. The new parliament will take office November 7,
although the current ministerial lineup could stay in place through
the NATO summit at the end of November. End summary.

2. Sixty-two percent of Latvia's 1.44 million eligible voters turned
out on October 7 to vote for their representatives in the Saeima.
With all votes counted and adjusting for the results in each of the
country's five multi-member districts, the Peoples' Party (TP) won
23 seats, Greens and Farmers (ZZS) 18, New Era (JL) 18, Harmony
Center (SC) 17, First Party (LPP) 10, Fatherland and Freedom (TB) 8,
and For Human Rights in a United Latvia (PCTVL) 6. The other twelve
parties on the ballot failed to receive the five percent of the vote
nationwide required to get in to Parliament. All seven of the
parties which won seats are represented in the current Saeima, which
also includes some independent members. Because of the complex
mechanics for allocating seats to individuals on the party lists, it
could be a week or more before we know exactly which individuals
from the parties have been elected to the parliament. (See Ref A
for details on the mechanics of the elections and ref B for synopses
of the parties).

3. Because PM Aigars Kalvitis' People's Party won the most seats, it
is likely that President Vike-Freiberga will offer him the first
opportunity to form a government. With TP's current coalition
parties ZZS and LPP the three would control 51 seats in the new
parliament, one more than a majority. While it is possible that the
current coalition would continue, it seems more likely that they
would seek to bolster their majority by adding another party to the
mix. The most likely new partner would be TB and its eight seats.
Although TB is nationalist in its orientation, especially on issues
related to Latvia's ethnic Russian community, its foreign policy is
pro-NATO, pro-US and pro-EU and its economic policy was rated
highest by mainline economists during the campaign. Even if the
current coalition were expanded to include TB, we see no major
changes in policy in the near term. Some ministers could change
however as portfolios are reallocated among the parties to reflect
the election results.

4. Other coalition arrangements would be possible by inviting New
Era into government. With 18 seats, it could supplant either ZZS or
LPP and the coalition would still have a majority, but we view this
possibility as unlikely. JL left government in April and criticized
the remaining parties for being weak in efforts to fight corruption.
JL's walkout and subsequent rhetoric did not endear it to the other
center-right parties and the chances of it being invited to join the
coalition are small. If it were invited in, it is unlikely that JL
would be offered the number and level of ministries commensurate
with the results it achieved in the elections and we judge it
unlikely they would come in on those terms.

5. The least likely coalition scenario would have either SC or PCTVL
join the government, but despite SC's seeming success in attracting
Latvian voters, we don't judge that Latvian politicians are ready
for this. Moreover, SC and PCTVL's leftist platforms on domestic,
social, economic, and foreign policy would make it very difficult to
find agreement with the center-right parties on a government agenda.
Meanwhile, it is likely that PCTVL will have to do some internal
thinking about what caused it to drop so much in popularity (it won
25 seats in the last election, although it fractured during the
course of the four year term, , but pre-election polls consistently
showed it as one of the top vote getters). SC will also need to do
some internal thinking to more clearly define itself since its low
pre-election poll numbers mean it was not subject to much press or
NGO scrutiny. For example, its platform lacked any mention of
foreign policy. Additionally, SC is a collection of several parties
with sometimes varying interests and it will be interesting to see
if they can hold together for the four year life of the parliament.

6. The new parliament will take its seats on November 7 and the
current government will formally resign that day. Even if the
coalition arrangements are completed by then, it is possible that
the current ministerial arrangements will stay in place through the
NATO summit November 28 - 29 to ensure continuity for that event.

RIGA 00000823 002 OF 002

7. The voting on election day proceeded without incident. Embassy
officers visited more than twenty five polling stations around the
country and reported no problems. The OSCE/ODIHR mission reported
that the elections were generally free and fair without any serious
violations or irregularities. However, the turnout was down from
the last elections in 2002 when nearly 71 percent of registered
voters participated.


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