AGP Executive Report

Latvian Investment Push: Latvia’s Investment and Development Agency (LIAA) says it has reached nearly 90% of its 2026 investment attraction target in nine months, with €886.8m in secured project value spanning energy, defence/dual-use, fintech, logistics and real estate. SAF & Biofuels Industry: NorSAF will partner with Nova Pangaea Technologies to build an ethanol plant in Latvia using locally sourced wood waste to feed sustainable aviation fuel production. EU Budget Fight for Farmers & Regions: Seventeen EU countries, including Latvia, signed a letter urging the bloc to protect cohesion policy and the Common Agricultural Policy from cuts in the 2028–2034 budget talks. Eurozone Cost Pressure: Eurostat reports eurozone inflation jumped to 3.8% in September, driven mainly by energy, while Latvia’s rate is cited at 2.9%. Security & Industry Context: NATO tested a new air defence framework over Lithuania and Latvia with integrated air and missile defence drills, including a US B-1B bomber—highlighting the region’s defence-linked industrial priorities.

Aviation Biofuels Push: NorSAF and Nova Pangaea Technologies plan an ethanol plant in Latvia using locally sourced wood waste to feed sustainable aviation fuel (SAF) targets. Rail Baltica Cost Control: Latvia’s government set a maximum Rail Baltica cost ceiling of €20m per kilometre for the main line, after earlier figures reportedly ran €28–32m/km. Eurozone Inflation Watch: Eurostat put eurozone inflation at 3.8% in September, driven mainly by energy (+18.8% y/y), with Latvia at 2.9%—a sign of uneven pressure across the bloc. Defence Industry & Drones: Czech forces showcased drone and anti-drone tech at Drone Shield 2026, with NATO observers including Latvia. Baltic Security Drills: UK Royal Marines trained in the Faroe Islands, rehearsing action around the Greenland–Iceland–UK gap and protection of undersea cables. EU Energy Cross-Border Renewables: Three new projects (including Ukraine wind and an Austria–Germany geothermal heat network) gained CB RES status, unlocking EU support for studies and works. airBaltic Milestone: airBaltic marked 31 years since its first Riga–Stockholm flight, now serving 70+ destinations.

Latvia’s Defence & Industry: Latvia is set to receive the first IRIS-T medium-range air defence systems later this year, with operational combat duty possible in the first half of next year, while work continues on integrating BLAZE interceptor drones near the eastern border. Counter-drone Deal: Anduril and Latvian startup ORIGIN will fuse ORIGIN’s BLAZE interceptor with Anduril’s Lattice AI command-and-control to build layered drone defence for NATO’s eastern flank. Artillery Procurement: Latvia signed a three-way contract for Czech-made Morana 155mm wheeled howitzers and rocket artillery, using EU SAFE loans and a plan to shift part of production to Latvia. EU Policy & Compliance: The European Commission opened a consumer credit infringement case, giving Spain two months to transpose new EU rules or face court and penalties; it also published key infringement decisions across policy areas. Public Media Language: Latvia restricted public media Russian broadcasting from Jan 1 to exceptional cases, with potential staffing impacts. Business & Innovation: Riga Nordic University launched an international journal on interdisciplinary applied sciences, and Riga-based Trace.Space unveiled Trinity, a platform to help hardware teams scale from prototypes to production. Security & Politics: Latvia detained two citizens suspected of spying for Russia’s GRU, and election campaigning is increasingly shaped by security concerns.

Defense & Security Procurement: Latvia could start using IRIS-T medium-range air defence in operational combat duty in the first half of 2027, with initial acceptance work beginning later this year, while work continues on integrating drone interceptors like ORIGIN’s BLAZE with Anduril’s Lattice AI command-and-control for layered counter-drone defence. Parliament & Media Policy: The Saeima has restricted public media Russian-language broadcasting from Jan 1 to exceptional cases only, with disinformation rebuttals as a narrow exception. Cybersecurity & Risk Management: CERT.LV data shows Latvia’s cyber threat environment stayed under “red alert” over summer, with a notable share of attacks causing significant business and state impacts, and experts warn cybersecurity must be treated as organisational risk, not just an IT issue. Industrial Tech & Startups: Riga-based Trace.Space launched Trinity, aiming to connect engineering requirements, testing and variants so hardware teams can scale from prototypes to production. Local Business & Consumer Impact: Amber Latvijas Balzams remains in the red in H1 2026 as volumes and revenue fall sharply amid weaker purchasing power and excise pressures. International Trade & Growth: Latvia’s MFA and EU partners promoted Global Gateway and EU Tech Business Offer tools to help Latvian firms find partners and expand exports. Food & Supply Controls: Latvia moved to tighten checks on Russian and Belarusian food and grain flows, including broader Russian food bans.

Defence Procurement & Industry: Latvia is moving closer to long-range strike capability, with reports that it plans to buy Anduril’s Barracuda cruise missiles and, separately, signs to acquire the Czech-Slovak “Morana” 155mm artillery system under a trilateral deal that also targets gradual localization in Latvia. Security & Hybrid Threats: President Edgars Rinkēvičs said Latvia has no indication Russia will directly invade NATO members, but warned of ongoing provocations and cyberattacks; Estonia meanwhile attributed an arson attack on Milrem Robotics to Russian special services, underscoring the risk to defence supply chains. International Cooperation & Public Diplomacy: Latvia’s International Image Policy Coordination Council resumed work to build a unified national image strategy for 2027–2031, including preparations for Latvia’s EU Council Presidency in 2028. Energy & Costs: Saeima is set to approve a fuel cost cut by suspending a safety reserve service fee through end-2026, aiming to lower prices for drivers and logistics, agriculture and manufacturing. Business Support: LIAA’s autumn 2026 Business Incubation Programme hit a record 313 applications, signaling strong demand for export- and innovation-focused growth help. Infrastructure & Services: Riga Airport advanced its €98m terminal expansion, while district heating and water metering rules from 2027 are pushing operators toward remote-read systems.

Latvia Security Outlook: President Edgars Rinkēvičs says Latvia currently has no signs of a direct Russian invasion of NATO states, but warns of ongoing Russian provocations and cyberattacks, urging the public to report suspicious activity. Baltic Defence Industry Under Fire: Estonia attributes the August arson at Milrem Robotics in Tallinn to Russian special services, summoning Russia’s chargé d’affaires; Latvia’s authorities had detained suspects and handed them over. Fuel Costs Relief: Latvia’s Saeima is set to approve a temporary suspension of a fuel safety reserve service fee, aimed at lowering prices for drivers and cutting costs for transport, logistics, agriculture and manufacturing. Trade & Supply Chain Pressure: Latvian transit checks tighten as grain shipments from Russia and Belarus rise; customs and the Food and Veterinary Service are testing cargo for grain stolen from Ukraine. Business Support Record: LIAA’s Business Incubation Programme hit a new high with 313 applications for the autumn intake. Culture & Heritage Funding: The Cabinet reallocates €4.35m to complete the Great Guild Hall and Riga’s “Arsenāls” exhibition hall refurbishment.

Defence Procurement: Latvia plans to buy U.S. Anduril Barracuda long-range cruise missiles, with President Edgars Rinkēvičs announcing the move after a visit to Anduril in the US; details on versions, quantities and timing are still unclear. Baltic Security & Industry: Estonia says Russia ordered an arson attack on Milrem Robotics in Tallinn, part of a wider sabotage campaign; Estonia detained Latvian suspects and summoned Russia’s chargé d’affaires, while NATO and EU leaders backed Tallinn. Trade & High-Tech Cooperation: Latvia’s LIAA US trade mission wrapped up with 44 companies and partners signing defence-technology and genomics agreements, aiming at joint development, testing, manufacturing and precision-medicine projects. Agri-Food Supply Chains: Latvia is tightening checks on grain transit after reports of rapidly growing Russian and Belarusian shipments; customs and food authorities are sampling cargo to test for grain stolen from Ukraine. Business & Logistics: Venipak invested over €2.5m in Baltic infrastructure and expanded parcel locker capacity in Latvia by 15%. Agri-Food Results: Agrova Baltics reported strong H1 2026 growth, with revenue up 51.7% to €15.2m and profit rising to €3.95m, driven by capacity utilisation and cage-free expansion. Retail Demand: Latvia’s retail trade turnover rose in August, with mail/internet sales and pharma leading growth.

Baltic Security: Estonia says Russia ordered an August arson attack on Milrem Robotics, a drone-maker supplying Ukraine, and EU/NATO leaders rallied behind Tallinn after suspects were detained and Moscow rejected the claims. Food & Trade Security: Latvia, alongside Lithuania and Estonia, is tightening checks to stop Russian-stolen Ukrainian grain entering markets, including lab testing of samples and a push for a regional verification scheme. Agri-Food Business: Agrova Baltics reported a 52% revenue jump in H1 2026 to EUR 15.2m and profit of EUR 3.95m, driven by higher egg volumes and ongoing capacity expansion toward more cage-free production. Riga Finance & Offices: Nordic Investment Bank signed a long-term lease at Origo One, reinforcing Riga’s Central Business District as a growing Baltic finance hub. Fuel Costs Policy: Latvia’s Saeima advanced amendments that could temporarily suspend a fuel security reserve fee, aiming to cut pump prices, while other tax relief ideas stalled.

Latvia Defence Procurement: Latvia is moving to buy Anduril’s Barracuda jet-powered cruise missiles for long-range strike capability, while Origin Robotics will integrate Anduril’s Lattice command-and-control into its BLAZE autonomous drone interceptor for counter-UAS testing. Baltic Security Planning: Lithuania and Poland are drafting civilian evacuation frameworks for a worst-case war scenario, focused on the Suwałki corridor and logistics for cross-border movement. Energy Costs Pressure: Record EU diesel prices are driving up freight costs and squeezing farmers and businesses, raising inflation risks across supply chains. Banking & Russia Exit Watch: OTP Bank says it is reviewing whether to exit Russia as ECB scrutiny grows around its Baltic lender acquisition of Luminor. Logistics Modernisation: Venipak is expanding parcel locker capacity in Latvia by about 15% with €2.5m+ investment, alongside automation upgrades across the Baltics. Latvian Industry Export Strength: Latvia’s fibre-optic sector, centered in Latgalia, produces around 20m metres of optical fibre annually and exports to 50+ countries. EU Energy Rule Compliance: The European Commission has opened infringement cases over energy-sharing and supplier-choice rules, including Latvia.

Logistics & Retail Fulfilment: Venipak is pouring over €2.5m into Baltic infrastructure and has boosted parcel locker capacity in Latvia by about 15%, adding compartments where demand peaks. EU Energy Rules: The European Commission has opened infringement cases against 18 EU states, including Latvia, for not fully transposing the new energy-sharing and supplier-choice rules by the July 17 deadline. Defence Industry & Procurement: EU defence ministers have formally named the first five European Defence Projects of Common Interest, covering drones/counter-drones, maritime/seabed defence, space, federated air & missile defence, and eastern-flank surveillance—aimed at scaling industrial coalitions. Baltic Mobility: Lithuania says it will still target Rail Baltica completion by 2030, even as the Baltic states extend the first phase deadline to 2034. Security & Civil Preparedness: Latvia’s security service says it’s monitoring the election campaign for disinformation and possible provocations, while NATO states prepare evacuation planning tied to the Suwałki corridor. Energy & Heating Costs: Latvia is also facing higher heating costs this winter, with pressure coming from fuel prices and shifting heating options. Culture & Film Industry: Tallinn’s Black Nights Film Festival opens its 30th edition on Nov. 6 with “Ulya,” a Latvia–Estonia–Poland–Lithuania co-production that premiered at Cannes.

Baltic Security Planning: Latvia is moving from warnings to action as NATO allies draft evacuation frameworks tied to the Suwałki Gap, with Lithuania and Poland working on cross-border procedures that could move residents of Lithuania, Latvia and Estonia into Poland during a crisis. Hybrid Sabotage: Latvia confirmed deliberate sabotage of its “smart border” surveillance build—cut cables, damaged cabinets and equipment—showing how grey-zone attacks are already disrupting critical infrastructure. Defense Procurement: Latvia is set to acquire Anduril’s Barracuda long-range cruise missiles after President Edgars Rinkēvičs’ U.S. visit, aiming to close a long-range strike gap. EU Energy Rules: The European Commission opened infringement proceedings against Latvia and others over incomplete electricity, hydrogen and gas market rule transposition. Logistics & Retail: DHL eCommerce is seeking more Eastern Europe acquisitions, including connecting Venipak’s Baltics parcel lockers and delivery network to its international system; meanwhile “Lidl Latvija” reported 2025 turnover up 7.5% to €495.6m with continued investment. Research & Industry: Latvia’s genomics delegation is in California to build partnerships for technology commercialisation and joint development.

Baltic Security & Defense: Latvia is moving to buy Anduril’s Barracuda long-range cruise missiles, with President Edgars Rinkēvičs saying memoranda were signed during a U.S. visit—potentially making Latvia the first Baltic state with this strike reach. Hybrid Threats: Latvia confirmed deliberate sabotage of its “smart border” surveillance build, including cut cables and damaged video equipment—another sign Russia’s grey-zone pressure is turning into direct disruption. Civil Preparedness: Lithuania and Poland are preparing a cross-border population evacuation plan for Latvia, Lithuania and Estonia if war escalates, with exercises testing warning, transport and border-control procedures. Logistics & Retail: DHL eCommerce is seeking more acquisitions in Eastern Europe, including its planned purchase of Venipak to expand parcel lockers and domestic delivery in Latvia, Lithuania and Estonia. Food & Trade: Latvia tightened checks on grain transit amid concerns about stolen Ukrainian grain moving through the country. Energy Regulation: The EU opened infringement proceedings against Latvia and others over incomplete electricity, hydrogen and gas market rule transposition. Retail Numbers: “Lidl Latvija” turnover rose 7.5% in 2025 to €495.6m, as the company continued its investment phase.

Defense & Tech Procurement: Latvia is moving fast on counter-drone and long-range strike capabilities, with Anduril and ORIGIN signing a MoU to assess layered counter-UAS integration for NATO’s eastern flank, while Latvia also looks set to order Anduril’s Barracuda long-range cruise missiles. Food & Border Security: The Saeima has tightened rules for third-country grain transit, empowering the Food and Veterinary Service to inspect and sample cargo to stop stolen Ukrainian grain from entering supply chains under forged origin documents. Energy Market Compliance: The European Commission opened infringement proceedings over missed electricity, hydrogen and gas market transposition deadlines, including Latvia, pushing governments to update consumer choice and energy-sharing rules. Retail & Investment: “Lidl Latvija” reported 2025 turnover of €495.6m (+7.5%) and said it is still in an investment phase, including tech upgrades like Lidl Pay. Research & Industry Links: Latvia’s genomics and technology commercialisation delegation is in California to build partnerships with US research and innovation players, aiming to translate lab work into products. Cyber Risk Watch: Russia’s regulator ordered operators to inspect MikroTik RouterOS equipment after reported vulnerabilities, a reminder of supply-chain exposure for network gear.

Cybersecurity & Telecom: Russia’s regulator Roskomnadzor ordered operators to inspect MikroTik RouterOS gear after alleged vulnerabilities could let attackers bypass authentication and take full control, with updates urged and possible port restrictions if users don’t patch. Biotech & Trade: Latvia’s LIAA-backed delegation is in California to build genomics partnerships and commercialise research, meeting US firms and tech-transfer centres in Los Angeles and San Diego during President Rinkēvičs’ visit. Energy Regulation: The European Commission opened infringement cases over missed electricity, hydrogen and gas market transposition, including Latvia, giving governments two months to respond. Defense Industry: Latvia is moving toward layered counter-drone air defence cooperation, with Anduril and ORIGIN signing an MoU to test integrated tech in Latvia. Agriculture & Border Controls: Latvia’s Saeima approved tighter checks on third-country grain transit to stop stolen Ukrainian crops entering via forged documents, enabling PVD inspections and lab sampling. Heating Costs: Latvia’s energy ministry warns heating bills could rise 10–15% this winter, depending on fuel purchases and local heat sources.

Defense & Industry: Latvia is moving to buy Anduril’s Barracuda long-range cruise missiles, with President Edgars Rinkēvičs saying the acquisition is expected to be completed after his U.S. visit, while Latvia’s drone maker ORIGIN signed memoranda with Anduril to assess counter-drone integration for NATO’s eastern flank, including joint testing and demonstrations in Latvia. Border & Agri-Trade Security: The Saeima has tightened rules to stop stolen Ukrainian grain and related feed from being routed through Latvia by requiring stricter border checks on third-country shipments and allowing laboratory testing to verify origin when documents don’t match. Energy Costs: Latvia’s heating bills are expected to rise 10–15% this winter in mild to moderately cold conditions, with fuel supplies available but costs varying by heat source and when fuel was purchased. Transport Infrastructure: Rail Baltica’s Tallinn–Pärnu completion has been pushed to 2032 as the Baltic states align the main line with the EU budget period through 2034, aiming to ease pressure on national budgets. EU Compliance Watch: The European Commission opened infringement steps against Latvia and other states over gaps in industrial emissions, hydrogen/gas market rules, and right-to-repair transposition. Business & Investment: Capalo AI says it has passed 1 GW of contracted battery storage capacity across the Baltics, building hybrid solar-plus-storage parks and expanding optimization services.

Border Security & Food Supply Chains: Latvia’s Saeima has tightened rules for third-country grain and animal feed transit, empowering the Food and Veterinary Service to run border checks and take lab samples to verify origin and stop stolen Ukrainian agricultural goods moving under forged documents. Energy Costs: Latvia’s Ministry of Climate and Energy warns heating bills could rise 10–15% in a mild-to-moderate winter, with local differences depending on fuel and purchase timing. Rail Baltica: The Tallinn–Pärnu rail link is now targeted for 2032 as the Baltic states shift the main-line completion into the 2028–2034 EU budget period, while construction continues on started sections. Aviation & Infrastructure: Riga Airport is pushing ahead with a €98m terminal expansion adding 20,000 sqm of passenger space and 42 months of staged works while staying operational. Defense Industry: Latvia expects to complete its purchase of Anduril’s Barracuda cruise missiles and signed cooperation memoranda with drone maker Origin Robotics. EU Workplace Safety: Eurostat reports EU workplace deaths rose to 3,367 in 2024, up 1.4%, with manufacturing, construction and mining among higher-risk sectors.