AGP Executive Report

Energy & Renewables: Latvenergo is scouting up to 250 MW of new wind or hybrid projects, adding to its growing Baltic renewables stack that already includes a 265 MW solar park and a battery storage pipeline. Agriculture: Wet weather is complicating Latvia’s potato harvest, with waterlogged fields raising rot risks and slowing machinery, while cockchafer larvae and high fuel costs add pressure. Trade & Food Security Debate: A fact-check pushes back on claims that Latvia can only meet 27% of food needs, saying the figure actually reflects the share of domestically produced goods in consumption, not self-sufficiency. Defense & Aviation Risk: Germany-linked reporting on the Leipzig/Halle airport drone attempt points to suspected GRU-linked planning and logistics, underlining how fragile air logistics remain. EU Competitiveness: At the Riga Conference, EU economy chief Valdis Dombrovskis tied competitiveness to security, pointing to a proposed 2-trillion-euro budget package and a new competitiveness fund. Industry & Markets: Latvia’s government says it has completed 16 of 61 priority tasks so far, with more dependent on European Commission approval.

Energy & Renewables: Latvenergo is scouting up to 250 MW of new wind or hybrid projects, building on its 265 MW Aizpute solar park and a growing battery storage pipeline (233.4 MW under development as of June). EU Competitiveness & Security: At the Riga Conference, EU Economy Commissioner Valdis Dombrovskis said competitiveness and defence must move together, pointing to a proposed €2tn 2028–2034 budget package and a new Competitiveness Fund. Defence AI in Latvia: NestAI is opening a Latvia R&D centre, aiming to hire 30 scientists/engineers and invest €10m to develop AI defence solutions for NATO’s eastern flank. Baltic Infrastructure Security: A new focus on protecting critical infrastructure from Russian hybrid tactics is highlighted as the Baltic’s ports and energy links remain key targets. Grain Transit Politics: A grain transit ban debate is heating up, with industry warning Latvia’s role as a predictable corridor could take a long hit. Food & Agriculture: Wet weather is complicating Latvia’s potato harvest, with waterlogged fields raising rot risks and cockchafer larvae adding pressure. Aviation Risk: Ukraine’s drone activity and warnings about unsafe Russian airspace are again raising concerns for civil aviation and commercial overflights.

EU Competitiveness Push: At the Riga Conference, EU Economy Commissioner Valdis Dombrovskis said Europe must close its competitiveness gap, linking economic strength to defence capacity, and pointed to a proposed €2tn 2028–2034 budget with a new Competitiveness Fund plus higher security spending. Energy & Renewables: Latvenergo is scouting up to 250 MW of new wind or hybrid projects to expand renewables and battery storage, building on its 265 MW Aizpute solar park and a pipeline of battery projects. Defence AI in Latvia: NestAI is opening a Latvia R&D centre, hiring 30 scientists and engineers and investing €10m to develop AI-based defence solutions for NATO’s eastern flank. Food Security Debate: Fact-checkers pushed back on claims that Latvia can only meet 27% of food needs, saying the figure refers to domestically produced goods’ share in consumption, not self-sufficiency. Grain Transit Warning: A grain transit ban debate is heating up as industry warns it could damage Latvia’s reputation as a stable transit corridor and trigger major economic fallout. Agriculture Hit by Weather: Wet conditions are complicating Latvia’s potato harvest, with growers warning of rot risk in waterlogged fields and added pressure from high fuel costs. Infrastructure Repair: The Lielupe Bridge will close at night for two separate weeks in September for steel reinforcement works costing about €2.0m.

Defence AI Push in Latvia: NestAI is opening a €10m R&D centre in Latvia, hiring 30 scientists and engineers to build NATO-eastern-flank defence AI solutions, with talks planned around the Riga Conference. Infrastructure Repair: The Lielupe Bridge on the Liepāja highway will close at night for two weeks (14–18 Sept and 21–25 Sept) for steel reinforcement and repairs costing about €2.0m, with detours via Jelgava routes. Energy Security Angle: Europe’s energy diversification focus is again in the spotlight as Middle East tensions and Iran-linked shipping risks lift fuel prices and underline route vulnerability. Food Industry Insight: A Latvian study finds “high in protein” labels are widely understood (72%), but only 6% know the daily amount people should eat—fueling debate over nutrition marketing vs guidance. EU Policy Watch: More than 120 MEPs urge reopening talks on using frozen Russian sovereign assets for Ukraine, arguing the €90bn loan is not enough. Local Media & Comms: Latvian TV’s Zaķusala tower refurbishment contract is set at over €38m, aiming for a 2029 reopening with viewing platforms and public event space. Agriculture Prices: Eurostat reports EU agricultural output prices down 5.8% year-on-year in Q2; Latvia’s output prices fall 14.5%, reflecting pressure on farm revenues. Cybercrime Court Case: A Ukrainian linked to the Conti ransomware operation was sentenced to four years in the US, adding to the growing enforcement trail against the group.

EU Trade & Industry: The European Commission has proposed a new Public Procurement Act that would let EU public buyers exclude or reject bids from suppliers in countries not covered by bloc procurement agreements, with reporting widely framing the move as aimed at China—an approach critics call protectionist. Latvia–Russia Food Supply: Latvia’s Saeima backed initial steps to extend sanctions against Russia and Belarus by widening import bans from agricultural goods and animal feed to also cover food products, amid concerns about grain export loopholes. Agriculture Prices: Eurostat data show EU agricultural output prices fell 5.8% year-on-year in Q2 2026; Latvia saw a sharper 14.5% drop, while input costs rose across all member states, including Latvia (+9.7%). Energy & Renewables: Solar kept scaling in the EU—adding at least 33.8 GW in H1 2026 and reaching a record 25% share of electricity generation in June; Latvia is among countries exceeding 50% solar share in at least one month. Drones for Industry: Latvia-based SPH Engineering expanded its Canadian distribution partnership for specialized drone sensors, targeting sectors from mining and utilities to environmental monitoring. Defense Tech & Cooperation: Ukraine and Latvia signed a drone production agreement, while Latvia also hosted meetings on economic and defense cooperation with Ukrainian officials. Circular Economy: Latvia’s second Circular Economy Index highlights that municipalities are improving circularity, but growth now depends on changes in management models and everyday public habits.

Ukraine–Latvia Defence Ties: Kyrylo Budanov met Latvia’s PM Andris Kulbergs in Riga, focusing on faster energy equipment deliveries for the heating season and deeper military cooperation, including defense-industry partnerships. Drone Manufacturing: Latvia and Ukraine plan a joint drone factory in eastern Latvia near the Russia/Belarus border, with Ukraine supplying strike/ground/maritime unmanned systems and Latvia providing counter-drone gear. Circular Economy: Latvia’s second Circular Economy Index says top-scoring municipalities can scale local circular initiatives, but growth now depends on changing management models and everyday public habits. Solar Power Surge: EU solar added at least 33.8 GW in H1 2026; solar hit a record 25% share of electricity in June, with Latvia among countries exceeding 50% in at least one month. Tyre Recycling Drive: Riga’s campaign collected 255.3 tonnes (25,500 used passenger tyres) for recycling, with free drop-offs for legal entities booked in advance. Rail Baltica Funding Gap: RB Rail says the next EU budget must cover about €5bn more just to complete a single track by 2030, after major cost revisions. Local Business Support: LIAA opens applications for its Business Incubation Programme for young Latvian companies, offering up to 70% support for development and mentoring.

Defence Industry & Security: Latvia’s Defence Minister Raivis Melnis met Ukraine’s presidential office head Kyrylo Budanov in Riga, with talks on regional security, military support and a defence industry partnership, plus a panel on bringing Ukraine’s warfighting know-how into NATO. Aviation Services: Baltic Ground Services (BGS) has started aircraft refuelling at Kaunas and Riga airports, initially for Airest, expanding ground-handling and fuel services across the region. Energy & Infrastructure: Latvia is proposing a 300% transit tariff on Russian and Belarusian grain as Black Sea disruptions push trade toward Baltic routes, while stevedoring firms warn a transit ban could cost hundreds of millions and trigger legal claims. Digital Economy: Tet will open its new Salaspils data centre “DC7”, positioning it as a modern, resilient hub for Latvian and regional customers. Business Support: LIAA opens autumn applications for its Business Incubation Programme (9–24 Sept), offering up to 70% support for young Latvian firms aiming for innovation and export readiness. Space & Tech: ESA signed an agreement with Vast for Greece’s first crewed mission to the ISS, with Latvia watching the wider European space push. Hospitality: Mogotel and Marriott launch Latvia’s first Four Points Flex by Sheraton in Riga, opening in October.

Defence Industry & Dual-Use: At Latvia’s Dual-Use Export Forum in Rēzekne, industry leaders said Europe’s defence build-up will rely heavily on civilian suppliers in electronics, engineering, software and sensors—not just defence primes—highlighting cross-sector matchmaking with firms including BAE Systems, Dedrone and SAF Tehnika. Rail Baltica Procurement: Rail Baltica regional train procurement by Elron, Vivi and LTG Link failed after no compliant bids were received; operators will clarify documents and restart with an expected faster timeline. Mining & Construction Materials: British SigmaRoc agreed to buy Lithuania’s AB Dolomitas for €110m, securing high-grade dolomite supplies used in construction and “green” steel inputs. Latvian Tech & Data Infrastructure: Telecom “Tet” is opening its new Salaspils data centre DC7, positioning it as a modern, resilient hub for local and regional customers. Counter-Drone Industry: Latvia’s ORIGIN is showcasing its autonomous interceptor BLAZE at MSPO with a new directional fragmentation warhead developed with Poland’s WITU. Economy Watch: Latvia’s inflation rose to 3.2% year-on-year in August, with transport costs accelerating amid higher fuel prices.

Latvian Defence Tech: ORIGIN is showcasing its autonomous counter-drone interceptor BLAZE at MSPO with a new directional fragmentation warhead module developed by Poland’s WITU, now NATO-codified for STANAG-compliant use—aimed at scaling production partnerships across Europe. Energy & Industry: Armenian FM Ararat Mirzoyan toured Riga’s BOVO GAS biomethane plant, highlighting how agricultural waste is converted into renewable gas injected into Latvia’s natural gas network, with talks on energy resilience and diversification. Inflation Watch: Latvia’s consumer prices rose to 3.2% year-on-year in August, with transport costs (fuel) driving the increase. Trade & Security: Latvia expanded restrictions on Russian and Belarusian imports, banning books, newspapers and other printed materials from Sept. 1 to curb disinformation and war propaganda. Heating Season: Regulators and heat suppliers are preparing for autumn tariffs, with forecasts already pointing to higher costs if woodchip and natural gas prices stay elevated. EU Solar Trend: EU solar installations reached at least 33.8 GW in H1 2026, with Latvia among markets seeing rapid expansion from large-scale projects.

Security & War Impact: Russia ended a short strike pause and hit Kyiv with ballistic missiles soon after US peace envoys left, damaging residential areas and killing at least two. EU Energy & Renewables: The EU added at least 33.8 GW of solar in H1 2026, with Latvia among the smaller markets seeing rapid expansion via large PV projects. Latvian Trade & Information Security: Latvia banned imports of Russian and Belarusian books, newspapers and printed materials from Sept 1, aiming to curb disinformation and war propaganda; the move also covers some consumer goods and applies even when routed via third countries. Ports & Grain Logistics: Latvia’s transport ministry says ports are not refusing domestic grain; it also plans priority access and origin checks for transit grain. Armenia–Latvia Industrial Cooperation: Armenian FM Ararat Mirzoyan visited Latvia’s Bovo GAS biogas plant, highlighting biomethane injection into Latvia’s gas network and discussing energy resilience and diversification. AI Infrastructure (Business): Ajelix announced new GPU compute infrastructure and a general release of its enterprise AI platform for organizations. Defense & Disruption Threats: A pro-Russian group sent threats to weapon suppliers to Ukraine, demanding a halt by Oct 7. Infrastructure & Transport: Riga Airport launched the next phase of a €98m terminal expansion to add about 20,000 m² and boost capacity.

Grain Trade Shock: Latvia plans a 300% tariff on grain shipments arriving from Russia and Belarus, aiming to curb transit flows that have surged after Ukraine drone attacks hit Baltic ports. Energy & Security: A Baltic-wide push for resilience is growing as major energy firms form the Baltic Energy Initiative to pursue EU-backed cross-border projects and share protection know-how against physical and hybrid threats. Airport & Logistics: Riga Airport has started the next phase of its €98m terminal expansion, adding about 20,000 m² of capacity and modern passenger facilities. Renewables: Latvia expanded its household solar and battery rebate scheme, boosting grant coverage for eligible families and raising the minimum battery size to store more self-generated power. Cyber Risk: Latvian CERT.LV warns of active MikroTik RouterOS MikroTrick attacks that can take full control of internet-exposed routers, urging urgent patching. Local Industry Watch: Eurostat data shows Latvia’s services production fell month-on-month in June, while job vacancies remain elevated, especially for technicians and skilled agricultural workers. Defense Tech: XTEND’s Latvia-linked robotics expansion delivers its AtlasROVER ground robot using a shared software layer for air and ground missions.

Latvia Jobs & Skills: Latvia has nearly 20,000 job vacancies, with the highest vacancy shares among technicians and associate professionals (3.5%) and skilled agricultural/forestry/fishery workers (2.6%), while the Rīga region leads vacancy rates (2.6%). Baltic Energy Cooperation: Latvenergo and partners from nine Baltic-region countries launched the Baltic Energy Initiative to pool know-how and pursue EU funding for offshore wind, LNG/bio-LNG, hydrogen, carbon transport/storage, and small modular reactors, with a strong focus on protecting critical infrastructure from physical and hybrid threats. Rail Baltica Costing: Latvia’s transport ministry put a price tag on preserving and conserving a key Rail Baltica overpass span and support structure in the Daugava, with conservation design estimated at 81,414 euros (VAT included) and longer-term conservation works for the subsection pegged at about 551,000 euros (VAT excluded). Cyber & Telecom Risk: Attackers are actively exploiting MikroTik RouterOS MikroTrick flaws to take full control of internet-exposed routers, prompting urgent patching guidance from CERT Polska and Latvia’s CERT.LV. Local Infrastructure: Daugavpils has restarted a long-stalled overpass plan by launching a tender to update costs for the second phase after the first section was completed in 2020. Agriculture: Latvia’s apple harvest is off to a good start, but growers say most late autumn and winter varieties are still ahead.

Public Health & Food Systems: Eurostat data show obesity is rising across Europe, with men more affected than women; Latvia records 24.6% adult obesity (and Malta leads at 26.6%), a reminder of how nutrition and lifestyle pressures can ripple into agriculture and food industry demand. Cyber & Critical Infrastructure Security: Germany plans a sweeping response to Russian sabotage and cyberattacks, including drone-protection units across major cities and a “Cyberdome” for network defense—an issue that directly impacts Latvia’s regional supply chains and transport security. Latvian Tech & Network Risk: MikroTik RouterOS flaws are being exploited in the wild via an unauthenticated remote access path, pushing administrators to patch fast to prevent full device takeovers. Energy & Winter Readiness: EU gas storage snapshots put Latvia at 45% (lowest in the bloc), while Poland leads at 93.5%, shaping how Baltic energy firms plan procurement and resilience. Baltic Business & Logistics: Latvia’s ports report priority for Latvian grain amid shifting regional flows, highlighting how shipping and logistics decisions are becoming strategic for local producers.

Baltic Security & Defence: Germany’s accusation that Russia used an explosives-laden drone in the Leipzig-Halle Airport attack has reignited EU fears of a wider “hybrid war,” with calls for faster Baltic Sea coordination and tougher responses. Ukraine Logistics Under Pressure: Analysts say repeated Russian strikes on Ukrainian ports are pushing the country toward being “effectively landlocked,” threatening grain and trade routes. Drone Industry Push: Britain is pouring $5bn into drone development and production, while Latvia’s earlier pledge to supply 15,000 drones to Ukraine and the wider Baltic-led drone shipment push keep defence manufacturing in the spotlight. Energy Cooperation: NB8 nations (including Latvia) secured at least €918m for Ukraine’s winter energy needs, targeting both grid repairs and longer-term resilience. Riga Aviation Investment: Riga Airport has started the next stage of its €98m terminal expansion, a direct signal of continued infrastructure spending. Latvian Business & Output: Latvia’s industrial output fell 0.2% in July, adding pressure to manufacturers already facing energy and demand swings. Tech & Robotics (Latvia-linked): XTEND says it has deployed its AtlasROVER ground robot using its XOS software platform after acquiring Latvia-based Atlas, expanding robotics beyond drones.

Lithuanian Defence Procurement: Lithuania has approved a ~€5m state contract for an integrated AI airspace surveillance and control system to unify sensor data, improve drone detection, and speed public warnings, with a pilot planned for early 2027 and NATO data integration targeted for 2028. Baltic Energy Security: NB8 countries (including Latvia) pledged at least €918m in 2026 to support Ukraine’s winter energy needs, focusing on grid repairs, resilience, decentralisation, and EU market integration. Riga Airport Expansion: Riga Airport has started the next stage of its €98m passenger terminal expansion, aiming to boost capacity and passenger flow. Latvian Industry Watch: Latvia’s industrial output fell 0.2% year-on-year in July; manufacturing rose 1.8% while mining and utilities contracted. Waste & Recycling Investment: CleanR Industry will invest €3.3m to automate Riga’s separately collected packaging sorting center, targeting higher-quality material separation and more secondary raw materials. Food Production & Logistics: LIDO laid a time capsule for “LIDO House,” a Riga production, logistics and warehousing complex with over €30m planned investment to expand capacity, product range, and exports. Ukraine Supply Chain Under Pressure: Russian drones hit Teva and WHO medical warehouses in Ukraine, underlining damage to storage and distribution networks.

Latvian Industry Watch: Latvia’s industrial output slipped 0.2% year-on-year in July, with mining and utilities weighing on results while manufacturing rebounded 1.8%. Waste & Circular Economy: CleanR Industry will invest €3.3m to modernize Riga’s separately collected packaging sorting center, aiming for more automation, better material separation, and higher volumes of secondary raw materials. Energy & Infrastructure: Riga Airport has started the next stage of its €98m passenger terminal expansion, while Baltic offshore wind keeps growing but still struggles with grid integration. Baltic Trade & Logistics: Stevedoring groups say Latvian grain is prioritized at ports and isn’t being displaced by transit cargo. Defense & Dual-Use: Latvia hosts the Dual-Use Export Forum in Rēzekne (6–7 Sept), with 180+ participants and 150+ business meetings focused on plugging Latvian tech into international defense supply chains. Regional Connectivity: Baltic leaders push for more EU funding to keep Rail Baltica on track for 2030, warning delays could jeopardize grants. Corporate Moves: CleanR Grupa reported 13% turnover growth in H1 2026 and continued investment in fleet and equipment.