Latvia wrestles with freedom of speech, economy issues

Riga - A college lecturer arrested by police on charges of attempting to undermine the Latvian economy said Thursday he would be more careful about his public statements in future.

Dmitrijs Smirnovs took part in a discussion in the pages of regional newspaper Ventas Balss on October 2 in which he was highly critical of Latvian central bank policy and advised savers to convert the local currency, the lat, into US dollars.

As a result of his words, the economics expert was detained by police and has been banned from leaving the country pending further enquiries.

"I will be very, very cautious in discussions and interviews. My lectures will be delivered in advance as all my lectures are based on macroeconomic indicators," Smirnovs said.

In a second case, pop singer Valters Fridenbergs was detained by police for a flippant remark he made between songs during a concert in the provincial town of Jelgava on November 9.

Referring to the recent surprise nationalisation of Parex Banka, the country's largest indigenous financial institution, Fridenbergs allegedly told his audience to wait until the concert was over before withdrawing their money from Parex and another locally-owned bank, Latvijas Krajbanka.

That was enough for police to detain the young singer for questioning under a statute against "knowingly spreading false information about the Latvian financial system."

Both incidents have sparked debate in the Latvian media about freedom of expression in the Baltic country, which joined the European Union in 2004.

After a decade of rapid economic growth, Latvia slumped into recession earlier this year and most economists agree the country's economy will remain in the doldrums until at least 2010. Under such circumstances, rumours about the stability of banks and devaluation of the currency have started to circulate.

Now, it seems, the authorities want to crack down on such talk.

While it is common for countries to have legislation against insider trading and fraud, neither Smirnovs nor Fridenbergs appear to have experienced any financial gain from their comments.

As a result, some commentators say that at best the Latvian authorities have no sense of humour and at worst they are infringing an individual's right to an opinion, no matter how ill-informed it might be.

That's not how Ilmars Rimsevics, governor of the Latvian central bank sees it.

"In any other country, if people were intentionally spreading rumours of a bank's bankruptcy or currency devaluation the would be detained in ten or fifteen minutes," he said.

Martins Bondars, president of Latvijas Krajbanka, one of the banks mentioned by Fridenbergs, took a more nuanced, but largely supportive view.

He told Deutsche Presse-Agentur dpa: "Democracy works by having rights and responsibilities. They go hand in hand."

"The young gentleman in question (Fridenbergs) is talented and no- one in the bank wishes him harm. I think and hope he understands what he has done," he said.

According to Bondars, outsiders may miss the subtleties of the situation which has its roots in the popular movement that saw Latvia win its independence from the Soviet Union in 1991.

"You have to understand Latvia's recent history," he said. "In the late 1980s and early 1990s, the people leading the singing revolution were journalists, singers and intellectuals. They still enjoy very high, unconditional credibility in society. It's just the way things happen in the Baltics."

Even though Fridenbergs' actions had been meant in a light-hearted manner, Latvijas Krajbanka account holders had turned up at the Jelgava branch after the concert asking what was happening, another bank official told dpa.

However, political commentator Karlis Streips said using the police to silence dissent from the official line was unwarranted and set a dangerous precedent.

"We have politicians who are still not ready to admit the country is in a financial crisis," he said.

"I find it hard to believe people would really seek financial advice from a musician on a stage. I wouldn't like to believe that Latvia's currency is so fragile that it can be destroyed by a passing comment during a performance in Jelgava or a discussion group in a provincial newspaper."

"Unfortunately, once you start banning rumours about the financial situation you don't have too far to go before you have a totalitarian dictatorship," he said. dpa

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