Viewing cable 08RIGA815
Title: RESTRUCTURING AND REDUCTIONS AT LATVIAN MFA

IdentifierCreatedReleasedClassificationOrigin
08RIGA8152008-12-23 13:51:00 2011-08-30 01:44:00 CONFIDENTIAL//NOFORN Embassy Riga
VZCZCXRO3540
PP RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSR
DE RUEHRA #0815 3581351
ZNY CCCCC ZZH
P 231351Z DEC 08
FM AMEMBASSY RIGA
TO RUEHC/SECSTATE WASHDC PRIORITY 5500
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
C O N F I D E N T I A L RIGA 000815 
 
SIPDIS 
NOFORN 
 
E.O. 12958: DECL: 12/23/2018 
TAGS: PGOV PREL PINR LG
SUBJECT: RESTRUCTURING AND REDUCTIONS AT LATVIAN MFA 
 
Classified By: A/DCM Tamir G. Waser.  Reasons: 1.4 (b and d) 
 
¶1. (C/NF) Summary: A planned restructuring of the Latvian 
foreign ministry to reduce the size of senior leadership and 
staff and salary reductions necessitated by budget cuts will 
likely add to the frustrations of an already unhappy 
diplomatic service.  Decision making will be further 
concentrated in the hands of a few people, all of whom are 
generally supportive of the US, but it will be harder for the 
Latvians to follow multiple issues concurrently.  In the next 
six months, as many as 20 diplomats will lose their jobs and 
all personnel will face pay cuts.  This is only one example 
of the very difficult choices Latvia will face in 
implementing the changes in fiscal policy necessitated to 
qualify for international financial assistance.  End summary. 
 
¶2. (C) Starting January 1, the current eight undersecretaries 
at the MFA will be reduced to two - handling political and 
administrative functions.  Peteris Ustubs, currently 
political director at the ministry, will become the political 
undersecretary, overseeing EU affairs, bilateral issues, 
economic and security policy.  The current undersecretaries 
for EU, bilateral and economics issues will become 
directors-general and security policy will be subsumed in 
bilateral affairs.  Ivars Pundars, returning from being 
Ambassador to Turkey, will head up the administrative area, 
with the current undersecretaries for personnel, legal, and 
consular affairs also becoming directors-general.  Ustubs and 
Pundars will report to new State Secretary Andris Teikmanis. 
 
¶3. (C/NF) Contacts in the MFA generally view this as a plan 
by FM Riekstins to further close the limited circle of 
advisors he consults on issues.  Many desk officers and 
office directors say that they are completely removed from 
any discussions of actual policy and limited simply to 
writing briefers and planning visits.  The mood in the 
ministry has noticeably worsened in the past year. 
 
¶4. (C/NF) While it is true that the number of decision makers 
in the MFA will be reduced, we believe that all of the key 
officials are supportive of strong and robust ties with the 
U.S.  Riekstins, of course, has a long history as MFA state 
secretary and Ambassador to Washington.  Ustubs has been one 
of this Embassy's closest contacts both in his current 
position and as foreign policy advisor to former PM Kalvitis. 
 Pundars was a close contact prior to his assignment to 
Turkey.  Teikmanis made an effort to ensure that Ambassador 
Larson was among the first Ambassadors he met upon assuming 
the job at the beginning of December.  That said, some of the 
demoted undersecretaries, especially on economic, bilateral 
and consular issues, have also been good friends and we fear 
that their substantive knowledge and intellectual firepower 
will be used less, making it harder for the minister to stay 
abreast of more than a few key issues at any one time. 
 
¶5. (C) Adding to the ministry's challenges are the deep 
financial cuts needed to satisfy the government's drive for 
fiscal discipline.  Already 24 vacant positions have been 
eliminated and 21 more need to be cut by July 1.  Our 
understanding is that this will require letting personnel go 
and while many of the vacant positions were administrative, 
most of the lay offs will come from diplomats.  There will 
also be a hiring freeze.  Those employees who remain will 
face salary cuts of 5 percent for lower paid employees and 10 
percent for the higher paid ones.  In addition to the salary 
cuts, personnel serving overseas will also see an additional 
cut of 15 percent in their cost of living and hardship 
allowances.  Housing, education and medical benefits overseas 
will be preserved.  The ministry will almost certainly close 
its consulate in Bonn and closures of other missions may be 
needed.  Travel budget has been reduced drastically. 
 
¶6. (C/NF)  Comment:  The cuts and restructuring coming at the 
same time will do little for morale at the MFA, but given the 
overall economic situation here, we don't see a mass exodus 
of employees as likely.  One senior official voiced concern 
about the long-term impact of the staffing cuts and hiring 
freeze, saying that the MFA will find itself in future with 
more senior officials and not enough people to handle the day 
to day work. The situation at the MFA, especially on staff 
and salary reductions, is likely to be repeated across the 
Latvian government in coming weeks as institutions implement 
the tough fiscal policy passed by the government to qualify 
for international financial assistance. 
ROGERS