Latvia ( /ˈlætviə/ Latvian: Latvija), officially the Republic of Latvia (Latvian: Latvijas Republika) is a country in the Baltic region of Northern Europe. It is bordered to the north by Estonia (343 km), to the south by Lithuania (588 km), to the east by the Russian Federation (276 km), and to the southeast by Belarus (141 km). Across the Baltic Sea to the west lies Sweden. The territory of Latvia covers 64,589 km2 (24,938 sq mi) and it has a temperate seasonal climate. The Latvians are Baltic people culturally related to the Estonians and Lithuanians, with the Latvian language having many similarities with Lithuanian, but not with the Estonian language. Today the Latvian and Lithuanian languages are the only surviving members of the Baltic languages of the Indo-European family. The modern name of Latvia is thought to originate from the ancient Latvian name Latvji, which, like the name of Lithuania, may have originated from the river named Latuva.

Latvia is a unitary parliamentary republic and is divided into 118 municipalities (109 novadi and 9 cities). The capital and largest city is Riga. Latvia has been a member of the United Nations since September 17, 1991; of the European Union since May 1, 2004 and of the NATO since March 29, 2004.

Latvia is a member of the World Trade Organization (1999) and the European Union (2004).

Since the year 2000 Latvia has had one of the highest (GDP) growth rates in Europe. However, the chiefly consumption-driven growth in Latvia resulted in the collapse of the Latvian GDP in late 2008 and early 2009, exacerbated by the global economic crisis and shortage of credit. Latvian economy fell 18% in the first three months of 2009, the biggest fall in the European Union. According to Eurostat data, Latvian PPS GDP per capita stood at 56 per cent of the EU average in 2008.

This latest scenario has proven the earlier assumptions that the fast growing economy was heading for implosion of the economic bubble, because it was driven mainly by growth of domestic consumption, financed by a serious increase of private debt, as well as a negative foreign trade balance. The prices of real estate, which were at some points appreciating at approximately 5% a month, were long perceived to be too high for the economy, which mainly produces low-value goods and raw materials. Since 2001, Latvia's chief export has been domestic livestock.

Latvia plans to introduce the Euro as the country's currency but, due to the inflation being above EMU's guidelines, the government's official target is now 1 January 2012. However in October 2007, with inflation above 11%, the head of the National Bank of Latvia suggested that 2013 may be a more realistic date.

Privatisation in Latvia is almost complete. Virtually all of the previously state-owned small and medium companies have been successfully privatized, leaving only a small number of politically sensitive large state companies. Latvian privatization efforts have led to the development of a dynamic and prosperous private sector, which accounted for nearly 68% of GDP in 2000.

Foreign investment in Latvia is still modest compared with the levels in north-central Europe. A law expanding the scope for selling land, including to foreigners, was passed in 1997. Representing 10.2% of Latvia's total foreign direct investment, American companies invested $127 million in 1999. In the same year, the United States exported $58.2 million of goods and services to Latvia and imported $87.9 million. Eager to join Western economic institutions like the World Trade Organization, OECD, and the European Union, Latvia signed a Europe Agreement with the EU in 1995—with a 4-year transition period. Latvia and the United States have signed treaties on investment, trade, and intellectual property protection and avoidance of double taxation