Latvia’s environmental performance has improved in several areas, such as emissions of greenhouse gases and most air pollutants, residential energy efficiency, wastewater treatment and waste management. However, sustained economic growth is likely to intensify pressures on the environment and biodiversity. This chapter provides an overview of Latvia’s environmental achievements since the mid-2000s, and its remaining challenges. It reviews progress in reducing the energy and carbon intensity of the economy, improving air quality, strengthening waste and water management, and halting biodiversity loss.

Latvia has a strong regulatory framework for environmental management. However, institutional capacity constraints impede more effective implementation of environmental law and use of good regulatory practices, particularly in compliance assurance. The country has well-developed and effectively used mechanisms of environmental democracy. This chapter analyses the environmental governance system, including horizontal and vertical institutional co‑ordination and the setting and enforcement of environmental requirements. It also addresses public participation in decision making and access to environmental information, education and justice.

Latvia has managed to decouple several environmental pressures from its sustained economic growth, although challenges remain. It has significant opportunities for accelerating the transition towards a low-carbon, greener and more inclusive economy. This chapter analyses progress in using tax policy to pursue environmental objectives, as well as the steps taken to reform environmentally harmful subsidies. It also discusses public and private investment in low-carbon energy and transport infrastructure and services. The chapter examines the country’s eco-innovation performance and opportunities for the green industry. Finally, it briefly reviews progress in mainstreaming environmental considerations into development co‑operation.