In February 2016, Kučinskis of the ZZS was appointed prime minister of Latvia. He replaced Laimdota Straujuma of the Unity party, who had resigned in December 2015 following internal strife within both Unity and the ruling coalition, though the party composition of the ruling coalition remained intact. In addition to the ZZS and Unity, it also includes the nationalist National Alliance. It took nearly another three months to prepare a government program, which upon its release prioritized strengthening the economy and national security, and reforming the education and health care sectors.

In July 2016, Latvia became a member of the OECD, boosting its international credibility and providing an additional impetus to increase transparency and tackle the rather neglected issue of international money laundering, though concrete results of any initiative addressing the latter were yet to be seen at year’s end. Meanwhile, state institutions have taken active steps to combat corruption and tax evasion, but the effectiveness of any reforms has been hampered by the institutions’ inability to consolidate power within their own fields of competence. In May, the head of the State Revenues Service resigned, saying she was struggling to implement planned reforms—among them measures aimed at increasing transparency—due to internal tensions and resistance from allied institutions. Meanwhile, despite legislative changes aimed at consolidating the Corruption Prevention and Combating Bureau of Latvia (KNAB) and making it more autonomous, throughout the year its work was marred by public controversies and infighting. During the year, the selection of the new KNAB chief, as well as of the Revenue Service, was delayed and contributed to tensions within the ruling coalition.

Recent years have seen a gradual decrease in the influence of oligarchs in Latvia—attributable mainly to reforms in party financing mechanisms and anticorruption operations—leaving government and political institutions more responsive and accountable to citizens.

Press freedom is generally respected in Latvia, though libel remains a criminal offense. In July 2016, a scandal erupted around the NEPLP, after it was revealed that in March it had requested that police uncover the source of journalist who had discovered and publicized likely appointees to its board, ahead of the body’s formal announcement.

Geopolitical tensions continued to exacerbate the existing social and political divide between the country’s ethnic Latvians and its sizable ethnic Russian minority. About 250,000 Latvian residents, mostly ethnic Russians, still do not have citizenship status and altogether any voting rights, and unemployment is higher among Russians than Latvians. In November, the parliament approved an amendment that would allow teachers to be fired if they were found to be “disloyal” to Latvia. The legislation was set to take effect in 2017, and had been introduced after a teacher sparked controversy by suggesting in a radio interview that he was not loyal to the Latvian state.