After Latvia's independence was secured, the parliamentary era began with elections to the Constitutional Assembly in April 1920, followed by the adoption of the Latvian Constitution in 1922. This period was marked by frequent government changes, economic reforms, and border disputes, but ended abruptly with a coup d'état in 1934.
Latvia’s first elections reflected the fragmentation of its political landscape. The Social Democratic Workers' Party won the most seats but refused to join coalition governments, resulting in unstable governments led mostly by the Latvian Farmers' Union. In just 12 years, Latvia saw 13 different governments and 9 prime ministers. Four parliamentary elections were held during this period (1922, 1925, 1928, 1931). The Presidency rotated between Jānis Čakste (1922–27), Gustavs Zemgals (1927–30), and Alberts Kviesis (1930–34). However, the division among parties and rising political instability would later contribute to Kārlis Ulmanis’ coup in 1934.
Border Disputes and Resolutions
Latvia faced border conflicts with Estonia, Lithuania, and Poland:
- Northern Border: Estonia and Latvia clashed over the Valka region but resolved it through British-led arbitration. Latvia retained Ainaži parish, while Estonia received most of Valka.
- Southern Border: Latvia and Lithuania disputed control over Palanga and Aknīste, but in 1921, an arbitration committee granted Palanga to Lithuania and Aknīste to Latvia.
- Polish Border: Latvia and Poland avoided conflict after cooperating against the Soviets. In 1929, Latvia compensated Polish landowners for losses along their shared border.
Foreign Relations
Latvia focused on building alliances and securing international recognition. Zigfrīds Anna Meierovics, Latvia’s key diplomat, ensured the country’s entry into the League of Nations in 1921. Despite initial hopes for a Baltic union, only Latvia and Estonia signed a military alliance in 1923. Latvia maintained balanced relations with both Germany and the Soviet Union, while expanding diplomatic missions across Europe.
Economic Policies and Challenges
The land reform was a cornerstone of Latvia’s economic policy. The government expropriated German estates and redistributed land to 54,000 new small farmers, transforming Latvia into a nation of smallholders focused on dairy farming. This reform weakened the German elite and promoted Latvian ownership of land.
Latvia also launched its own currency, first introducing the Latvian ruble in 1919, followed by the Latvian lats in 1922 to stabilize the economy. By 1923, the country was running budget surpluses, with major investments in education and defense. However, the Great Depression in 1929 caused unemployment, falling exports, and budget deficits. Latvia shifted to state monopolies and clearing trade agreements with France, Germany, and the UK to survive the economic downturn.
Political Fragmentation and Social Unrest
Latvia's democracy was marked by political instability. The Social Democrats controlled the Speaker’s post but refused to join coalition governments, leading to ineffective governance. Right-wing parties, like the Latvian Farmers' Union, led many of the short-lived governments. The extreme nationalist Pērkonkrusts party gained some influence, reflecting rising nationalist and anti-German sentiment.
Ethnic minorities, including Germans, Jews, and Poles, had their own small parties, which often participated in coalitions. Meanwhile, Communists operated underground, winning seats in parliament under disguised labels before being banned in 1933.
The inability to form stable governments and the economic hardships of the Depression weakened public trust in the democratic system. In May 1934, Kārlis Ulmanis—fearing the upcoming elections might diminish his influence—staged a coup d'état. He dissolved the parliament, suspended political parties, and established an authoritarian regime, ending the parliamentary era.
The parliamentary era laid the foundations for Latvia's democratic institutions, including its constitution and electoral system. However, political fragmentation and economic challenges limited the government’s effectiveness, paving the way for authoritarianism. Despite these difficulties, the period marked Latvia’s transition from agrarian dependency to industrialization and diplomatic integration into the European political order.