RIGA, Latvia–One reason Latvians remain skeptical of adopting the euro–a poll ordered by the finance ministry showed only 38 % supported the euro in May–is that there have been many currency changes in Latvia in living memory, mostly against a backdrop of war, revolution, foreign occupations and drastic socioeconomic change.
The first time lats–the currency Latvia is giving up–were circulated was in 1922, at the end of war for independence fought after the republic of Latvia was proclaimed on Nov. 18, 1918. Before then, a motley collection of currencies circulated as mediums of exchange. There were Czarist rubles and rubles of subsequent Russian governments; the scrip, during German occupation in World War I; local currencies issued by cities and towns; and a temporary Latvian ruble.
When Latvia was annexed by the Soviet Union in 1940, the lat was abolished and replaced by Soviet rubles by the spring of 1941. A few months later, Latvia was occupied by Nazi Germany, and the occupation authorities circulated occupation Reichmarks. Not long after, Soviet rubles became the currency when the Red Army returned to Latvia in the fall of 1944.
During almost 50 years of Soviet rule, the ruble underwent two “redenominations” in 1947 and 1961, drastically reducing the value of cash ruble savings.
In 1992, months after Latvia regained its independence in August 1991, the newly reformed Bank of Latvia yet again issued Latvian rubles as a transitional currency to ease out the Soviet ruble.
The central bank governor at the time was Einars Repse–later a politician and prime minister–and the currency was quickly named the “repshie” by ordinary Latvians. The lat then made its comeback in 1993.
With the prospect of yet more currency turmoil ahead as Latvia adopts the euro, it’s perhaps understandable how some Latvians might look at nearby European Union states outside the euro zone with a touch of envy. Sweden’s krona, for example, has been in circulation for 140 years.