Latvia's GDP grows 2.8% in first half of 2026, reaching €21.3 billion
Latvia's gross domestic product rose by 2.8% in the first half of this year, with second-quarter output up 0.7% from the previous quarter. Growth was mainly driven by manufacturing, trade and the IT sector.
Latvia's gross domestic product (GDP) reached €21.3 billion at current prices in the first half of this year, with €11.491 billion generated in the second quarter alone. Compared with the same period last year, total value added in the second quarter grew by 3.4%, while quarter-on-quarter growth stood at 0.7%, according to the Central Statistical Bureau.
Sector performance
The largest contributions to growth came from wholesale and retail trade, manufacturing, and the information and communication sector. Manufacturing value added rose 5.5%, with growth recorded in most sub-sectors — fabricated metal products stood out with an 18.6% increase, while beverage production fell by 25.3%. Value added in information and communication grew 8.3%, driven largely by computer programming and consultancy, which expanded 16.6%.
Strong growth was also seen in finance and insurance, up 10.4%, boosted by a 40% surge in insurance, reinsurance and pension funding activities. Construction value added increased 3.2%, mainly due to building construction. In contrast, declines were recorded in transport and storage, agriculture, forestry and fishing, and in accommodation and food services.
Consumption and foreign trade
Household final consumption expenditure grew 3.7% in the second quarter, while government spending fell 2.4%. Gross fixed capital formation increased 6.5%, including a 9.8% rise in machinery and equipment. Exports of goods and services grew 7.7%, driven mainly by an 11.6% rise in goods exports, while imports rose 7.1%.
Total employee compensation increased 6.4% compared with the second quarter of last year, with the fastest growth — 10.3% — recorded in arts, entertainment and other services.
