A harsh winter and very short days
This is probably the most immediately noticeable downside for a newcomer settling in Riga. Latvian winters are long, dark and cold, and it's not just a matter of perception. From November to March, temperatures regularly range between -5°C and -15°C, occasionally dropping to -20°C during cold snaps. Snow can stay on the ground from December through April.
But it's really the lack of daylight that catches newcomers off guard. In December, Riga gets only 6 to 7 hours of daylight per day, often under an overcast sky. For anyone from a sunnier southern climate, the shock can be real, and the risk of seasonal depression is well documented among expats from Nordic countries.
The upside: Latvian summers are gorgeous. From June to August, temperatures are pleasant (20-25°C), and daylight is nearly constant (up to 18 hours of light in June). Riga then shows a radiant side that few European capitals can match.
A very limited domestic market
With only 1.8 million inhabitants, fewer than a city like Lyon and its metropolitan area, Latvia offers an extremely small local market. For an entrepreneur whose target is exclusively the Latvian consumer, this is a clear handicap. Sales volumes, the market's absorption capacity, and the marketing budgets required must be calibrated accordingly.
On the other hand, for entrepreneurs operating internationally, in B2B, e-commerce, or digital services, the size of the local market barely matters. Latvia then functions as a European base of operations, with access to the entire single market, well-developed transport networks, and a growing startup ecosystem in Riga.
The Latvian language barrier
Latvian is a complex Indo-European language, quite far removed from Romance or Germanic languages. Its grammar is notoriously difficult, with numerous case declensions and a distinctive phonology. Learning Latvian represents a significant investment for most foreigners, and most expats who have lived in Riga for several years only master the basics.
In everyday life in Riga, English is sufficient in almost every situation. But in rural areas or certain public services (hospitals, provincial town halls, local administration), Latvian remains essential. If you're considering settling outside Riga, this barrier can become a real obstacle.
For entrepreneurs setting up an SIA without relocating, this point is largely irrelevant — see our guide on languages spoken in Latvia for all the practical details.
Geographic distance from Western Europe
Riga is about 2,300 km from Paris as the crow flies. Flight time is roughly 2h30 to 3h depending on the airline, with direct flights available from AirBaltic and several other European carriers. Connections are frequent from major hubs like Paris, London, or Frankfurt, but less frequent from smaller regional airports.
For an entrepreneur who only makes a few trips a year to Riga for meetings or administrative matters, this distance is perfectly manageable. However, if you're planning a weekly presence, the cost of flights and the fatigue of frequent travel need to factor into your calculations.
On the plus side: Latvia is only one hour ahead of most of continental Europe (Central European Time). There's no significant jet lag and no meetings at awkward hours.
A concerning demographic decline
Latvia has lost nearly 25% of its population since 1991, dropping from 2.7 million to under 1.9 million inhabitants. This decline stems from a combination of low birth rates and large-scale emigration to Western Europe (Ireland, Germany, the UK), particularly following EU accession in 2004.
This has practical consequences for the labour market: some sectors suffer from a shortage of workers, which pushes up salaries in skilled professions. For an entrepreneur looking to hire IT or finance talent, competition is real, and top candidates sometimes move abroad.
Overview: real but manageable downsides
These downsides deserve to be known and taken into account. But they need to be put into perspective against your personal situation and goals.
For a remote entrepreneur
- Winter doesn't affect you if you don't live there
- The local market isn't your target
- Language is handled by your service provider
- A 2h30 flight remains manageable for occasional trips
For physically relocating
- Winter can be hard to live through
- The local market is very narrow
- Learning Latvian becomes necessary
- Distance from family can weigh on you
For the vast majority of international entrepreneurs who set up an SIA remotely without relocating, these downsides are either non-existent or very marginal. The real issues for them are more about tax and legal matters — read our article on the risks of forming a company in Latvia to go further.
"The disadvantages of Latvia are real, but for an international entrepreneur setting up a company remotely, none of them undermine the project's rationale. These are more relevant to those considering physically relocating."
Don't confuse the two
The disadvantages of living in Latvia (this article) are distinct from the tax and legal risks associated with forming an SIA in Latvia. These two topics each deserve a separate analysis tailored to your project.