The late 1980s and early 1990s were a time of rejoicing throughout Eastern Europe as most people celebrated the fall of communism. Still, the lifting of Soviet rule created difficulties.
One challenge was the releasing of ethnic tensions in the Baltic States that had been held down by Soviet rule. This was especially true in Estonia and Latvia, which have large Russian populations. In fact, Latvians make up little more than half of the people of Latvia. Many favor measures to limit Russian influence, including limiting the use of the Russian language and making it more difficult for Russians to become citizens.
A second challenge has been the economy. All three Baltic States have privatized their economies in the wake of Soviet rule. In 2004, all of them joined the European Union. This has promoted trade with countries other than Russia and has encouraged foreign investments.
In addition, the Baltic States, small and with limited natural resources, have succeeded in diversifying, or increasing the variety of, their economies. In Estonia, most people work in services and industries, such as mining, shipbuilding, and manufacturing. Latvia's industries are extremely diversified. They include motor vehicles, pharmaceuticals, and electrical equipment. Major Lithuanian industries include food processing, shipbuilding, and the manufacture of machinery.
