Latvian Prime Minister Evika Silina told reporters she will push a state loan for the flag carrier, even if it jeopardises the ruling coalition’s cohesion ahead of elections. The bailout, she said, is essential to keep the airline afloat and protect jobs tied to the country’s tourism‑dependent economy. Her stance comes with roughly six months before voters head to the polls.

Finance officials estimate the package will total €30 million (about $35 million), a sum that would cover immediate cash‑flow shortfalls and enable Air Baltic to meet leasing obligations. Investors have watched the carrier’s balance sheet deteriorate after pandemic‑induced travel drops, and a government infusion could restore creditor confidence. Yet opposition parties warn the move risks inflaming fiscal debates as Latvia grapples with a modest budget surplus.

By prioritising the airline, Silina signals that preserving a strategic asset trumps short‑term political calculus. Market observers note that a state‑backed loan could stabilise Air Baltic’s share price and limit a cascade of defaults among regional carriers. The decision underscores how governments in small economies may intervene directly when private financing dries up in the near term.