The aim is to provide a comprehensive and multidisciplinary assessment of the impact of Covid-19 pandemic on Latvia’s economy and to produce scientifically grounded and innovative policy recommendations of interdisciplinary nature with regard to overcoming the challenges posed by the Covid-19 pandemic to sustainable and inclusive economic development of Latvia. Methodology-wise, the focus will be on the most critical branches of Latvia’s economy: export industries, agri-food sector, transportation and banking. The assessment and prognostication will be carried out considering the microeconomic (enterprise level), macroeconomic (state level), sociological and legal aspects. Processes that have the potential to cause structural / institutional changes in the Latvian economy will be monitored.The risks stemming from international political developments will be addresses as well. The projects outcomes: (1) a critical assessment of the existing policy approach to mitigating the costs of the pandemic; (2) a prognostication of the future direction of Latvia’s economic development, taking into account the dynamics of both domestic social and international political developments; (3) a new set of scientifically grounded and applicable policy recommendations for policy-makers.