Riga, a city revelling in its culture

In central Riga, people are laying flowers beneath the Freedom Monument. It's a green statue of a woman holding three gold stars on top of a 42-metre stone pillar at the end of a broad, busy street. One woman explains to me that it's the 65th anniversary of the day in 1949 when 42,000 Latvians were deported to Siberia by the Soviet government. She still remembers hiding underground and finding the neighbours' house empty the next day. "Only the dog was left," she says.

In Riga, Latvia's capital city, the past is alive – and complicated. The road that the monument stands on is now called Brivibas bulvaris (Freedom Boulevard), but its previous names – Alexander, Hitler and Lenin – are a clue to the city's history of rule by foreign powers. It was founded in 1201 as a base for crusading German knights, and for three centuries it thrived as one of the Baltic ports in the Hanseatic League. In turn, Riga then became part of the Polish-Lithuanian Commonwealth, and then the Swedish and Russian empires. You can sense this history in the cobbled streets of Riga's old town, which is bounded by the river Daugava and the city canal (previously a moat), and in its architecture – best expressed in the flowing lines of the largest collection of art nouveau buildings in the world.

To mark its status as European Capital of Culture 2014, hundreds of small projects are aiming to explore Riga's rich heritage, while also looking to its future. Monument Wars is a new art installation on Brivibas boulevard, where a Lenin monument once stood. Designed to illustrate different influences on the city, it is made up of four alternating sculptures, including a Virgin Mary and a black-skinned Barbie in Swedish dress.

Saint Peter's church. Photograph: Getty Images

Despite the prettiness of the historic areas, more recent developments in Riga give it an overall air of shabby and slightly chaotic grandeur. From the spire of St Peter's church, you can see how the city spreads out from the old town, through art nouveau extravagances, to Soviet apartment blocks, skyscrapers, bridges and the Eiffel-esque TV tower. Just south of the city canal are the five former Zeppelin hangars that make up the Central Market, their cavernous interiors holding stall upon stall of smoked fish and fresh vegetables. On one side of the Freedom Monument is Bastion Hill park, where the city ramparts used to be – one of many pleasant green spaces in central Riga. It contains five stones marking the places where Latvians were shot in the Soviet army's final bid to maintain control before their country regained independence in 1991.

The recent history of Latvia has not always been happy, but the city is changing fast. The stag parties that flooded into the old town when cheap flights began have decreased, though Riga still operates a "tourist police". However, only revellers with a passion for high-quality locally sourced ingredients will dine atValtera restaurant, which puts an imaginative modern twist on traditional Latvian cuisine, making its own bread and serving local fruit wines.

The most exciting parts of the city now lie beyond the traditional tourist haunts. On a predictably fruitless search for a new laptop charger, I walk drained intoIlluseum, north of the centre at 19 Miera iela (Peace Street). It's an atmospheric tea shop decorated with patterned rugs and cushions and displaying myriad leaf teas. The server (or as she calls herself, "tea master"), recommends an energising cold pu-erh tea "cocktail" with sharp berries, which seems to do the trick, and explains that this quiet, cobbled road has a different feel from the rest of the city.

Illuseum tea shop at 19 Miera iela (Peace Street)

Illuseum opened here four years ago. Starting up at around the same time wereDAD cafe at no 17, with art on the walls and a piano, and Buteljons at no 10, which upcycles wine and beer bottles to make clocks, glasses and mirrors. And there are new places opening here all the time. DAD co-owner Dace Preisa says her decision to open here was partly inspired by the aroma wafting from the Laima chocolate factory (there since 1939). "I had a feeling that there was something special about this street."

AdvertisementReport this ad"The Republic of Miera iela" began as a nickname for the area and its businesses, but has now become an official body (mieriela.lv) that runs an annual festival and can apply for government funding. Many comparable new ventures have sprung up elsewhere in Riga in the past five years, sometimes clustered in particular areas.

The Spikeri dock's warehouses (next to the central market), were recently cleaned up by the government. The Kim Contemporary Art Centre (kim.lv) opened there five years ago and has been joined by creative businesses, a chamber orchestra, and restaurants.

On the other side of the Daugava (a tram ride away) at Kalnciema kvartals, local entrepreneur brothers have bought and restored all the decaying wooden buildings on a square surrounding a small orchard. It now hosts an array of establishments including a cafe, a wine shop and an art gallery, all fitting the elegantly rustic ethos. In one corner is Maja restaurant, where painted walls, plaster ceiling decorations and even a glass window have been retained from the old building. The square is a public space, holding a weekly farmers' market, concerts, outdoor film screenings and more.

While Kalnciema and Spikeri now feel rather upmarket, other projects operate amid constant insecurity. Since 2012, the scruffy but welcoming Kanepes cultural centre, founded by 28-year-old local Davis Kanepe, has been a natural home for Riga's young and alternatively-minded, acting as a bar, music venue, cinema and much more in an old music school which they use rent-free in return for renovating it.

Bar in the Kalnciema Quarter

"We try to break the stereotypes. Culture is not just classical exhibitions and plays," says programme manager Laura Adamovica.

AdvertisementReport this adSimilar projects have had to leave their original locations – sometimes because of the very gentrification they helped start. But while not everything lasts, there always seems to be something new emerging – thanks partly to the 2008 financial crisis, which fostered a nothing-to-lose attitude, as well as low rents. Even the emigration which this prompted can have its positive side if people return. Adamovica echoes many when she says that there is a new open-minded and entrepreneurial spirit among young Latvians, which she thinks is linked to more people spending time abroad:

"People come back and start to believe they can do something – not just picking mushrooms, but starting a tea shop."

This younger generation is nonetheless well aware of the weight of history on modern Latvia. Kanepe disbelievingly rolls off a list of the powers to have held sway over the country. "And yet we still speak our language How is this possible?"

In showing such determination to survive against the odds, he perhaps answers his own question.