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LITHUANIA


 

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 13,796 12,000 11,300 78
         
GNI per capita
 US $ 3,660 3,350 3,080 83
Ranking is given out of 208 nations - (data from the World Bank)

Books on Lithuania

REPUBLICAN REFERENCE

Area (sq.km)
65,200 

Population 
3,592,561 

Principal 
ethnic groups 
Lithuanians 81.3%
Russians 8.4%
Poles 7.0%

Capital
Vilnius 

Currency 
Litas

President
Rolandas Paksas

  

Background:
Independent between the two World Wars, Lithuania was annexed by the USSR in 1940. On 11 March 1990, Lithuania became the first of the Soviet republics to declare its independence, but this proclamation was not generally recognized until September of 1991 (following the abortive coup in Moscow). The last Russian troops withdrew in 1993. Lithuania subsequently has restructured its economy for eventual integration into Western European institutions. 

Update No: 280 - (29/04/04)

The president is impeached
The inevitable has happened. President Rolandas Paksas was impeached on April 6th, ending a near six-month scandal. The Parliament, or Seimas, ousted Paksas 14 months after his installation in January 2003. They voted that he had violated his oath of office and Lithuania's constitution by his dealings with a Lithuanian-Russian businessman, Yuri Borisov, suspected of links to Russian organised crime. One could get away with such a wheeze if one was president of Belarus next door, but not in a Baltic state.
Paksas, the third post-Soviet president of the republic, was accused of improperly restoring citizenship to Borisov, owner of a helicopter manufacturer, Aviabaltika, which has been accused of illegal arms sales to Sudan. Borisov contributed $400,000 to Paksas's presidential campaign, and in return, according to parliamentary investigators, received preferential access to Paksas's office.
The groundswell of clamour for his impeachment became unstoppable after the country's State Security Department reported in the autumn that he had also leaked classified information to Borisov about investigations into his dealings. Paksas also faced a third charge of interfering in a privatisation deal. His fate was sealed when the constitutional court ruled that he had "grossly violated" the law in each case.
A minimum of 85 of Parliament's 141 deputies were needed to approve the impeachment, and they narrowly did so on each of the three counts. The number in favour that he improperly granted Borisov citizenship was 86 and that he improperly influenced a privatisation deal was 89. Lithuanian democracy, one can claim, was strengthened by the ordeal. It has shown that it has muscle as well as good intentions.

What next?
That, indeed, was the verdict of one of the impeachment process's main movers, former president, Vytautas Landsbergis. Landsbergis led Lithuania to its independence in 1990-91 and is an historic figure, who precipitated the collapse of the Soviet Union.
The main beneficiary of the event, however, may be his longstanding foe, the present premier, Algirdas Brazauskas, who may decide to bring a long career (which saw him as Lithuanian President in late communist times) to a dignified conclusion as president once again. He is over 70 and must find the grind of office rather trying.

Comeback for Paksas?
Curiously Paksas is not yet quite finished. He is seeking the presidency again. The Liberal Democratic Party has nominated him as its candidate for the June 13th election. Party members voted 353-0 to endorse his candidature, with two abstentions. 
Paksas still has a popular following in the backwoods, receiving as much as 40% in opinion polls. His antics as a stuntman give him an image of virility with the masses, while the sleazy side of his character has a perverse appeal for some. 'A real man,' not an android in the eyes of the folksy rural population. An upset in which he is returned cannot be ruled out.

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CONSTRUCTION

Zimmer to build large PET bottle plant in Lithuania


German group, Zimmer AG, was recently awarded a contract to build a polyester plant in Lithuania to produce chips for PET bottles, New Europe has reported. 
The value of the contract was placed at approximately €65m. The project, to be located in Klaipeda at the Baltic Sea, comprises a continuous plant and a solid state polycondensation (SSP), both designed for a capacity of 154,000 tonnes per year. The customer, the Austrian Petrochemical Holding GmbH, Vienna, is an international investment group.
The Frankfurt-based Zimmer will provide the technology, engineering, key equipment and will be responsible for the supervision of erection and start-up, which has been scheduled for the second half of 2005. Zimmer had previously been awarded a contract in November 2003 by Petrochemical Holding GmbH to build a polyester plant with the same capacity. It is also being built in Klaipeda and will have an annual capacity of 154,000 tonnes. Start-up is planned for the first half of 2005.
These projects, with a total annual capacity of approximately 310,000 tonnes, will make Petrochemical Holding GmbH one of east Europe's largest producers of PET bottle grade chips. On March 16th Petrochemical Holding GmbH and Zimmer AG signed a letter of intent to construct a third plant in the same region.
The first plant built by Zimmer in Eastern Europe, for approximately 55,000 tonnes of chips for PET bottles per year, was recently commissioned in Russia.

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ENERGY

Lithuania sells Russian firm one-third of gas company shares

After talks that lasted for nearly two years, the Lithuanian government and the Russian gas concern, Gazprom, have closed the deal on the sale of 34 per cent of the shares of the [gas company] Lietuvos Dujos. After Gazprom paid 100m litas [37m dollars] for the shares, the parties signed, in Vilnius, the deed on the transfer of one-third of the shares of Lietuvos Dujos and a document confirming the closure of the privatisation deal. They also signed the shareholders' agreement and a long-term agreement on the supplies of gas, Ziniu Radijas reported. 
The documents were signed by the head of the [Lithuanian] State Assets Fund, Povilas Milasauskas, the deputy board chairman of the Russian gas concern Gazprom, Aleksandr Ryazanov, the vice-president of the German concern Ruhrgas and the board chairman of Lietuvos Dujos, Eike Benke, as well as the general manager of Lietuvos Dujos, Viktoras Valentukevicius. The Lithuanian government will retain one quarter of Lietuvos Dujos' shares after the deal.

Lietuvos Energija 2-month exports shrink 13%

Lithuanian power company, Lietuvos Energija, exported 1.8bn kWh of electricity in January-February 2004, down 12.6% from 2.06bn kWh during the same period in 2003, a source in the company's press service said, New Europe reported. 
Most of this electricity was exported to Russia - 992.2m kWh, and Belarus - 698.3m kWh.
In February Lithuania exported 801.6m kWh of electricity, which is 17.9% less than in the same month last year. Lithuania planned to export 980m kWh of electricity in March. The press service said that company Director General, Rymantas Juozaitis, forecasts that electricity exports this year will fall to 6.6bn kWh due to preparations for the closure of the first power-producing unit at Ignalina Nuclear Power Plant, which should be halted by the end of 2004 under an agreement between Lithuania and the European Union.
Lietuvos Energija exported 6.8bn kWh of electricity in 2003, up 10.3% from 2002. The state owns 96.62% of shares in Lietuvos Energija.

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FINANCIAL NEWS

Gold, forex reserves down 3.5% in February

Lithuania's gold and foreign-exchange reserves decreased by 3.5% or 330.4m litas to 9.037bn litas during February, the Bank of Lithuania said, New Europe reported recently. 
The reserves fell 5.2% or 492.1m litas in January-February this year but grew 8.2% or 685.4m litas in the 12 months to the end of February. The reserves fell in February this year because commercial banks bought 155.4m litas in foreign currency more than they sold to the Bank of Lithuania and because government forex transactions reduced the reserves consisting of 201.8m litas of gold, compared with 206.3m litas at the end of January, and 200,000 litas in Special Drawing Rights (SDR), compared with 900,000 litas. The litas is pegged at 3.4528 against the Euro.

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FOREIGN ECONOMIC RELATIONS

Lithuanian delegation talks business in Pakistan

A three-member Lithuanian delegation led by Evaldas Ingnatavicius, Under Secretary of the State of Lithuania called on Pakistan's Secretary of Commerce, Kamal Afsar on March 11th, New Europe reported recently. 
The Secretary of Commerce apprised the delegation of the economic activities of Pakistan and deliberated on Pakistan-EU relations and termed them warm and cordial. However he pointed out that there were a few irritants like the EU's imposing of 13.1% anti dumping duty on Pakistan's exports of bed linen to EU. He hoped that once Lithuania joins the EU formally in a short time, Lithuania would be empathetic of Pakistan's position since its exports sector was heavily dependent on the textile sector. The delegation declared that, although Lithuania is small country with small population yet they have promising exports and imports. The Under Secretary of State of Lithuania hoped that future prospects of Lithuania would be brighter after joining the EU.
The Under Secretary further said that Business Organisations of both the countries should exchange visits at frequent intervals. Lithuania would get the biggest financial assistance per capita from the EU. He said that both countries had complimentary economies; therefore there are future prospects in trade to the benefit of both. The delegation further informed that they had excellent laser technology and cheap fertiliser from which Pakistan might benefit. Kamal Afsar informed them that most of Lithuania's exports were textile related and Pakistan could export excellent fabric to Lithuania. The Secretary of Commerce agreed with the views of the delegation and told them that the first step was to initiative people to people contact so that the business communities of both the countries could understand each other's markets.

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