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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 18,213 13,796 12,000 74
GNI per capita
 US $ 4,490 3,660 3,350 74
Ranking is given out of 208 nations - (data from the World Bank)

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ethnic groups 
Lithuanians 81.3%
Russians 8.4%
Poles 7.0%



Valdas Adamkus

Update No: 295 - (26/07/05)

Lithuania celebrates its only king
Various solemn ceremonies and informal cultural events were held on July 6th to celebrate the coronation of King Mindaugas, Lithuania's only king. 
The national holiday commenced at the President's office, where the head of state distributed national awards. It included folk festivals, rock concerts, and a medieval fair. 
President Valdas Adamkus delivered a speech at S. Daukanto Square near the President's Office at noon. Later on, Holy Masses were held at Vilnius Cathedral. The city's squares and parks were alive with choir children, and the international folklore festival Baltica offered both song and dance. 

Adamkus suggests that Uspaskich, Zuokas resign
Lithuania, however, remains a very presidential republic for all that. President Adamkus is a septuagenarian who spent fifty years in the US. He is not tainted with a communist past, nor that matter with any covert connection to Moscow, unlike his predecessor, Rolandas Paskas, a former premier and mayor of Vilnius too. Adamkus has great moral authority in Lithuania, which he is not afraid to deploy.
In a nationally televised address on May 30th, the president made his weight felt in both national and local politics. He said that he had lost confidence in Economy Minister Viktor Uspaskich and Vilnius Mayor Arturas Zuokas. Although the president did not name either politician, it was clear in which direction the wind was blowing. 
"Recently, there has been much discussion about the mutual allegations between the two leaders of parliamentary parties. This sorting out of the political relations damages the interest of the state and the municipality, it discredits them in the eyes of the public," the president said. "Bearing witness to it, I address law enforcement institutions and urge them to investigate immediately the disturbing suspicions and to present their legal assessments." 
Uspaskich heads, or rather headed, the Labour Party, a ruling coalition partner, and Zuokas the Liberal and Centrist Union, which is currently in the opposition. 

Zuokas not to resign as Vilnius mayor
Arturas Zuokas said on July 3rd that he has no intention to resign as Vilnius mayor, despite having fallen out of favour with President Adamkus. 
"Firstly, I have suspended my powers as party leader, as it was mentioned in the president's statement," he said in a radio interview. "And what concerns my position at the municipality, this, without a doubt, will depend on the faction's and council members' confidence and joint work. For me personally and for my colleagues, it is of utmost importance to retain Vilnius City Council capable of working," Zuokas said. 
Zuokas has been bogged down in a war of accusations with Uspaskich, who resigned in early July from his positions as economy minister and MP. The two men, both millionaires, accused each other of using his public office for supporting private interests, and their exchange became so vitriolic that the president felt compelled to ask both men to resign for the sake of the country. 

Brazauskas the fixer
The other figure that really counts in Lithuania is Prime Minister Algirdas Brazauskas. He is a real stayer, the former communist chief who initiated the country's move towards independence by taking the Lithuanian Communist Party out of the Soviet Communist Party in 1990, with the crucial approval of the then president of the Russian Federation, itself still in the USSR, Boris Yeltsin.
Brazauskas is still a master at political compromise, which is why he has steered so many coalition governments successfully in Lithuania, where they are the only form of governance possible. Dealing with the most recent spat, he said that there was no need to revise the ruling coalition's agreement in light of the resignation of Uspaskich, whose Labour Party represents the most seats in the coalition he leads. Uspaskich stated he was resigning as economy minister and giving up his MP mandate, hence presumably the leadership of his party. 
"I see no need to revise it now. Why should we revise?" Brazauskas said, referring to the ruling coalition's agreement, after a Cabinet meeting in mid-July. The Labour Party's ruling council, indeed, decided on the same day that it would stay in the ruling coalition and would propose Kestutis Dauksys as the new economy minister.
In fact the resignation of ethnically Russian Economics Minister Uspaskikh and his leaving the parliament is seen by the national mass media as a huge victory of "the free European Lithuania" over "the retrograde imperial Russia." "Symbolically, the leader of the Labour Party sent in his resignation papers to Lithuania from Russia, and his visit there looks more like a flight than an official visit of a statesman," said Lietuvos Ritas on June 18th. 
After the general parliamentary elections in October last year, the ruling coalition was formed by four political parties -- the Social Democratic Party, the New Union (Social Liberals), the Labour Party and the Union of Farmers and New Democracy Parties. 

Lithuania annoyed by lack of invitation to Kaliningrad
Lithuanian officials have expressed surprise and disappointment at having not been invited by Moscow to the anniversary celebrations in Kaliningrad in the beginning of July. Neither neighbouring Poland nor Lithuania have received invitations to take part in the 750th anniversary celebrations of the city of Kaliningrad, formerly Konigsberg, and part of the area still known to many as "little Lithuania." 
"If Germany's Chancellor Gerhard Schroeder and Russia's President Vladimir Putin are indeed attending the festivities in Kaliningrad without the participation of the immediate neighbours and will be inaugurated honorary doctors of the Kaliningrad University, that will be a significant mark in the Moscow-Berlin relationship," Foreign Minister Antanas Valionis told the Baltic News Service beforehand. 
The foreign minister was equally surprised by Germany's behaviour as Russia's. "We are demonstrating immense goodwill in dealings with German diplomats, working on a basis of mutual understanding, although sometimes it may seem that some of the actions of the German political authorities do not fully take account of the historical and political tender spots of our region." 
Raimundas Lopata, director of the Institute of International Relations and Political Sciences of the Vilnius University, said the obvious display of disregard towards Lithuania and Poland is part of the Kremlin's attempts to play the Kaliningrad card to realize its political goals. 

Poll: Two thirds of Lithuanians don't use birth control
Actually the Russian connection plays second fiddle in Lithuania to Rome. It is a profoundly Catholic country, like Poland. This accounts for its steady birth-rate.
Over two-thirds of Lithuania's residents do not use modern birth-control methods, a recent RAIT poll has shown. According to Esmeralda Kuliesyte, director of the Family Planning and Sexual Health Association, the survey aimed to discover how Lithuanians protect themselves from unplanned pregnancy, what determines their selection of contraceptive methods, and society's attitude toward modern birth-control. 
The poll confirmed fears that the birth control situation is more than critical, Kuliesyte noted, as 70.1 per cent of respondents said they used no contraceptive devices. Merely 27 per cent of respondents said they used contraceptives, the most common being condoms (18.5 per cent) and birth-control pills (7.2 per cent).

Germans takes over Baltic NATO mission
If Lithuania's spiritual security is provided by Catholicism, its more mundane security is premised on its new-found NATO membership. German Air Force servicemen took over the NATO sanctioned three-month Baltic air-policing mission from a Dutch contingent on June 23rd. Some 50 German servicemen will patrol the airspace above Lithuania, Latvia and Estonia with four F-4 Phantom jet fighters. 
Manufactured by the US company McDonnell (later McDonnell-Douglas), the multipurpose fighter Phantom first took off in late May 1958. The last Phantom was manufactured in October 1979. The aircraft is still used by the armed forces of nine countries, although the United States stopped using these jets in 1996. 
The German Air Force has recently been modernizing its aircraft park. Phantom and Tornado fighters are replaced by state-of-the-art Eurofighter EF2000 Typhoon. Therefore, the mission of Phantom fighters in Lithuania may be one of their last in the German Air Force. 
According to a press release from Lithuania's Defence Ministry, the Aircraft Control Unit of the Norwegian Royal Air Force's mission in Lithuania also ended on June 23rd.

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Lithuanian Air sale nears end 

The Lithuanian government appears set finally to sell its loss-making national air carrier Lietuvos Avialinijos (LAL) at the second attempt, and to catch up with its Baltic neighbours which privatised their airlines several years ago, Deutsche Presse-Agentur (dpa) said in a report recently. 
The Lithuanian State Property Fund initialled an agreement for the sale of a 100 per cent stake of the country's national air carrier Lietuvos Avialinijos (LAL), and planned to finalise the deal by the end of July. 
So far the fund has not officially disclosed the name of the investor, but Fima, Lithuania's leading electronics and engineering systems solutions company, said it won the tender, outbidding three other competitors. 
Fima says it offered to pay over 20m litas (US$7.05m) for LAL and to invest up to 28m litas into the company. 
According to the privatisation conditions the potential investor was obliged to boost LAL's authorised capital by no less than 10m litas within two years. 
"Lithuanian Airlines will become profitable within three-to-four years," says Vaidas Barakauskas, president of Fima. "It will to be a serious competitor for both Baltic and central European airlines." 
"We want to create a totally new concept for economy flights and to offer more high quality services for a low price," says Barakauskas. While Firma's chief executive says that LAL will offer low-fare flights, these would be different kind of service compared to those currently offered on the market. 
Because LAL will retain its status as national carrier, the airline's new owner also expects the government support in the competition. 
A major part of the planned investment programme will be the acquisition and lease of new aircraft, the construction of a new hangar, which will service more clients and ensure an additional 3.5m litas in revenue annually. 
According to Barakauskas there is also a big potential for boosting cargo services. 
In addition, the group is planning to introduce greater automation into the airline as well as installing an electronic luggage control system, internet ticket sale network and a call centre. 
To ensure the success in revamping LAL, Fima has signed cooperation agreements with a Lithuanian charter flight company Aurela and Tez Tour, an international travel agency of the Russian capital, which specialises in organising tours to Egypt, Thailand and Turkey. 
Aurela, which has Boeing 737-300, JAK-42D and Hawker HS125-700 type aircraft, flies to European, Asian and African countries. 
Along with three Lithuanian companies and consortiums, an Icelandic investor Fengur, which runs cheap flight companies Icelandic Express and Sterling were competing to buy LAL. 
LAL, which at the start of this year represented 48 per cent of regular flights operating from Vilnius airport, is facing an increased competition in the coming months from Ryanair. 
The Irish low-fare airline is planning to launch flights from Karmelava airport near the nation's second-largest city of Kaunas. 
Under the deal to buy LAL, Fima is to retain no less than 80 per cent of the airline's jobs for one year and will not be allowed to trade the stock of the company without the permission of the government for two years. 
The new owner will have to take over LAL's debt of about 30m litas. 
LAL, which suffered a net loss of nine million litas in 2004, has forecast a 3.95m litas profit this year. 
The number of travellers jumped last year by 41.7 per cent, while sales rose 11.6 per cent to 222m litas. 
The airline has also entered 2005 on a strong footing with the number of LAL passengers jumping by 43.9 per cent in the first five months of this year compared to the same period last year. 

Ryanair to fly to Kaunas 

Lithuania's Kaunas airport said on June 20 that it concluded negotiations with Ryanair Holdings Plc to begin flying to the Baltic state, New Europe reported. 
"The negotiations are finished, but all the details are to be announced by representatives of the Irish company," said Kestutis Cucenas, head of Kaunas airport. The transport ministry earlier said that it was ready to provide the necessary infrastructure for Kaunas airport and would organise public transport from Vilnius to the second-largest city, some 100 kilometres (60 miles) away.

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ConocoPhillips eyes Mazeikiu Nafta oil refinery 

US oil refining giant ConocoPhillips said it was interested in buying shares in Lithuania's Mazeikiu Nafta oil refinery, currently majority-owned by Russia's ailing YUKOS oil giant, New Europe reported.
"We are one of the largest refinery owners in the United States and one of the largest in the world, so it is a natural possibility and opportunity for our company to invest in that refinery," James Mulva, president of ConocoPhillips, told journalists after meeting with Lithuanian Prime Minister Algirdas Brazauskas. 
YUKOS currently holds a 53.7 per cent stake and management rights in Mazeikiu Nafta, the sole refinery in the Baltics, while the Lithuanian government owns 40.6 per cent of the company, which includes a refinery, the Butinge offshore terminal and a pipeline. 
YUKOS is facing bankruptcy, as the Kremlin slowly dismantles the oil giant to pay a tax bill that it says stands at more than 10 times the company's market capitalisation. 
The Lithuanian government is in negotiations with YUKOS to take over an option from the Russian company to buy 9.72 per cent of newly issued Mazeikiu Nafta shares. Such a move would give it a majority stake in the refinery. 
Brazauskas said in a statement after meeting with Mulva that ConocoPhillips is interested not only in the stake owned by YUKOS, but also in the possibility of buying shares from the government. 
"But it will depend on YUKOS, first of all, to decide who will be the buyer of Mazeikiu Nafta shares," Brazauskas added. 
Mulva said ConocoPhillips would invest with partners in Mazeikiu Nafta and named Russia's LUKoil among them. ConocoPhillips bought an 11.3 per cent stake in LUKoil in March this year. 
ConocoPhillips is the sixth company to have expressed an interest in Mazeikiu Nafta. Gazprombank, LUKoil, the Russian-British venture TNK-BP, the international group Vitol and Kazakstan's state-owned KaMunGaz, have already stated an interest in the Lithuanian refinery. 
Up to 15 million tons of crude can be processed at the Mazeikiu refinery and 14 million tons can be exported via the Butinge terminal. 
Mazeikiu Nafta earned net profit of 721.8m litas (209m Euro, US$260.8m) last year, a three-fold increase from the 2003 net profit of 220.9m litas. Around 8.66m tonnes of crude were refined at the Lithuanian refinery in 2004, or 1.5m tonnes more than in 2003. 

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Lithuania, Azerbaijan talk ties

Speaker of the Lithuanian Seym (parliament) Arturas Paulauskas arrived in Baku on an official visit on June 5th, Azertag reported.
He was welcomed at the Heydar Aliyev International Airport by speaker of the Milli Majlis (parliament) of Azerbaijan, Murtuz alasgarov, and the first deputy speaker, Arif Rahimzade. Paulauskas told reporters that his visit was aimed at negotiating further cooperation between the two countries in political, economic, cultural and other fields, as well as strengthening of inter-parliamentary ties.

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