Books on Lithuania
Update No: 299 - (28/11/05)
Mazeikui Nafta affair recurs once more
There is a rather entangled imbroglio unfolding that concerns the prime
minister's wife and the privatisation of Lithuania's prime energy asset, the
Mazeikui Nafta oil refinery. It could bring an end to the long career of Prime
Minister Algirdas Brazauskas, who was the last communist president of the
Before going into the details, it is worth setting the matter in an historical
context. A good guide to the affair is David Aaronovitch of the Times, who
recently travelled thither in a return to the land of his forefathers.
"One final day's train journey takes me northeast to the industrial town of
Bialystok and then due north, through stands of silver birches into Lithuania,
the country that my father's parents left a century ago."
"Beside the tracks are small farms with a horse, a pig, six or seven geese
and an elderly man and woman doing the chores. In the cities, however,
everything is changing. On the north bank of the Neris River in the capital,
Vilnius, there are new buildings going up everywhere. Lithuania is a success
story. Economically, at any rate."
"Politically it's another matter. I travel by bus to the second city,
Kaunas, to meet Leonidas Donskis, Dean of the Political Science and Diplomacy
School at the Vytautas Magnus University of Kaunas, a smiling, bright man and
presenter of a non-confrontational current affairs programme. He shudders when I
mention the pipeline and energy policy. "The whole country's political
life," he tells me, "has revolved around this question." "
"It went something like this. A few years back there was a split between
President Adamkus and his Prime Minister, Rolandas Paksas, on the issue of
whether the Mazeikiu Nafta state oil refinery should be sold to the American
Williams corporation. The Russians also wanted the refinery, and this contest
led to Paksas standing for the presidency on a populist anti-American ticket,
backed by Russian money and PR companies. Paksas narrowly won the election and
Yukos got the refinery.
" 'The Russians,' says Donskis, 'backed Paksas.' Unfortunately for them
their man was subsequently accused of corruption, impeached and dismissed from
office. Last year Adamkus was re-elected. Donskis remains disgusted and marks a
relationship that has been visible on other parts of this journey. 'There is a
fusion of the media world, politics and business and this fusion is a big
problem. It is a shamelessly obvious feature of public life. 'Lithuania,' he
continues, 'escaped this time. But there is no normal political life. The
nouveau riche can simply rule our political system.' "
"Every time this class fails, it reinvents itself through populism. And
though the economy is dynamic and foreign policy - the work of young technocrats
- is respected abroad, he believes that what he calls the
"degeneration" of political life will catch up with the economy
eventually and drag it down. Donskis reposes his confidence in the young and in
civil society more than in conventional politics which, he characterises as
appealing to the worries of the old. Maybe in five to ten years, he muses, the
students whose laughter we can hear coming from a nearby lecture theatre will be
able to influence politics in a less corrupt, more open, more progressive
Premier strikes back
Brazauskas rebuts all charges of wrongdoing and is particularly incensed at
attacks on his wife. Fed up with the opposition's relentless prodding into
family business, Brazauskas launched a major counterattack on October 21st,
appealing to prosecutors to investigate what he claimed was slander of his and
his family's name.
The plea, however, fell on deaf ears, as Deputy Prosecutor General Gintaras
Jasaitis told journalists on October 25th that prosecutors would not open a
defamation of character case on request of the head of government. Jasaitis said
both Lithuania's Supreme Court and the European Court of Human Rights have
repeatedly ruled that criticism toward political figures can be more rigorous
than criticism of private individuals.
For weeks now, the Homeland Union (Conservatives) have been hounding Brazauskas'
wife, Kristina Brazauskiene, and her hotel business. They are suspicious that
her relations with Ivan Paleychik, head of Lukoil Baltija, a branch of the
Russian oil giant that is currently lobbying to buy Mazeikiu Nafta, may affect
the Cabinet's objectivity in assessing who will take control of the country's
prize industrial asset.
The Chief Official Ethics Commission ruled recently that the prime minister was
not involved in a conflict of public and private interests and should not bow
out of Mazeikiu Nafta privatization matters due to his wife's links with Lukoil
This, however, didn't stop the opposition. It collected enough signatures to
form a parliamentary ad hoc commission to investigate the sale of Brazauskiene's
Crown Plaza hotel. But Brazauskas said that not only would he refuse to give
testimony to any ad hoc commission, but he would also withdraw from the
government if his hand was forced.
In the meantime, the prime minister has asked the Prosecutor's Office to launch
an investigation against Conservative leader Andrius Kubilius and MPs Jurgis
Razma and Rasa Jukneviciene.
The scandal comes at a time when the coalition government's stability is as
precarious as ever. Indeed, the opposition wasn't alone in signing a petition to
investigate Brazauskas' family business. MPs from the Labour Party faction,
coalition partners, joined the effort.
Lithuanian leader faults EU over new gas pipeline
Energy issues are paramount in international politics too. President Adamkus
said on October 26th that the European Union's foreign policy was being set by
individual member states that were more concerned with pursuing their own
national interests than establishing a common, long-term strategy for dealing
with crucial issues, such as energy security and Russia. Adamkus, who presides
over a small country of 3.7 million people that won its independence from the
former Soviet Union in 1991, made membership of the EU and NATO the cornerstone
of Lithuania's foreign and security policy, reported Judy Dempsey in The
International Herald Tribune of October 27th.
Adamkus, whose country and seven other former Communist countries joined the EU
in May 2004, said Brussels had made no effort to engage or inform countries that
would be directly affected by a new gas pipeline Russia is building under the
Baltic Sea with financial and technical support from Germany. "This is an
example of how things are in the EU," Adamkus said during a two-day
official visit to Germany where he met with Chancellor Gerhard Schröder, who
has politically supported the North European Gas Pipeline. Once complete, the
pipeline will allow the Russian state-owned energy company Gazprom to transport
gas directly from Russia to Europe, bypassing the Baltic States and Poland.
"We felt the pipeline was a vital element concerning our future,"
Adamkus said at a meeting of the German Marshall Fund of the United States in
Berlin. "I told Schröder what I thought. But he said it was a done
deal." Schröder, who during his seven-year term as chancellor developed a
close relationship with President Vladimir Putin of Russia, dismissed Adamkus's
criticisms. In a statement issued by his office, Schröder said, "Germany
has a sovereign right to take steps to make sure it has reliable and sustainable
The pipeline, which will give Gazprom the chance to diversify its transmission
routes to Western Europe, will stretch from Vyborg, near Saint Petersburg in
Russia, to Greifswald, in Germany, where it will then spur off to Scandinavia
Gazprom said recently that the plan was to build two parallel gas pipelines,
each about 1,200 kilometres, or 750 miles, long. Completion is scheduled by
2010, although work has yet to begin. Total annual capacity would be 55 billion
cubic meters, or 1.9 trillion cubic feet. The costs would range between US$6
billion and US$8 billion.
Estonia, Latvia and Lithuania as well as Poland are concerned that they could be
left potentially vulnerable with regard to secure energy supplies since they
depend on Russia for their gas imports. They would also be denied transit fees
they earn from Russian gas that passes through their countries to Western
Even though Lithuania tried to muster some support among EU countries, Adamkus
said the EU raised no questions over the deal. "Being a member of the same
EU," he said, "at least we could have been informed and invited to sit
at the same table and discuss the advantages and disadvantages. We are, after
all, speaking for the EU now. Our state border is the eastern borders of the EU."
Antanas Valionis, Lithuania's foreign minister, said, "The pipeline affects
our interests and the energy security interests of the EU." He said Russia
was determined to press ahead with the pipeline "in order to have the
possibility to use pressure on us, if needed."
Neither Lithuania nor Poland, however, seem to believe Gazprom would cut off gas
supplies to them since that would seriously damage Gazprom's credibility as a
reliable exporter of gas to the EU, where it supplies a fifth of Europe's total
gas needs. This is surprising as at this time, Gazprom appear to be threatening
Moldova with cutting off supplies of the behest of the Russian foreign ministry.
Valionis said Russia resented the role played by Poland and Lithuania in the EU,
where they have been increasingly outspoken over the need for Brussels to adopt
a much longer-term strategic policy toward Ukraine and Belarus. Poland and
Lithuania also played an active role in mediating Ukraine's Orange Revolution
last December, much to Russia's annoyance.
"The point is that Russia does not like our active Eastern policy,"
Lithuanian diplomats said that they knew it would be almost impossible to
reverse the decision over the pipeline, which was decided in April by Gazprom
and German companies and which was signed in September when Putin visited Schröder
in Berlin. Chancellor-designate Angela Merkel and her Christian Democratic Party
have said the deal is closed.
Closure of another sort
US Ambassador Stephen Mull said that NATO was considering ways to improve
airspace security after the recent incursion of a Russian fighter jet into
Lithuanian territory. "On all of our minds in the aftermath of the
incursion of the Russian fighter jet and crash in Lithuania, is the question of
NATO's more immediate security guarantees," he told students at Siauliai
University at end-October.
"Some suggest the incident shows that NATO's security guarantee is hollow.
But anyone who would believe that is badly mistaken. No air policing arrangement
can prevent such incursions into NATO air space; just as it was impossible to
prevent the crash of a Soviet fighter jet in Norway at the height of the cold
war in 1978," Mull said.
He stressed that the alliance took the incident "very seriously" and
is looking into ways to improve the air policing system.
A US Air Force contingent took over the rotating air policing duty from the
Germans at end-October. The three-month mission will have been handled by some
100 service troops, which is nearly twice as many as any of the allied
contingents that have served in the mission so far, the Baltic News Service
Baltic presidents want to join Russian gas pipeline
The presidents of Estonia, Latvia and Lithuania agreed in a summit
recently to work together to be included in a proposed Russian-German gas
pipeline under the Baltic Sea that under current plans would bypass the three
countries, Deutsche Presse-agentur (dpa) reported.
The proposed pipeline has drawn criticism from Poland, and was one issue during
talks between Lithuanian President, Valdas Adamkus, and German Chancellor,
Gerhard Schroder, during a recent visit to Germany.
Adamkus met with his Latvian and Estonian counterparts, Vaira Vike-Freiberga and
Arnold Ruutel, to discuss regional cooperation at an annual rotating summit of
the Baltic states near the Estonian capital Tallinn.
The Baltic presidents cited the environmental dangers the proposed gas pipeline
would pose if laid under the Baltic Sea, and vowed to cooperate on the issue in
addition to others concerning regional infrastructure. "It is obviously
necessary for all of us to coordinate actions and properly represent regional
interests in the EU. To this end, it is important that cooperation be expanded
at all levels," Adamkus said at the summit. Cooperation is also planned to
implement a regional rail network, dubbed Rail Baltica, and a highway system,
named Via Baltica.
Lithuania, Poland, Russia sign border deal
Officials of Lithuania, Poland and Russia signed in the Lithuanian capital
recently an intergovernmental agreement on the establishment of the junction
point of the three countries' state borders. Foreign Ministry's Ambassador at
Large, Alexei Obukhov, signed the document on behalf of Russia, Itar-TASS News
The point of junction of the state borders established by the sides is named
"Vistitis" on the map and is located three kilometres from the lake
with the same name on the Polish state border line.
Obukhov said at the signing ceremony, "This intergovernmental agreement is
an important practical step legally formalising the delimitation of borders and
a simultaneous beginning of the state border demarcation between Russia and
3G Network launches in Lithuania
Under the brand name Neltes tinklas a 3G TDD network has been launched in
Lithuania. The first network in the Baltic States based on the 3G UMTS TDD
standard supports full mobility and data transfer speeds of up to 3 Mbps, New
The company plans to sign agreements for wholesale data transfer services with
its first customers in the near future. Network deployments have already started
in Vilnius and will continue in the major cities of the country. "We are
very happy to be the first to introduce a next generation wireless broadband
network in the Baltic States. With the new technology, we will offer high speed,
simple to use services that will change how people in Lithuania use the
Internet," said Darijus Klusas, CEO of UAB Neltes tinklas. "I am happy
that we will have a next generation wireless broadband access network in
Lithuania. This will make it possible for service providers to offer their
clients high data rates and easy to use Internet services. This new network will
facilitate the development of data transfer services, and such services could be
very useful to our company's clients," said Liudvikas Andriulis, director
of UAB "Eurocom," which is interested in the potential of a next
generation wireless broadband network. During the INFOBALT 2005 trade fair, Ian
Henderson, business development director from US-based IPWireless, the company
that offers the standards-based broadband wireless technology, will introduce
UMTS TDD to specialists and potential customers.