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Vol 2, No 36
23 October 2000
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News from LithuaniaNews from Lithuania
All the important news
since 14 October 2000

Inga Pavlovaitė
and Mel Huang


Post-election moods

In Lithuania last week, many post-election issues had to be dealt with, ranging from a mere clarification of standpoints to outright confrontation. As all new Seimas members convened in the first parliamentary session, the big question was: who actually won the elections? That was far from clear.

The so-called "New Policy" coalition, comprised of the Liberal Union, New Alliance (Social Liberals), Centre Union and the Modern Christian Democrats, is determined to form a government. With the explicit go-ahead from President Valdas Adamkus, they signed a formal coalition agreement this week that stated the principles for allocating cabinet posts (the largest vote-getter, the Liberal Union, got the most) and major policies. They also asked all other forces interested in co-operation to climb aboard. They have received signatures from representatives of the Peasants Party, the Polish Electoral Action and the "Young Lithuania" movement, among others.

However, the Social Democratic coalition, led by former President Algirdas Brazauskas, put up a challenge. The coalition proposed its own candidate, Česlovas Juršėnas, for the post of Parliament chairman. He refused a deputy chairman position pre-emptively offered earlier this week by the "New Policy" coalition.

Leader of the New Alliance (Social Liberals) Artūras Paulauskas was elected to the chairman's post late in the week with 76 supporting votes, while Juršėnas gained 53 votes. The election of Paulauskas was the first major test of the "New Policy" coalition's strength.

In the meantime, the last moves of the old ruling group were equally dramatic. First, it approved the abolition of the Ministry of Administrative Reform and Local Governments, which was merged into the Ministry of Interior Affairs. More controversial, however, was the proposal put forth by the government to grant the outgoing chairman, Vytautas Landsbergis, the social guarantees that apply to presidents. The rationale is that he actually served as a head of state in the reconstituted Seimas from 1990 to 1992. The fate of this ill-famed proposal is to be decided by the new Seimas.


Disturbing politics

The most disturbing turn in local politics stemming from the Seimas elections has been in Lithuania's second city, Kaunas. Controversial right-wing mayor Vytautas Šustauskas was elected to the Parliament and resigned from his mayoral post. An earlier agreement among political forces in Kaunas deemed that his deputy, who is from the New Alliance (Social Liberals), take over the post; however, this promise was not kept, and the coalitions in the city council went down the drain. The most likely scenario is the repetition of the pattern in the Seimas, with the "New Policy" group coalition taking a lead in Kaunas, but they are well short of seats to do so.


Privatisation problems

The Constitutional Court passed one of its most politically controversial rulings this week. The Court announced that in the privatisation of Lithuania's oil industry, state interests were infringed upon; namely, in the privatisation of Mažeikių Nafta. The Conservative-led government did not have the right to assume major financial responsibilities and, especially, to oblige itself to refund the losses of the strategic investor, US company Williams International. Five provisions of the contract were announced to contradict the Constitution and, therefore, were annulled.

The legal intervention is sure to complicate the situation. The question is whether the whole contract is legal, and the implications could be far-reaching. The initiative to question the constitutional validity of the contracts came from the old parliamentary opposition. It is likely that the new government will have to reconsider its responsibilities towards Williams International, and other legal problems will surely follow. The former, and likely new, Prime Minister, Rolandas Paksas, resigned last summer as head of government and, in a public statement, said he will not put his signature under the Mažeikių Nafta contract.


Selling state shares

On Thursday 19 October, the State Property Fund and the Dutch consortium B B Bredo signed a contract for the sale of 75 per cent of state shares in the Lithuanian Shipping Company (LISCO). According to the contract, the Dutch consortium will pay USD 47.6 million for 40 million shares in LISCO, invest USD 76 million by the year 2003 and preserve 75 per cent of jobs in the first five years. The sale of LISCO is not considered to be absolutely spotless, as President Valdas Adamkus ordered a large-scale investigation into the massive corruption charges reported in the national press.


Assessing anti-Semitism

Prime Minister Andrius Kubilius ordered a security services investigation into the recent and rather frequent anti-Semitic outbursts in the national press. Many headlines were explicit: "Will the Jews Again Rule Lithuania?", for example. The disturbing fact, according to officials, is that the regularity of the appearance of defamatory articles suggests this is the beginning of a well-thought-out and well-prepared anti-Jewish campaign. The State Security Department spokesperson said that this could qualify as a violation of the law and that they are looking into the incidents.

In a related story, the Vilnius district court has ruled to consider the case of alleged Nazi war criminal Kazys Gimzauskas in absentia, due to medical authorities testifying that Gimzauskas cannot understand the essence of his actions and control them due to illness.


And in other news...

  • Power utility Lietuvos Energija has signed a contract with Germany's Giro Energy to export Lithuanian energy to Belarus. The contract is valid until the end of the year and does not specify the exact amounts of exports.
  • The contract for labelling tobacco and alcohol products was halted by the State Taxation Department. It turned out that the head of the tender winner had close contacts with the Vilnius Brigade, allegedly the most influential organised crime gang in Vilnius.
  • The government officially adopted two more positions on the chapters for Fisheries and Customs Union in negotiations for EU membership.
  • The Seimas proclaimed 2001 the year of European languages in Lithuania.
  • The international Baltic states military exercise, Amber Sea 2000, took place in Klaipėda this week.
  • A Swedish consulate was opened in Klaipėda.


Exchange Rates
As of 20 October 2000
Currency Lithuanian litas (LTL)
1 US dollar 4.00
1 British pound 5.78
1 German mark 1.71
1 euro 3.35


Inga Pavlovaitė and Mel Huang, 20 October 2000

Moving on:


Lietuvos Rytas
Lietuvos Aidas
Baltic News Service (BNS)
Kauno Diena


Beth Kampschror
Leaving Gracefully

Howard Jarvis
Business in Belarus

Brian J Požun
Slovenia Turns Left

Daria Kulagina
Facing the Past

Andrew Cave
Finding the Centre

Cyril Simsa
The Modern
Human Wind

Catherine Lovatt
Blue Guide Romania

Dick Nilsson
Central Europe:
Core or Periphery?

Milošević Remains?


Martin D Brown
Czech Historical Amnesia

Dejan Anastasijević (ed)
Out of Time

Gusztáv Kosztolányi
Hungarian Oil Scandal

Sam Vaknin
After the Rain

Press Reviews:
Andrea Mrozek
Exchanging Extremes

Oliver Craske
"Normal" Countries


Mixed Nuts

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