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Vol 3, No 4
29 January 2001
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Lithuanian news News from

All the important news
since 19 January 2001

Inga Pavlovaitė


Crisis in government after resignations

This week the coalition government of the New Alliance (Social Liberals) and the Liberal Union entered the gravest crisis of its first 100 days in office.

One reason was the controversial visit by Economics Minister Eugenijus Maldeikis (Liberal Union) to Moscow, where he disregarded diplomatic protocol and used the services of private companies. He was also exposed as having lied about one of his meetings with the director of joint Lithuanian-Russian company Stella Vitae, which wants to participate in the privatisation of Lietuvos Dujos (Lithuanian Gas).

Maldeikis claimed the meeting was accidental, whereas the businessmen from Stella Vitae say the opposite—the minister asked to meet them and the president of Russian gas giant Gazprom. As a result, both Seimas Chairman Artūras Paulauskas and President Valdas Adamkus have called for the resignation of Maldeikis, which is expected to follow soon.

The other scandal came with the resignation of Transport Minister Gintaras Striaukas. It appeared that under his supervision the company that won the most competitions for roadwork was the one in which his wife owned 20 per cent of shares. As a result, the Minister resigned before a damning report of the charges was released. Dailis Barakauskas has been appointed the new transport minister.


Peaceful revolution exported to Minsk?

40 Belarusians are learning how to wage a non-violent struggle against the dictatorial regime in a five-day seminar held in Vilnius called "Non-violent fight for democracy and the Belarusian democratic process." Participants represent practically all groups of the Belarusian opposition and include one of the most prominent leaders of the opposition Zyanon Paznyak, who came from the US.

After completing the course, each person is expected to become an instructor who can teach methods of non-violent resistance to other opposition figures. The seminar is organised by the Foundation for the Support of Citizens' Defence and by ex-MP Audrius Butkevičius (recently released from prison after serving a sentence for taking a bribe), as well as American Gene Sharpe from the Einstein Institute.

The Lithuanian Foreign Ministry has not commented on the activities of the seminar.


The Police have a boss—finally

After a long selection process, President Valdas Adamkus finally appointed 43-year-old Vytautas Grigaravičius to head the Police Department. He has worked in the police since 1978 and has swiftly moved upwards in his career until his retirement last year.

However, doubts were expressed as to his competence. Critics allege that when he left his post as head of the Alytus police department for Vilnius, he left behind huge problems for his subordinate officers. Also, some have doubted his moral stance, as it seems that he left the police last year to get a higher pension and has now returned under more favourable conditions.


Continuity and change in the central bank

Almost unanimously this week the Seimas confirmed Reinoldijus Šarkinas in his second term in office as head of the central bank. This is the first time since 1990 that the central bank boss not only saw out a full term but was also re-elected. The reason was probably best summarised by President Valdas Adamkus, who said that he wanted to see stability in the financial system and effective functioning of the Lithuanian central bank.

In the meantime, Reinoldijus Šarkinas announced what has been interpreted as the most likely date for re-pegging of litas from the dollar to the euro. He claims that January or February 2002 is the most convenient time for this, especially for annual business export and import contracts.

However, earlier he claimed that the beginning of 2002 is problematic due to certain psychological uncertainty over the euro appearance in cash form. Now he says that it is practically impossible to predict market reaction to the euro, so in any case a good chance for the re-pegging might be lost if it does not happen in the beginning of next year.

The proposal has to be approved by the government and parliament and the central bank insists that litas should be neither devalued nor re-valued in that process The present currency board model from 1994 pegs the litas with the US dollar at 4:1.


New cardinal in the country

On Sunday in The Vatican, the Pope proclaimed 37 new cardinals for the Catholic Church world-wide. Amongst them was the archbishop of Vilnius, 63-year-old Audrys Juozas Bačkis. The archbishop spent most of his time abroad, studying also in Rome, and returned to the country after the fall of Communism. The last Lithuanian cardinal, Vincentas Sladkevičius, died last year.


Sąjūdis threatened with court eviction

The once glorious independence movement, Sąjūdis, was threatened this week by Vilnius local authorities with court action and eviction. The authorities want Sąjūdis to pay its debts. In case of refusal, Sąjūdis could lose its location in a prestigious building in central Vilnius, just in front of the Cathedral.


And in other news...

  • Polish power network company Polskie Sieci Elekroenergetyczne (Polish Power Grids) announced that it would invest LTL (Lithuanian litas) 764 million (USD 191 million) in a project to connect the power grids of Poland and Lithuania. The construction of the power line is expected to start this year and be finished by 2008.
  • The government decided that for negotiations over the privatisation of the Lithuanian Shipping Company (LISCO), all the rights and duties are transferred from Dutch BB Bredo BV to Denmark's DFDS Tor Line.
  • After a break of about a month, Lietuvos Energija (Lithuanian Energy) has renewed electricity export to Belarus.
  • Although oil prices were rising internationally, they fell again in Lithuania mainly due to especially fierce competition.
  • One of the biggest Baltic Internet providers, Delfi Internet, has signed a contract with Lietuvos Telekomas (Lithuanian Telecom) to provide dial-up Internet service on LT's phone lines for a fixed monthly fee.

Inga Pavlovaitė, 26 January 2001


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