Lituanica

Lithuania was the sole of 27 EU member states, represented in the European Union’s (EU) General Affairs and External Relations Council’s (GAERC) session in Luxembourg last week to dissent to the proposal to begin talks with Russia over the new partnership agreement.

The countries decided that EU-presidency holder Slovenia’s Foreign Minister Dimitri Rupel arrived to Vilnius to further harmonize stances on the issue.  Amongst those who arrived to Vilnius were the Swedish and Polish Ministers of Foreign affairs.  However, another issue for the Lithuanians was of another importance, expression of support to Georgia.  The plan was that all ministers should visit Tbilisi on Monday and show their support to Georgia.

However, the Lithuanian diplomats had have heard a warning from Slovenian Foreign Minister Dimitri Rupel that he would accompany his Lithuanian, Polish and Swedish colleagues to Georgia only if Lithuania abandoned its proposals to the mandate of strategic talks between the European Union and Russia.  An anonymous Lithuanian diplomat expressed his disappointment by saying “How can one propose such exchange? It is incomprehensible whether the proposal from the European Union’s presiding country Slovenia indicates the entire EU’s stance on Georgia or is it a lame Slovenian proposal aimed at forcing Lithuania to give up its legitimate requirements in the discussion of the negotiating position of the EU-Russian strategic partnership agreement”.

However, after discussion in the Stikliai hotel the Lithuanians claimed that the EU had agreed with all Lithuanian propositions with some amendments.  The Lithuanian FM stated that the EU solidarity exists not only in declarations but also in reality.  Still he remained that the positions will have to be agreed with the other 23 Member States.  The Slovenian MF noted in the press conference that: ‘All Europeans States and the EU Members understand Lithuanian position.  And I can easy tell that I understand the Lithuanian concerns’.  So, what are those demands?

As Lietuvos Rytas daily wrote last week, Lithuania decided not to approve the mandate for the EU-Russia negotiations until this mandate reflects Lithuania’s interests. This was the first time Lithuania has dared to fight for its interests in the EU with such fervour.

Vilnius demands to add to the energy declaration Russia’s commitment to observe the requirements provided for in the Energy Charter Agreement.

Moreover, Lithuania wanted the EU negotiations mandate to include the point that Russia should cooperate more actively in the field of renewing delivery of crude oil via the Friendship (Druzhba) Pipeline. This pipeline was closed in 2006 for “political repairs.”

As the Lithuanian Minister of Foreign affairs noted “Druzhba was cut off without an explanation. (…) We are worried that Russia is creating a precedent. Energy security and creating a precedent are issues of interest to the EU. This is not a bipartite issue. And we believe that the question of a precedent, and of how far one can go in not cooperating with one EU state is important to the entire EU as well. We have an alternative for Druzhba, but not one for gas”.

Lithuania also noted that Russia’s attitude toward its neighbours is related to the security of Lithuania and the entire EU. This is why Lithuania proposes a declaration on Georgia and Moldova.

Moreover, Lithuania would like to have a declaration on legal cooperation, which should promote constructive cooperation in the investigations of the 13 January 1991 events in Vilnius and the 31 July 1991 massacre in Medininkai, as well as of the disappearance of EU citizens in Russia.  There is also an ongoing case of disappearance of Lithuanian businessmen Mr Jucys in Kaliningrad a year ago.

Lithuanian is also seeking to add an additional declaration to the negotiations mandate to compensate for the damages incurred by the persons deported from the occupied Baltic countries. Ensuring such support to the deported persons was one of the international commitments Russia undertook when it joined the Council of Europe.

Lithuania does not impose demands on Russia. It urges the EU to protect Lithuania’s interests, the same way it protects the interests of other EU members.  Lithuania is not trying to change Russia, it is impossible, it simply tries to change the EU attitude towards Russia, in sake of the EU.

The another point is that Lithuania is a Member State, the same as Germany, France, Italy, Cyprus, Greece, Poland or Ireland who are also defending their interests by blocking decision making.  However, Lithuania is standing not only for the ‘meet’ as the Poles did, but for the values of justice.

Lets see how it will go.

The Lithuanian President Valdas Adamkus gave an interview to the Swedish National Radio SR.

I would like to present you with an article writen by Mr Vadimas Titarenko on the status of the Baltic economies.  Mr Titarenko works for the NROD/DnB bank.Most of Lithuania’s statistical indicators for 2007 seem in pretty good shape. Annual GDP growth accounted for 9 percent in the first three quarters of 2007, leaving year-end growth at a forecast 8.3 percent. Average earnings rose by almost 20 percent in the same period. Unemployment is very low at 4 percent and the fiscal indicators are looking good. Which leaves inflation…

International financial experts all too often see the three Baltic countries as a unified region. A lot of criticism has been directed at Latvia – justifiably, since the macro indicators there are quite poor – but unfortunately what happens in Latvia also reflects badly on Lithuania where the indicators are in fact quite healthy. What the experts tend to criticize is that the bulk of the growth so far seen in the Baltic countries is based on household consumption.

Household expenditure is indeed growing very fast – the gap between consumption growth and GDP growth is getting wider. There is an even bigger disproportion between the pace of expansion in the domestic trade sector and the income growth of the population, which means that today households are living on future consumption.

It looks as though consumers here want to rapidly catch up on those in Western Europe – at the cost of living on loans.The dynamics on loan portfolio growth do indeed show that consumers are still taking loans. In the last nine months, Lithuania has been the leader in the Baltic states in terms of consumer loan growth.

The fast growth in consumption has inevitably had an impact on the economy. Over the last couple of months alone inflation has accelerated very much. In 2005, annual CPI growth was 2.7 percent. By June 2007, it had risen to 4.8 percent. In November 2007, it was 7.8 percent – inflation’s highest level since 1997.

The worrisome part is that inflationary expectations are created. To diminish them is a difficult process, especially since a great deal of the inflationary pressures are caused by external factors.On a global scale, poor crop yields and increasing biofuel production have led to 15.4 percent annual growth in the price of food products in Lithuania.

There are also increases in energy prices to contend with. Energy prices in Lithuania are still lower than they are in Germany and other Western European countries, but that is about to change.Gazprom is raising natural gas prices from January 1, 2008, and the Lithuanian authorities have already announced that prices for households are going to increase by 70 percent. 

Read rest of the article on www.alfa.lt 

It appears that the Time mag has lost a plot once again.  Stalin was chosen twice.. Hitler was chosen in 1938, a year before that bloodiest war erupted.  I am sure that the magazine had the same line by appointing the despot as appointing Mr Putin: ‘TIME’s Person of the Year is not and never has been an honor. It is not an endorsement. It is not a popularity contest. At its best, it is a clear-eyed recognition of the world as it is and of the most powerful individuals and forces shaping that world—for better or for worse. ’

However, who would disagree that the Time nomination did not add to Hitler’s popularity in media controlled Nazi Germany, and evening the wider world ‘if  the Yankees think that our Leader is great, why should I doubt his greatness?’ probably many Germans thought back in 1938.

I am not comparing Putin to Hitler, but a free world magazine should have more respect for democracy, and should not play a cheep ‘let’s be controversial this year’ game.  The Putin controlled media will take a full advantage of that.  The Time magazine should be clear, they will not mention that the nomination is ‘not a popularity contest’.

Putin has destroyed a democracy and finally buried hope of Russia ever becoming a normal country, when the neighbouring countries sees it not as a threat but as a partner.  He created a system which is much more dangerous to Russia then that of Yeltsin one.  We are all humans, even Mr Putin, hence, what would happen if let’s assume by an incident or accident the leader is gone…  What would happen to Russia then?

It is not Putin who should be nominated to a Person of the year.  He was just a product of the lucky circumstances.  If the Time Magazine run out of options they should not have chosen not a human but a real Tsar of the world – Mr. OIL, as one of the Lithuanian bloggers suggested.  Mr. OIL runs the world at the moment.Have a look what the Time main raival, the Economist thinks about the choise.

The Lithuanian President Valdas Adamkus vioced it openly what was known form a very beginning.  The Russians terminated oil flow to Mažeikių Nafta via Druzhba (Friendship) pipeline, after the Lithuanians sold it to the Poles in Summer of 2006.  He admitted that this is not a technical problem this is a political problem.

“I have no doubt about this. Let’s be honest, there is no need any more to cover up with nice diplomatic phrases,” the President said to Mark Mardell, the BBC corresponet.

“At the very beginning it was definitely a very reasonable technical issue. We offered assistance from our specialists to repair it. No response. Formal letters came from the presidents, even came from the EU president Barroso, no response, total ignorance.

“Finally they have admitted that they don’t intend to deliver any more to Lithuania. I don’t believe that this is really fair dealing with their neighbours.”

Read more about the issue on the BBC’s Mark Mardell’s blog.

It appears that the highest Lithuanian officials are joining a debate, which is gaining momentum, on trying to save the Ignalina Nuclear Power Plant (INPP) from closure at the end of 2009. It started during the energy Conference in Vilnius last week.  Lithuania’s Economy Minister Vytas Navickas declared that the European Union might allow Lithuania to continue operating the plant through 2009, until a new nuclear plant is build.

Mr. Navickas appealed to the fact that once the plant is shut down, the prices of electrical energy will go up by 40 percent and 75 percent of Lithuania’s energy sector will depend on natural gas from Russia. Lithuania has undertaken to decommission the INNP in 2009 and, together with the Baltic countries and Poland, is planning to build a new nuclear power plant, which will be put into production around the year 2015. However, a day later the European commissioner for energy Andris Piebalgs has urged Lithuania not to even think about continuing the operation of the INPP.As the Commissioner announced in Kauno Diena “I cannot understand the arguments of the economy minister. The plant must be shut down as scheduled, as this is provided for in Lithuania’s accession agreement. Besides, there is a mechanism to compensate the decommissioning in place. The grant will be lost unless the obligations are met. And finally, the decommissioning date is no surprise for Lithuania.  Do not waste time on empty discussions.”

Howerver, on the 16 October the joined President Valdas Adamkus the Minister of Economy and expressed his believe that Lithuania may convince the European Union (EU) of the necessity to extend the lifespan of Ignalina Nuclear Power Plant (INPP). He is confident, however, that the country will avoid energy famine under any scenario.

As the President told on the interview to the Zinių Radijas “First of all, we shall evaluate the current circumstances, future prospects, and then go, talk and negotiate using the language of arguments; I think this is reasoned and necessary. I think it is possible to convince them. Since there are lots of reasonable people and they see the actual situation as it is, since we are a EU Member State, and it is important for the EU not to ruin the whole economic life of one of its members. I think we will not be able to build a new nuclear facility by 2009; it might be expected that we will build by 2012 if we are not put back by vain discussions now. Reasonable people may always agree on a period of two or three years, I believe”.

The President continued, “The most important is that we have a new power plant to be built, and it would be unreasonable, irrational to cut any further supply, sources we are working on at present, somewhere in the middle of the road. I think that any reasonable establishment or a person will understand, this may be reasoned, and we may consider the period of extension so as to have us shift from one system to the other”.  

As the BNS noticed the President saw no major threat of energy famine during the transitional period even if Lithuania failed to agree on the postponement of INPP closure date, and enumerated various options. “I will be visiting Sweden in mid-November, I have already spoken about a possibility to have a link to Sweden via the Baltic Sea, through Estonia, and get electricity from Sweden. Again, Ukraine’s President Viktor Yushchenko, who is well aware of the circumstances, told me during the just-ended Vilnius Energy Conference that Ukraine was ready to sell electricity to Lithuania, if required”.

Speaking about the planned new nuclear power station, the president encouraged to switch from talks to concrete work. “We must build it without questions about success. We should arrange without delay who will build it and how will we divide the financial responsibilities among us. Then we should sit around a table with main participants of the projects, namely Latvians and Estonians. I see no problems with them. When it comes to Poland, the Poles said clearly during the Vilnius conference that the power plant was vital to them, as well,” said Adamkus.  

In his words, Poland’s demands to receive more electricity than planned are natural. “I had a thorough discussion with Polish president and other officials of Poland - the demand for electricity is necessary for them amid developing economic life and industry, they have no other way out. If we had such a problem, we would also seek to get as much electricity as we need,” the president noted.

As the BNS informed today a Member of the European Parliament Danute Budreikaite said today that Lithuania still has not exhausted every possibility in the negotiations over extending the operation of the INNP and suggests that the government should make more efforts seeking to postpone the date of shutting down the plant.

The MEP also says that back in September 2006, when the European Council was asked if, should a new situation emerge, Lithuania may “readdress the terms of shutting down the 2nd bloc of the Ignalina nuclear power plant anew,” the answer was that according to the provisions of said Article 37, the concerned Member State, to utilize the opportunity to apply the general safeguard provision, must first of all approach the Commission asking for a permission to take preservation measures based on the information that has been collected and forwarded to it.

“After that, the Commission issues a permission for the preservation measures that, in its own discretion, it considers necessary. So the Commission must asses whether the measures that the author of the question has envisaged can be taken,” the member of the EP says.

As the BNS reported five-country cooperation agreements on implementation of the project of the pipeline Odessa-Brody-Plock-Gdansk were signed in Vilnius on evening October 10.

The agreement on energetic cooperation and one more energy document were signed by representatives of ministries and companies of Lithuania, Poland, Ukraine, Azerbaijan and Georgia.

“The signing of this agreement is just the beginning of a long road. I hope that we will continue working together to prevent insignificant technical disagreements from causing a slow-down of the project. The oil pipeline unites and will continue to unite our regions, creates added value and strengthens energy security in the whole of the region,” Lithuania’s President Valdas Adamkus said on Octover 10.

As the BNS remained the signing is expected to be the last step for launching the alternative project to Russia’s oil supply. Odessa-Brody-Plock-Gdansk is planned to be the first pipeline to link the Caspian Sea and the Black Sea regions with countries of the Baltic Sea region and become the new way of oil transit to Europe.

The largest Lithuanian daily Lietuvos Rytas published an article today.  Even though some developments took place since the article was published but the feeling in Lithuanian in the morning was such.  The BNS agency translated it, have a look.

“The sonorous speeches about strategic partnership between Poland and Lithuania, the joint energy and political front against Russia in shatters.”“The honeymoon between Warsaw and Vilnius is over, crisis in bilateral relations continues deepening.” “Poles slap Lithuanians on the face.”These are the headlines published by Lithuania’s largest daily newspaper Lietuvos Rytas on Thursday to describe the negotiations on the energy bridge from Lithuania via Poland to Western Europe, which ended without a result on Wednesday.During the talks that lasted into early hours of Tuesday and all day Wednesday, Lithuanian politicians and diplomats made every effort to ensure signing of the vital document during the Vilnius conference of energy security. The document was expected to become one of the main results of the forum.

The international event is intended to search for ways of liberating from energy dependence on Russian resources.However, all attempts to persuade the Poles were unsuccessful. The official version was the failure to prepare all necessary documentations. Both parties exchanged promises to prepare the documents and sign the agreement by the end of the month. Yet there are growing doubts that the agreement would be signed, said the Lietuvos Rytas.The political move of Poland’s top officials seconded the threats made by the country’s Economy Minister Piotr Wozniak who last week started to unexpectedly blackmail Lithuania.During his stay in Vilnius last week, Wozniak said directly that Lithuania was ought to provide Poland with the bulk of electricity generated by the future power plant to prevent stalling of the energy bridge project.

After the statement, some political reviewers guessed whether this could be the minister’s personal stance, which reflected the political turmoil in Poland, or the Warsaw attempt to check Lithuania’s reaction in order to see the yielding Lithuania was willing to make.Nevertheless, Wozniak’s statements were verbatim restated by Polish President Lech Kaczynski on Wednesday, said the Lietuvos Rytas.Lithuanian President Valdas Adamkus made a last-ditch attempt to dispel the black clouds: “We did not sign the agreement on the (energy) bridge for the sole reason that the documents had not been prepared in time, but this project has to be carried out. I think we will sign the document by the end of this month.”Lithuanian diplomats made no secret of their disappointment and frustration. Some of them described the Polish move as a huge mistake.

Even before the official statement about delay in the signing, Lithuania’s former foreign minister, MP Antanas Valionis, forecasted this would cause a crisis in Lithuanian-Polish relations.“What can we do. We waited for this for 16 years, we can wait a few more days. I still believe we had not been deceived and the Poles will not follow the former German leader Gerhard Schroeder who later received a position with the Russian concern Gazprom,” said Valionis.“We will see soon whether the routine promise would become reality,” the daily cited a top-ranking Lithuanian diplomat as saying. In his opinion, Lithuania will issue a strong-worded response to the Polish blackmailing about influence in the future power plant. “We have to reinforce our work in the direction of an energy bridge with Sweden. This should make our neighbours get real. In the purely economic sense, they need the energy bridge just as much as we do,” said the diplomat.Asked to name the true causes of Polandn’s procrastination, he referred to a few: “First of all, this is an eternal problem with Poland, which came to light during the negotiations over Mazeikiu Nafta (Mazeikiai Oil). The Economy Ministry is thinking in a narrow and simple manner - percent, megawatts, maximum profit. Figures of the large country view Lithuania and the other Baltic states superiorly and are, therefore, unable to see the strategic and geopolitical level. However, our hope is always their President’s Office and we are trying to work hard with it.”

In the diplomat’s words, another reason behind the procrastination is the Oct. 21 parliamentary elections in Poland. The Polish president also referred to the factor in the Wednesday’s talks. A political force headed by the Polish president and his twin brother Jaroslaw Kaczynski stands a chance of staying in power, however, they may have to share it with the Liberals who are currently in opposition.“The president is unwilling to give his opponents an opportunity to accuse him of failure to defend Poland’s interests. And the so-called Polish interests have always been one of his main political slogans,” the diplomat told the Lietuvos Rytas.Source BNS

As the President’s press office announced the Vilnius Energy Security Conference 2007: Responsible Energy for Responsible Partners held on 10-11 October 2007 is broadcasted live by Internet via Windows Media and RealMedia. 

Lithuanian side is showing flexibility towards Poland regarding the Power Grid between the two countries.  On the other hand Poland came with other suggestions and proposed to include in the project Latvia and Estonia. 

As the BNS reported the Lithuanian Economy Minister Navickas is hopeful and expects that Lithuania and Poland will sign in Vilnius on Wednesday an agreement to establish a joint venture to build an “energy bridge” between the two countries.  “Yes, the heads of (Poland’s) PSE and Lietuvos Energija (Lithuanian Energy) should sign the agreement, which will be useful to Poland as well”.

He said to the BNS that “It (Poland) will be able to purchase as much electricity as it wants from several sources: to have its own share of electricity from the planned nuclear power plant at cost price and buy an additional amount from other producers at market prices”.

Under the draft agreement, the joint company would be registered in Lithuania and the Poles would have the right to nominate its chief executive officer.

Today Navickas met with the EU coordinator for the energy link project Wladyslaw Mielczarski, who came to Vilnius to attend this week’s international energy security forum.

“He (Mielczarski) suggested that if Latvia and Estonia joined the project, three or four lines could be required, rather than a single one, in order to connect the grids of all three Baltic countries to the Western European UCTE system,” the minister said.

“Our opinion is that the project should be carried out in two stages. The energy link between Lithuania and Poland needs to be built first,” Navickas added.

Navickas also said that the energy link could be used not only to export energy produced by the new nuclear plant but for other purposes as well. “Cheap night-time electricity from Poland could be stored at the Kruonis Hydro Pump Storage Plant and be transported back to Poland in daytime. There are many possible ways of using the energy bridge,” he said.