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Baltic Report: March 11, 2003

11 March 2003, Volume 4, Number 9

This issue covers events in the Baltic states from 22 to 28 February 2003.
Armed forces commanders Major General Jonas Kronkaitis (Lithuania), Admiral Gaidis Andrejs Zeibots (Latvia), and Vice Admiral Tarmo Kouts (Estonia) held their annual two-day meeting in Vilnius on 27-28 February, BNS reported. The commanders signed documents calling for closer cooperation in NATO integration efforts. They addressed the proposal from NATO's northeastern unit to establish along with Germany, Denmark, and Poland a Baltic cooperation group. They also discussed the annual plans of the trilateral BALTBAT joint battalion, BALTNET joint air surveillance, and the BALTRON joint navy squadron.
* A meeting of Estonian, Latvian, and Polish tax-fraud police and prosecutors discussed in Riga on 24 February the signing of an agreement to enhance cooperation in the investigation of financial crimes, LETA reported. They discussed matters linked with their future membership in the European Union, upcoming changes in the taxation system in all three countries, and other common problems.

In a speech commemorating the 85th anniversary of Estonian independence on 24 February, Arnold Ruutel said the great progress that Estonia has made in recent years has come at a regrettably high social price, BNS reported the next day. He noted that a low birthrate, incomplete education, a dangerously high crime rate, and stratification of society are serious warning signs. Ruutel affirmed that if Estonia wants to secure its independent statehood and restore societal confidence, it must "set common goals [that are] comprehensible to everyone and agree upon an action plan to achieve them." Although the aging of, and decline in, the population are cited as major problems for Estonia, little attention is paid to the lives that are lost through violence, injury, or growing alcoholism, he said.

Parliament on 25 February amended Article 156 of the Estonian Constitution to extend the terms of local government councils from three to four years, BNS reported. The measure, touted as a way both to save money on elections and to allow politicians more time to fulfill their promises to voters, was approved by 91 of 101 lawmakers. The move marks the first amendment to the constitution since its adoption in the summer of 1992. The next local-council elections are scheduled for the fall of 2005.

The Russian Party in Estonia organized a rally in front of the U.S. Embassy in Tallinn on 27 February protesting a possible military attack against Iraq, BNS reported. About 50 people participated in the demonstration with placards with slogans such as "Hey, cowboy! Who'll be the next after Iraq?" and "Iraq -- a new Vietnam." Party Deputy Chairman Nikolai Maspanov handed an antiwar petition to embassy officials. A counterdemonstrator calling himself an "ordinary Estonian" and expressing support for the United States carried a placard with the text "USA + Estonia. One Estonian is for you!"

A new law on immigration and deportation that went into effect on 1 March simplifies and accelerates the expulsion procedure for individuals staying illegally in Estonia, BNS reported on 26 February. The new law allows police or border guards to expel an illegal alien within two days of detention without an administrative-court decision. The previous law required that an expulsion order be issued by an administrative court following a request by officials of the Citizenship and Migration Board. Foreigners most often become illegal when they overstay their visas or exceed the term of visa-free stay, according to BNS. A person expelled from Estonia is automatically banned from entering the country for 10 years. Roughly 700 people have been given 10-year bans since independence was restored in 1991.

By a vote of 69 to 16 with one abstention, legislators on 25 February overwhelmingly approved the appointment of Mihkel Oviir, an adviser to the country's legal chancellor, as chief of the State Audit Office, BNS reported. Oviir replaces Juhan Parts, who resigned last August (see "RFE/RL Newsline," 12 August 2002) and was later elected chairman of the center-right Res Publica party. The 61-year-old Oviir joined the staff of the Justice Ministry in 1972 and served as its chancellor from 1992-2002. The state auditor is appointed for a five-year term.

The Central Election Committee announced on 27 February that early voting for the parliamentary elections slated for 2 March has been greater than in past elections, BNS reported. On 24-26 February, 14.5 percent of eligible voters -- or more than 124,000 citizens -- cast their ballots. Early-voting figures in the parliamentary election of 1999 and in local government councils last fall were 7.7 and 10.5 percent, respectively.
* A delegation from the Russian State Duma led by Deputy Chairman Lyubov Sliska visited Estonia on 26-28 February, BNS reported. The delegation was invited by the Baltic department of the Russian Culture Foundation, whose board member Yevgenii Tomberg is also the chairman of the Estonian United Russian People's Party. The delegation visited Tallinn and Maardu, a predominantly Russian-populated industrial town east of Tallinn.
* In a speech given in Tartu on 23 February, Prime Minister Siim Kallas lashed out at diffident and toadying attitudes toward Russia, BNS reported. He mentioned that there are many who boldly criticize the United States, yet few who dare to write critical articles about Russia, though they understand much more about the situation in Russia than in Iraq. He articulated the reason for the lack of criticism of Russian policy toward Chechnya, saying, "Isn't it because of a subconscious or conscious fear: What if they come back?"
* The government on 25 February endorsed the text of a letter to be sent to NATO by Foreign Minister Kristiina Ojuland in which Estonia declares its readiness to sign the accession treaty and fulfill assumed obligations, BNS reported. The letter will be accompanied by a timetable of reforms that Estonia plans to carry out before joining NATO. NATO member states are expected to sign the accession agreements with the seven candidate countries on 26 March.
* The board of the Reform Party approved on 26 February the starting position for coalition talks after the parliament elections on 2 March, BNS reported. It set out the party's stance on eight issues, which it was hoped would be included in any coalition agreement. They included a categorical opposition to a graduated income tax, a reduction of the rate for personal income tax from the 26 percent to 20 percent, raising the one-time state birth allowance to 5,000 kroons, firm support for Estonia's entry into the European Union and NATO, backing amendments to allow the direct election of the president in 2006, and upholding the principles of Estonia's present citizenship and language policy.
* The Center Party lost its majority in the Tallinn City Council on 27 February when two-time Olympic cycling champion Erika Salumae decided to leave the party, BNS reported. Her departure decreased the number of party deputies from 32 to 31 in the 63-member council. She was elected a parliamentary deputy in 1999 but decided not to seek re-election in the new elections on 2 March after the party ruled that she should run in the electoral district covering the southern Voru, Valga, and Polva counties and not in Tallinn, as she wished.
* Center Party Chairman Edgar Savisaar filed a suit against the business daily "Aripaev" in the Tallinn City Court on 27 February demanding a public apology and damages of 1 million kroons ($66,700), BNS reported. He charged that the paper had falsely claimed that businessman Leonid Apananski had paid this year's insurance coverage for his farm in Hundisilma as he had presented bank documents proving that he had paid for the insurance. Savisaar also rejected what he called the paper's claims that he had acquired criminal money.
* The Res Publica party borrowed 3 million kroons ($200,000) on 25 February from Sampo Bank to finance its campaign for the 2 March parliamentary elections, BNS reported. The loan is for three years with an annual interest rate of 9 percent.
* With the assistance of the state conciliator, Estonian Railways signed an agreement on 27 February with the trade union in accordance with which the number of people who will lose their jobs was reduced from 480 to 380, BNS reported. According to the agreement, Estonian Railways will pay those being laid off severance equal to three months' pay in addition to payments stipulated by the law.
* According to preliminary customs statistics in 2002, Estonia imported goods worth 110 billion kroons ($6.9 billion) and exported goods worth 82 billion kroons, resulting in a trade deficit of 28 billion kroons, BNS reported. Finland was Estonia's main trading partner, accounting for 21.3 percent of exports and 23.1 percent of imports. Other leading export countries were Sweden (11.5 percent), Russia (8.9 percent), Germany (7.7 percent), Latvia (7 percent), Norway (4.3 percent), and Lithuania (4.3 percent), while the other main import countries were Germany (10.6 percent), Russia (10.3 percent), Sweden (8.7 percent), the Netherlands (4.9 percent), Latvia (4 percent), and Lithuania (3.5 percent).

Accompanied by a large delegation of businessmen and officials, including Deputy Prime Minister Ainars Slesers, Defense Minister Girts Valdis Kristovskis, and Foreign Ministry State Secretary Maris Riekstins, President Vaira Vike-Freiberga began a two-day visit to Poland in Warsaw on 26 February with a discussion with her Polish counterpart Aleksander Kwasniewski on the Iraq situation and bilateral relations, LETA reported. After the meeting, Kwasniewski said that Poland and Latvia believe Iraq must be demilitarized within an international framework. The two sides signed an accord on mutual protection of confidential information. Kwasniewski announced that the two countries will soon sign cooperation agreements covering science, customs, readmission, and combating crime, PAP reported. Later that day, Vike-Freiberga opened a Polish-Latvian economic forum in Warsaw. She also had meetings with the chairmen of the Sejm and Senate, Marek Borowski and Longin Hieronim Pastusiak, respectively. After talks about their countries' move to integrate into the EU with Polish Prime Minister Leszek Miller, Vike-Freiberga traveled to the port of Gdynia, where she placed flowers on the grave of World War II Latvian resistance-movement leader Konstantins Cakste and at the monument to port workers killed during the uprising in December 1970. She also visited Gdansk, where she opened an exhibition of works by popular Latvian women painters at the Gdansk Town Hall and visited the Amber Exhibition.

Parliament on 28 February approved the 2003 national budget on a party-line vote of 55 to 44, LETA reported. The budget forecasts revenues of 1.67 billion lats ($2.9 billion), expenditures of 1.85 billion lats, and a resulting deficit of 177.5 million lats, which is about 3 percent of gross domestic product. Although numerous amendments to the budget were proposed, the parliament only passed those that had been approved earlier by the Budget and Finance Commission. Prime Minister Einars Repse said after the vote that preparing amendments to the budget will be among the government's key tasks.

Central bank head Ilmars Rimsevics argued in a commentary in the daily "Diena" of 26 February that the proposed deficit of 177.5 million lats in the 2003 budget is unacceptably large, LETA reported. If that figure is not reduced, he said, the national debt will increase, resulting in higher interest rates, a deteriorating investment climate, and slower economic development. Rimsevics suggested that the budget deficit be slashed by at least 60 million lats ($103 million). He also noted that since the national currency, the lats, is pegged to the SDR (special drawing right), the growing budget deficit cannot be offset by a depreciation of the lats. Rimsevics also cited three other reasons for reducing the budget deficit: spending to service the debt diverts resources from government services, the need for curtailing the current-account deficit, and greater room for fiscal maneuver for the government amid sluggish global growth.

In an interview on Latvian State Radio on 27 February, Einars Repse said he hopes to keep this year's budget deficit below 2 percent of gross domestic product, LETA reported. He noted that concerns expressed by the Bank of Latvia over a large budget deficit are not unfounded. Repse conceded that the tax-collection mechanism is still bogged down but should improve. He also signaled room for budget cuts, saying that expenditures have not been optimized. He added that additional funds can be found for such government priorities as health care and education.

Responding to a Latvian Foreign Ministry note (see "RFE/RL Newsline," 21 February 2002), the Russian Embassy in Latvia explained on 22 February that the contentious Latvian-Russian agreement of June 1993 provides only for setting up a joint venture for an oil pipeline but does not regulate issues relating to its practical operations, BNS reported. The embassy said Latvian accusations that Russia is not fulfilling the obligations of the agreement by reducing oil supplies to Ventspils are groundless. Claiming that it has "no technical capacity" for exporting through Ventspils, the Russian state-owned oil exporter Transneft decided not to send oil there in the first quarter of the year and will determine plans for oil exports in the second quarter only in late March. Some analysts believe the halt in shipments is an effort to reduce the price of the soon-to-be-privatized Ventspils Nafta oil terminal and to scare off any potential Western strategic investors.

The cabinet on 25 February approved the new makeup of a 24-member commission to facilitate the conclusion of bilateral agreements between Latvia and neighboring Russia, LETA and BNS reported. The group will be headed by Deputy Prime Minister Ainars Slesers. The previous commission of 22 members, formed in December 1997, was hampered by frequent changes in the Russian delegation's membership. Slesers said that launching political and economic dialogue with Russia will be his main task. He expressed the hope that Latvia's expected EU and NATO membership will promote Russia's understanding that the situation between the countries has changed.

Farmers' plans to deny trucks passage at the Salociai-Grenctale and Kalviai-Meitene border checkpoints with Lithuania on 25 February were called off after last-minute talks with the government on 24 February, LETA reported. The action was organized to protest the situation in the dairy, meat, and sugar-production sectors. Prime Minister Repse, together with Agriculture Minister Martins Roze, Economy Minister Juris Lujans, and Finance Minister Valdis Dombrovskis, held talks with representatives from the Agricultural Organizations Cooperation Council. The government agreed to allot about 4.3 million lats ($6.8 million) from this year's subsidies fund to the sectors in question. The threatened roadblocks had sparked serious concern within the Latvian international trucking association, Latvijas Auto, and the Lithuanian National Road-Carriers Association, LINAVA.

At the request of embattled Health Minister Aris Auders, the Office for the Prevention and Abatement of Corruption (KNAB) opened on 25 February its first-ever criminal case over alleged violations of procurement rules at the Traumatology and Orthopedic Hospital, BNS reported. Auders, who remains on the hospital's staff during his tenure as minister and who has himself been accused of corruption in accepting under-the-table payments for medical services, was asked by the KNAB to conduct further investigations into hospital practices -- a circumstance termed "a bit strange" by hospital director Valdis Zatlers. Zatlers, whom Auders has accused of spreading the illicit payments charges, was placed on administrative leave by Auders on 27 February, while the KNAB charges are being investigated, according to BNS.
* NATO Secretary-General Lord George Robertson made a working visit to Latvia on 28 February, LETA reported. He had meetings with President Vike-Freiberga, Prime Minister Repse, Foreign Minister Sandra Kalniete, Defense Minister Girts Valdis Kristovskis, and parliamentary chairwoman Ingrida Udre. The visit is part of Robertson's tour of all countries invited to join NATO.
* More than 50 people staged a demonstration in front of the Russian Embassy in Riga on 23 February to protest the war in Chechnya, LETA reported. The action was organized by the Latvian National Front and the youth organization Klubs 415. The protesters held signs with slogans such as "Freedom For Chechnya!" and "Stop Genocide Against Chechens!" The date was chosen for the protest because it was the 59th anniversary of the forced exile of 1 million Chechens from their homeland by the Soviet Union.
* Russian Ambassador to Latvia Igor Studennikov told reporters in Riga on 27 February that he was glad that the current Latvian parliament had not followed the example of its predecessor, which had established a Latvian-Chechen support group with at least 10 deputies from the ruling coalition and opposition, BNS reported. He noted that Russia appreciated the condemnation of the Chechen hostage taking in Moscow last October and the offer to provide a chance for some of its victims to stay at a rehabilitation facility in Latvia.
* At the invitation of French Minister for Agriculture, Food, Fisheries, and Rural Affairs Herve Gaymard, Agriculture Minister Martins Roze traveled to Paris on 26 February to discuss the latest developments in the sector due to EU integration, LETA reported. The ministers' talks focused on planned reforms in EU agriculture policy, which will also affect the EU candidate countries. Roze also participated in events devoted to the EU enlargement process and visited an international agricultural fair.
* The president of the nongovernmental organization European Movement in Latvia, Ainars Dimants, announced on 25 February that it will launch an information campaign about the European Union to boost public support before the referendum in September, BNS reported. He said that the organization has started accepting donations that will be used to finance a conference, an updated version of the book "What a Latvian Businessman Should Know about the EU," seminars, and promotional events all over Latvia.
* The government decided to dismiss Kalvis Bricis from the post of director-general of the State Real Estate Agency on 25 February after a Finance Ministry task force determined violations in implementation of a project on construction of a new administrative building for the Interior Ministry, LETA reported. It appointed Sandra Bukane, an adviser to Finance Minister Valdis Dombrovskis, as acting head of the agency until a new director-general is appointed.
* A congress of the Social Democrat Union (SDS) held in Jelgava on 22 February re-elected Peteris Salkazanovs as the party's chairman, LETA reported. The party congress, attended by 108 delegates, elected Anita Jakobsone and Martins Kossovics from the SDS youth organization as Salkazanovs's deputies.
* A survey conducted by the public-opinion polling company SKDS in January indicated that public support for electing the president by a direct vote of the people remained very strong, BNS reported on 27 February. Some 55 percent said that they firmly supported direct presidential elections with an additional 25 percent saying that this was preferable to the current system of election by the parliament. Only 12 percent favored the current system, with 8 percent having no opinion. In a similar poll in 1998, 83 percent of the respondents favored direct presidential elections.

Forty-six-year-old Rolandas Paksas was inaugurated as Lithuania's new president in a 26 February ceremony in parliament that was presided over by Constitutional Court Chairman Egidijus Kuris, ELTA reported. Paksas had served two short terms as Lithuania's prime minister: the first for five months in 1999 when he was a board member of the Homeland Union (Conservatives of Lithuania) and the second time for seven months in 2000-01 as chairman of the Liberal Union. Prior to both terms, he served as mayor of the capital city, Vilnius. After the government of the ruling coalition fell apart in 2001, Paksas left the Liberal Union and established his own party, the Liberal Democratic Party, which backed him for the presidency. He defeated incumbent Valdas Adamkus in a runoff election in January (see "RFE/RL Newsline," 6 January 2003). Paksas earned a degree in construction engineering but gained public attention as an acrobatic pilot.

Lord George Robertson began his fourth trip to Vilnius by meeting with recently inaugurated President Paksas on 27 February, ELTA reported. Robertson subsequently congratulated those who had helped make real the dream of the country's membership in NATO, widely expected to be finalized in May 2004. Robertson told the parliament that the list of unfulfilled tasks for Lithuania is short and simple: strengthening anticorruption efforts and continuing military reform. He expressed support for a proposal by parliamentary chairman Arturas Paulauskas that the heads of the parliaments of the "Vilnius 10" meet in Vilnius in May to discuss continuing their cooperation pursuant to NATO membership. In talks with Prime Minister Algirdas Brazauskas, Robertson stressed the need for fighting corruption in Lithuania, especially in customs, public procurements, and the health-care system.

Two days before the end of his term in office, Valdas Adamkus delivered the annual presidential report to parliament on 24 February, ELTA reported. The 33-minute speech, which was broadcast live over Lithuanian Radio, was the shortest of the five annual reports he has given and devoted more attention to domestic than to foreign-policy issues. He criticized lawmakers for taking so long to formulate a position on the terms for holding a referendum on EU membership. Adamkus urged the government and parliament to recognize a greater priority that should be given to national and state development. He expressed disappointment that the government is not devoting enough attention to education and has planned to allocate just 18 percent of would-be EU structural funds for education, as compared to the EU average of 22 percent. The president also called for speeding reforms in public administration and rendering it more effective, transparent, and reliable.

The Lithuanian parliament on 25 February voted overwhelmingly to amend the referendum law by easing the requirements for successful passage of such initiatives, ELTA reported. It retained the condition that more than half of all eligible voters must participate in a referendum but lowered the number of favorable votes needed for passage from the previous one-third of all eligible voters (currently 902,000) to a simple majority of votes cast. The amendments also allow voting to take place over two days, lengthen the term for absentee voting, and widen the list of those eligible to vote from home.

Lithuanian lawmakers on 25 February replaced two of the four members of the parliament's delegation to the EU Convention on the Future of Europe, BNS reported. The left-of-center New Union (Social Liberal) replaced Gediminas Dalinkevicius, who left the party to join the Social Democrats, with Gintautas Sivickas. The party founded by President Paksas, the Liberal Democrats, chose Eugenijus Maldeikis in place of Alvydas Medalinskas, who left parliament to become Paksas's foreign-policy adviser. Vytenis Andriukaitis and Algirdas Gricius remain as deputies from the Social Democrats and the Liberal Union, respectively.

In a speech to the parliament after being sworn into office on 26 February, Paksas declared that he sees a bright future for Lithuania within the community of European states, ELTA reported. He urged the public to vote "yes" in the EU referendum slated for May. The assurance appeared aimed at countering the perception that Paksas might derail his predecessor's efforts to ensure speedy accession to the EU (see "RFE/RL Newsline," 6 January 2003). Paksas said that as a member of NATO, Lithuania will not remain a passive observer but "along with other countries will defend security in Europe and worldwide." He predicted a safe, wealthy, influential, and responsible future for Lithuania and ended his speech by quoting the words of former U.S. President John F. Kennedy, "Ask not what your country can do for you; ask what you can do for your country."

Shortly after his inauguration on 26 February, President Paksas received the formal notice of the resignation of the cabinet of Prime Minister Brazauskas, as required under the Lithuanian Constitution. Paksas responded by requesting that Brazauskas continue in his duties as the head of his two-party, left-wing coalition. The governing Social Democratic Party and the New Union (Social Liberals) are virtually assured of carrying a majority vote in the legislature. Many observers expect a minor cabinet reshuffle, however, with one or more ministers replaced. Health Minister Romualdas Dobrovolskis is regarded as the most likely minister to be dropped in any reshuffle. Paksas associates noted that no member of his right-of-center Liberal Democratic Party will join the Brazauskas cabinet.
* Irish European Affairs Minister Dick Roche held talks on the issue of Lithuania's referendum on EU membership in Vilnius on 25 February with Foreign Minister Antanas Valionis, ELTA reported. Roche was one of the organizers of Ireland's second referendum last October on the Nice treaty, the passage of which was needed to allow the EU to expand. He also had meetings with Seimas Chairman Arturas Paulauskas and Foreign Ministry Secretary Rytis Martikonis.
* Commander of Lithuania's naval forces Captain Kestutis Macijauskas made a visit to Denmark on 26-27 February, BNS reported. He discussed the further development of bilateral military cooperation with Royal Danish Navy Admiral Kurt Birger Jensen. The talks primarily focused on the new priorities of military cooperation after Lithuania joins the EU and NATO, with Denmark continuing its assistance in training officers and decontamination specialists, who could carry out the cleansing of chemical weapons that were dumped in the Baltic Sea during and after World War II.
* Russian Social Democratic Party Chairman and Governor of the Samara region Konstantin Titov held talks in Vilnius on 21-22 February with leaders of the ruling Lithuanian Social Democratic Party, ELTA reported. The Lithuanian party pledged to support Titov's party's efforts to join the Socialist International. On 22 February, the leaders of the two parties signed a communique on bilateral cooperation.
* A delegation from the Ukrainian parliament headed by deputy Oleksandr Tretyakov held talks in Vilnius on 25-26 February with Lithuanian lawmakers about the establishment of a bilateral parliamentary assembly, BNS reported. The visit was a follow-up to a Lithuanian visit to Kyiv in January during which he and Valerijus Tretjakovas signed a protocol of intentions for forming the assembly. The Lithuanian parliament was scheduled to approve the establishment of the assembly during the extraordinary session that will end on 5 March.
* By a vote of 75 to three with two abstentions, the parliament passed on 27 February amendments to the law on referenda that were aimed at increasing participation in the referendum on joining the European Union, ELTA reported. It approved that the referendum would also be held on 10 May in addition to the previously announced 11 May. The voting hours were also expanded to be from 6 a.m. to 10 p.m. instead of the usual 7 a.m. to 8 p.m.
* The meeting of the Council of the Social Democratic Party on 22 February approved a declaration calling on the population to vote "yes" for membership in the EU during the referendum on 11 May, BNS reported. The declaration stated: "EU membership will be beneficial for the Lithuanian people [and] all nations and social groups living in the country. It will help foster our culture, develop the economy and education, improve the social situation, and reduce unemployment and poverty."
* The Statistics Department announced on 25 February that 191,000 foreigners visited the country in January, or 14.8 percent fewer than in January last year, ELTA reported. The decrease was primarily due to a fall in visitors from Belarus (by 25.2 percent), Russia (by 16.6 percent), and Latvia (by 12.4 percent).
* President Paksas told a meeting of Lithuanian diplomatic missions on 27 February that the main goals of his foreign policy will remain membership in the EU and NATO, BNS reported. He said that good ties with the neighboring countries of Latvia, Poland, Belarus, and Russia would also remain a priority and that Lithuania would also share its experience in seeking NATO and EU membership with the countries of the Caucasus and Balkans.
* The parliament's New Union (Social Liberals) faction decided on 24 February to change its leadership, ELTA reported. Alvydas Ramanauskas retained his post as the faction's head, but the number of his deputies decreased from three to two. Vaclovas Karbauskis and Gintautas Sivickis replaced former deputies Gediminas Jakavonis, Dangute Mikutiene, and Vytautas Kvietkauskas.
* Finance Ministry Secretary Asta Ungulaitiene declared on 28 February that the country's state debt declined in January by 280 million litas ($87.5 million) to 12.88 billion litas, ELTA reported. This is about 24 percent of the gross domestic product, or 6 percentage points below the state debt and borrowing limit. Direct foreign loans of 7.31 billion litas comprise 56.8 percent of total state debt.