Baltic Report: May 24, 2002

NOTE TO READERS:
This issue covers events in the Baltic states from 10 to 16 May 2002.
CONSTITUTIONAL AMENDMENTS INITIATED.
Seventy-four parliament deputies expressed support on 16 May for a bill proposing amendments to the constitution necessary for the state to become a member of the European Union, BNS reported. They represented all the parties in the parliament except the People's Union, whose Chairman Villu Reiljan said that his party is not opposed to the EU in principle, but regrets that the negotiators failed to gain advantageous conditions in entry discussions. The bill consists of three parts, the first of which declares that Estonia may accede to the EU. The second states that when Estonia is a member of the EU its constitution will be applied with consideration of the rights and obligations arising from the accession agreement. The third article declares that the act can be amended only by a referendum. The bill must still be passed by parliament and approved in a referendum, which will probably be held simultaneously with a vote on the country's entry into the EU.

EMBASSY IN RUSSIA PROTESTS VANDALISM.
The Estonian Embassy in Moscow sent a note to the Russian Foreign Ministry on 13 May protesting an attack the previous night by Russian extremists and expressing deep concern about the security of the Estonian Embassy, BNS reported. The embassy claimed in the note that six bottles containing dark paint were smashed against the embassy's walls, hitting Estonia's flag and coat of arms that adorn the embassy's facade. The Russian National Bolshevik Party took responsibility for the attack, saying it was a protest against the actions of the Estonian authorities, who the party claims harass and jail chekists and Soviet veterans of World War II, as well as against the discriminatory policies of Estonia against Russians and the country's efforts to join NATO. There is a Russian police post near the embassy, but it is usually unmanned, ETA reported on 14 May.

DEFENSE-COOPERATION AGREEMENT WITH GREECE SIGNED.
Estonian and Greek Defense Ministers Sven Mikser and Yannos Papantoniou signed a defense-cooperation agreement in Brussels on 14 May, BNS reported. The ministers were attending a meeting of defense ministers of European Union member states, candidate states, and non-EU NATO states to discuss plans to create a new EU defense structure -- a rapid-reaction force. According to the agreement, the two countries will begin holding political and defense talks making it possible to exchange defense and security information and discuss other matters of interest. Mikser asked Greece to provide one lecturer for the Baltic Defense College project and invited Papantoniou to visit Estonia. The Greek minister said his country favors extensive NATO expansion and will work to ensure that Estonia receives an invitation to join the defense alliance.

GOVERNMENT SLOW IN PREPARING EU-RELATED LEGISLATION AND REGULATION.
Henrik Hololei, the head of the State Chancellery's European Integration Bureau, said on 15 May that Estonian ministries are slowly preparing the draft laws and government decrees pertaining to the European Union that it had planned to endorse in the first half of the year, ETA and BNS reported. According to Hololei, the government has approved only 13 of the 39 draft laws and 23 of the 81 government decrees necessary for EU membership. The Finance Ministry has so far prepared only two of seven draft laws; the Agriculture Ministry, two of six; and the Environment Ministry just one of six. Of the planned government decrees, the Agriculture Ministry has yet to approve 22 decrees, and the Finance Ministry has not approved 11.

RUSSIAN ORGANIZATION SEEKS NEW RUSSIAN SCHOOLS IN ESTONIA.
Arkadii Prisyazhnyi, the chairman of the Union of Russian Compatriots' Association in Estonia, has said there are plans to establish Russian secondary schools in Tallinn and Narva that would follow the Estonian curriculum while paying more attention to teaching the Russian language and literature, "Eesti Paevaleht" reported on 13 May. Estonian and Russian authorities are both expected to support the schools financially. Former Education Minister Tonis Lukas has backed the plans, noting that the schools could receive aid from Russia in the form of language teachers and books that would both have to be registered with the Estonian Education Ministry. Prisyazhnyi declared his opposition to Russian higher-education schools establishing affiliates in Estonia, as this is not allowed under Estonian law. He expressed regret that the branches of several Russian-language universities in Estonia use Russian curricula and ignore the realities in Estonia, and suggested that one university be established from the 10 private higher-education schools currently in the country. They would remain independent, but there would be "an umbrella organization to check on what is being taught, and how," Prisyazhnyi said.

* During the international conference "European Security and Defense Policy" in Tartu on 10-11 May, Russian Ambassador to Estonia Konstantin Provalov stated that Russia opposes the admission of the Baltic states into NATO, ETA reported. He said, "The accession of the Baltic states to NATO will not add any stability in the Baltic states, NATO, or Russia."

* Ukrainian Foreign Minister Anatoliy Zlenko made an official visit to Estonia on 13-14 May during which he held separate talks with President Arnold Ruutel, parliament Chairman Toomas Savi, Foreign Minister Kristiina Ojuland, and Economy Minister Liina Tonisson, BNS reported. He told Savi that the new Ukrainian parliament has a majority supporting greater European integration. Zlenko also indicated that Ukraine wanted to improve its relations with NATO.

* Japanese Deputy Foreign Minister Shigeo Uetake held talks in Tallinn on 14 May with President Ruutel during which he welcomed Estonia's achievements in implementing information technology, ETA reported. He also discussed bilateral relations, EU enlargement, and international security with Prime Minister Siim Kallas and Foreign Minister Ojuland.

* Sweden donated an oil-spill-containment ship to Estonia's Border Guard on 15 May, in effect doubling the service's ability to cope with oil pollution, ETA reported the next day. The 40-meter-long ship was built in Germany in 1966 as a trawler, but was overhauled in 1985 and fitted with oil-gathering equipment, water cannon, and tanks for holding polluted water.

* A delegation, led by Tallinn Mayor Edgar Savisaar, reopened the representation of the city of Tallinn in Brussels on 13 May, BNS reported. The representation had been opened in 1999, but was closed down in 2000 when the city government was taken over by the coalition of Pro Patria Union. Reform Party, and Moderates. The delegation held talks with EU Enlargement Commissioner Gunther Verheugen and Regional Policy Commissioner Michel Barnier.

* After two days of talks in Tallinn on 13 and 13 May, the fishery authorities of Estonia and Lithuania decided to sign an agreement on cooperation in fishing, BNS reported on 14 May. Head of the Fishery Department of the Estonian Environment Ministry Ain Soome said that a draft agreement, setting out the basis for different forms of cooperation, would be sent to Vilnius soon.

* The government on 14 May agreed to ask for a longer transition period for its oil shale industry in its EU membership negotiations, ETA reported. Most of the country's electricity is produced from local oil shale at two Narva power plants which are being renovated. The EU is urging Estonia to open immediately its energy market to free competition which could result in dependence on Russian oil or natural gas. Estonia hopes to close the energy chapter at the round of talks on 11-12 June.

* Former Tallinn Mayor Tonis Palts announced on 16 May that he is leaving the Pro Patria Union and joining the Res Publica party, BNS reported. It appears likely that he will be a candidate for the party's chairman in August after Rein Taagepera resigns from the post.

* Representatives of Tallinn Pedagogical University, the Estonian Institute of Humanities, the Estonian Academy of Arts, the Estonian Academic Library, and the Institute of History signed an agreement on 15 May on joint action which is to lead to the foundation of Tallinn University, ETA reported. The merger will not be completed before the 2003/2004 academic year. Tallinn University is expected to be the country's third-largest university, following Tartu University and Tallinn Technical University.

* Estonian Ambassador to the United Nations Clyde Kull became the country's first representative ever to have been elected chairman of an organization affiliated to the United Nations, when he became the head of the Economic Commission for Europe, BNS reported on 13 May.

VISIT BY NATO DEPUTY SECRETARY-GENERAL.
Robert Bell discussed Latvia's achievements in seeking NATO membership with Foreign Minister Indulis Berzins in Riga on 10 May, LETA reported. Bell praised the Latvian parliament for abolishing the language requirement for candidates to the parliament and local councils. Berzins noted that Latvia is actively cooperating with Russia and other CIS countries and willingly offers to share its experience in economic reform. In talks with Defense Minister Girts Valdis Kristovskis, Bell spoke about the possible participation of Latvian scientists in NATO military programs. Bell also held talks with National Armed Forces Commander Raimonds Graube about Latvia's arms policy and air-defense plans.

BRITISH PARLIAMENTARY DEPUTIES PRAISE LATVIA'S NATO-INTEGRATION PROCESS.
A delegation from the British House of Commons Defense Committee, headed by its Chairman Bruce George, arrived in Riga on 13 May to review security problems in the Baltic Sea region and the implementation of the country's NATO Membership Action Plan, LETA reported. Foreign Minister Indulis Berzins said NATO enlargement would contribute to regional security and benefit all countries in the region, including Russia. George told President Vaira Vike-Freiberga that he is impressed with Latvia's achievements in NATO-integration matters. The next day he told Prime Minister Andris Berzins that he believes Latvia will receive an invitation to join NATO at the alliance's Prague summit in November. The delegation also met with parliament Chairman Janis Straume and other deputies, and visited the BALTBAT Adazi military-training grounds and Latvia's Defense Academy before departing for Lithuania.

DUTCH ARMED-FORCES COMMANDER SAYS LATVIA READY FOR NATO MEMBERSHIP.
Admiral Luuk Kroon told Defense Ministry State Secretary Edgars Rinkevics in Riga on 15 May that Latvia has successfully completed all preconditions to become a full-fledged NATO member state, LETA reported. He praised the performance of the Latvian armed forces units during peacekeeping operations and in international training programs. The officials discussed aspects of Latvian-Dutch military cooperation, Latvia's efforts to join NATO, and strengthening defense capabilities. Kroon spoke about the restructuring of the Dutch armed forces and their transition to a professional service. Rinkevics pointed out that Latvia's defense system is based on two principles -- strengthening defense capabilities and the development of specialized units (field engineers, military police, and medics) for NATO-led operations.

BALTIC ECONOMIC FORUM OPENS IN RIGA.
The two-day "Fourth Baltic Forum on Economic and Social Development in the Baltic States" was officially opened in Riga on 13 May with about 250 high-ranking politicians, businessmen, investors, and economists from the Baltic countries, Russia, and Western Europe in attendance, LETA and BNS reported. President Vike-Freiberga opened the forum with a speech that stressed the role that NATO and EU membership for Poland and the Baltic states can play in the region's development. Latvian Prime Minister Andris Berzins and former Estonian and Lithuanian Prime Ministers Mart Laar and Kazimiera Prunskiene also addressed the forum. Berzins noted that Latvia's economic situation is improving and that the country plans to further develop computer technologies and wants to improve the computer education of young people. Laar noted that Baltic cooperation is needed more in defense than in the economic sphere, as the Baltic states now boast some of the highest economic growth rates in Europe. Prunskiene said that problem issues include increasing the competitiveness of businesses and creating good preconditions for investment. Riga Mayor Gundars Bojars stated that Latvia's economy will remain very dependent on Russia in the future and that it is easier for Latvian businessmen to establish economic relations with colleagues in Russia than in EU countries.

LATVIA OVERTURNS DECISION ON CONSTRUCTION OF ICE HOCKEY ARENA.
The organizing committee for the 2006 Ice Hockey World Championship in Riga, headed by Prime Minister Andris Berzins, decided on 15 May to overturn its decision of 15 April selecting the Swiss company IMS Studio 6 to build the new hockey arena necessary to hold the event, LETA reported the next day. The decision was prompted by the failure of IMS Studio 6 to submit a draft contract on time. The committee also decided that it will only act as a supervisory institution in the future, which in effect delegates the Latvian Ice Hockey Federation (LHF) to decide which company will construct the arena. In an interview on Latvian State Radio, Finance Minister Gundars Berzins criticized the committee's decision to entrust the LHF with selecting the contractor for the arena and affirmed that the construction will definitely require state financial support.

* A parliament delegation, visiting Germany on 12-14 May, heard expressions of support for their country's membership in the EU and NATO from officials of the German Foreign and Defense ministries and Bundestag deputies, LETA reported on 15 May. In concluding the visit, Latvian Ambassador to Germany Andris Teikmanis presented the Three Star Order to Bundestag Baltic Support Group Chairman Baron Wolfgang von Stetten.

* A delegation of visiting Italian parliament deputies, headed by the chairman of the Italian-Baltic cooperation group, Ricardo Migliori, held talks with parliament Deputy Chairman Rihards Piks and Foreign Affairs Committee Chairman Guntars Krasts, Foreign Ministry Deputy State Secretary Martins Virsis, and Riga city leaders on 16 May, BNS reported. Migliori suggested greater cooperation between Florence and Riga, noting that they are both ports with similarly developed infrastructures.

* Defense Minister Girts Valdis Kristovskis flew to California for an eight-day visit on 10 May, BNS reported. He read a lecture at the Defense Resources Management Institute's Navy Postgraduate School in Monterey, which he had attended in 1995 and met with advisors of California Senators Dianne Feinstein and Barbara Boxer at their offices in San Francisco as well as U.S. administration officials. Kristovskis also met with representatives of the Latvian community in San Francisco and Los Angeles.

* President Vike-Freiberga and several hundred Orthodox believers attended a liturgy in the Orthodox Cathedral of the Holy Nativity in Riga on 11 May, which was held in honor of the ordination of Archbishop Aleksandr as the metropolitan of the Latvian Orthodox Church, LETA reported. Russian Patriarch Aleksii II had ordained Aleksandr as metropolitan at the end of February, thereby recognizing the Latvian Orthodox Church's independence from the Moscow Patriarchy.

* The parliament rejected on 16 May the proposal by For Human Rights in a United Latvia (PCTVL) to amend the privatization vouchers law by extending the validity of the vouchers for one more year until the end of 2003, LETA reported. PCTVL argued that more than 13 million vouchers had not yet been used and it was unlikely that all large state-owned enterprises would be privatized this year.

* The parliament adopted on 16 May changes to its own regulations that fix the payments of compensations, salary, and representation costs of deputies, which the Constitutional Court had ruled earlier in the year as inconsistent with the country's constitution, BNS reported. Contrary to previous practice, compensations for rent and travel will be paid only after providing documentation.

* By a vote of 46 to three with 27 abstentions, the parliament approved Chairman of the Criminal Court Chamber Ivars Bickovics as a Supreme Court judge for an unlimited term of office on 16 May, LETA reported. He was first appointed to the Supreme Court for a 10-year term in 1992.

* The Statistics Office announced on 13 May that in the first quarter of the year Latvia's exports increased by 2.5 percent compared to the same period last year while imports rose by 6.8 percent, BNS reported. Exports to EU countries declined by 4.7 percent, but imports grew by 12.3 percent. However, exports to CIS countries increased by 12.7 percent and imports from them dropped by 13 percent

* The National Employment Service announced that the number of unemployed persons registered in Latvia on 1 May was 96,446 or 1,178 fewer than a month earlier, BNS reported. The official unemployment rate fell from 8.2 in March to 8.1 percent in April.

LITHUANIA, POLAND REJECT IDEA OF CORRIDOR TO KALININGRAD.
Poland's Premier Leszek Miller and Foreign Minister Wlodzimierz Cimoszewicz on 13 May ruled out any possibility of a special Russian transit corridor through Poland linking the Kaliningrad Oblast exclave with the rest of the Russian Federation. The politicians were responding to a recent report in Germany's "Der Spiegel" claiming that Russia is lobbying the European Union to influence Poland and Lithuania to agree to special Russian transit corridors within their borders. "At a meeting in Kaliningrad between the Russian, Lithuanian, and Polish prime ministers I heard similar demands," Miller told Polish Radio. "But at the same time there is an unequivocal answer from the neighbors sharing their borders with the Kaliningrad Oblast -- i.e., Poland, Lithuania -- and the EU countries: there aren't going to be any exceptions in applying the union law and the Schengen criteria are going to be applied. Hence, all corridors or similar ideas are out of the question," Miller added.

BANK OF LITHUANIA REJECTS LARGE INVESTMENT IN SNORAS BANK.
The board of the Bank of Lithuania rejected the request by French citizen Jean-Philippe Iliesco de Grimaldi to acquire a new 1.2 billion-lita ($315 million) share issue of Snoras Bank, BNS reported. If the issue had been approved Snoras would have risen from the fourth-largest commercial bank in Lithuania to the first in the Baltic states. Earlier that day, State Security Department General Director Mecys Laurinkus told a news conference that some persons involved in the planned Snoras investment had direct ties with Russian and international organized crime groups. However, he stressed that his words linking the investment with international organized crime did not apply to de Grimaldi. Bank of Lithuania Chairman Reinoldijus Sarkinas said that the board unanimously decided to reject the request because the submitted documents failed to prove that the money was obtained lawfully and that its origin was legal.

GERMAN BUNDESTAG CHAIRMAN PROMISES SUPPORT FOR ACCESSION TO NATO.
Wolfgang Thierse assured parliament Chairman Arturas Paulauskas in Zagreb on 10 May that Germany supports Lithuania's membership in NATO, ELTA reported. They were attending a conference of European parliament chairmen in the Croatian capital to which Paulauskas delivered a speech titled "Democracy Against Terrorism: National Strategies." Paulauskas also held separate talks with Croatian parliament head Zlatko Tomcic, Spanish Senate President Esperanza Aguirre Gil de Biedma, and Portuguese parliament leader Joao Bosco Soares Mota Amaral. Amaral vowed to form a group in the Portuguese parliament that would promote closer cooperation with the Lithuanian parliament, and invited Paulauskas to visit Lisbon.

PREMIER VISITS FINLAND.
Algirdas Brazauskas flew to Helsinki on 13 May and gave an interview with Finnish television the next day in which he spoke about Lithuania's preparedness for joining the European Union and NATO, ELTA reported. When asked whether he plans to run for president again, Brazauskas replied that he will decide only after the Social Democratic Party's congress in the fall. Prime Minister Paavo Lipponen later told him that the European Union is unlikely to change its decision demanding that the Ignalina nuclear power plant be shut down by 2009, but that Finland will support Lithuania's efforts to obtain more EU funding for the plant's closure. Later talks with President Tarja Halonen focused mostly on Lithuania's efforts to join the European Union and its relations with Russia's Kaliningrad Oblast exclave.

NATO NAVAL EXERCISES HOSTED.
Ten ships from Great Britain, Estonia, Latvia, Lithuania, France, Sweden, and Finland gathered on 13 May near Klaipeda to participate in the international naval exercises Cooperative Ocean 2002 under NATO's Partnership for Peace program, BNS reported. They will last until 16 May and be the first NATO Partnership for Peace exercises held within the framework of the alliance's operational capabilities concept and interoperability assessment program. A group of 25-30 specialists will evaluate the preparedness of the vessels of Partnership for Peace program countries for conducting naval operations with NATO ships, particularly their mine sweepers.

TREATY ON AVOIDING DOUBLE TAXATION WITH GREECE SIGNED.
President Valdas Adamkus met with his Greek counterpart Constantinos Stephanopoulos on 15 May at the beginning of a three-day visit to Greece, ELTA reported. The presidents signed a treaty on avoiding double taxation, which they hope will help boost economic and trade relations between their countries. In 2001, Greece ranked 48th among importers to Lithuania and 60th among exporters. Nine representatives of Lithuanian business, including the heads of the International Chamber of Commerce in Lithuania and of the dairy "Zemaiciu pienas," accompanied the president to Athens. Adamkus urged Greece to open an embassy in Vilnius, but it is still not clear in which one of the three Baltic capitals Greece will do this. Adamkus also held talks with Prime Minister Constantinos Simitis on bilateral economic and cultural ties, Lithuania's efforts to join NATO and the European Union, and international relations. Adamkus was scheduled to meet with leaders of the Greek parliament and opposition factions on 16 May.

* A delegation from the British House of Commons Defense Committee, headed by its Chairman Bruce George, held talks in Vilnius on 14-15 May with President Adamkus, Foreign Ministry State Secretary Evaldas Ignatavicius, and members of the parliament Foreign Affairs and National Security and Defense Committees, BNS reported. George told a press conference that Lithuania deserves to receive an invitation to join NATO since it had already proved it is capable of contributing to the strengthening of security in Europe.

* Parliament Chairman Arturas Paulauskas told Ricardo Migliori, the head of a visiting Italian parliament delegation, on 15 May that France had solved the problem of returning the former Baltic embassies which the Soviet Union took over during World War II by giving the Baltic states compensation which could be used to purchase new facilities, BNS reported. He noted that the same situation exists in Rome where Russia refuses to return the former Lithuanian Embassy building.

* Deputy Chairman of the Russian State Customs Committee Vladimir Mescheriakov informed Lithuanian Customs Department Director Valerijonas Valickas on 14 May that Russia will require only 89 Lithuanian trucking companies to hire police escorts to accompany cargoes they send to Russia after 15 May, BNS reported. The more than 1,000 other Lithuanian truckers will not be subject to any restrictions while carrying goods to Russia.

* World Customs Organization Secretary-General Michel Danet told a press conference at the Lithuanian Customs Department on 16 May that Lithuania should enlarge its customs checkpoints and accelerate the acquisition of equipment with modern information technologies to ensure effective control and faster service, ELTA reported.

* The head of the parliament European Affairs Committee, Social Democrat Vytenis Andriukaitis, told a press conference in Vilnius on 13 May about his recent trip to Spain, which currently holds the EU presidency, BNS reported. He said that Spanish officials urged Lithuania to close the energy chapter of its EU membership negotiations by July because Spain fully supports the EU position that the nuclear power plant at Ignalina should be closed by 2009.

* The parliament passed a resolution on 15 May authorizing the government to hold negotiations with the European Union over the closure of the second reactor at the Ignalina nuclear power plant, ELTA reported. It urges the government to seek large EU financial assistance without which the closure would be impossible. Although the EU is demanding that the plant be closed by 2009, the resolution foresees its closure between 2009 and 2015.

* President of the World Esperanto Union Renato Corsetti told a press conference in the Lithuanian parliament on 15 May that the 90th congress of the organization would be held in Vilnius on 23-30 July 2005, BNS reported. About 3,000 delegates from 70 countries should attend the congress. Corsetti said that Vilnius defeated Beijing for holding the congress in part because the founder of the international Esperanto language, Ludwig Zamenhof, had been born in the historical territory of Lithuania.

* During a visit to Warsaw on 14 May, Education Minister Algirdas Monkevicius held talks with his Polish counterpart Krystyna Lybacka, ELTA reported the next day. The ministers discussed problems faced by Polish schools in Lithuania and Lithuanian schools in Poland and signed a communique envisaging commitments of Lithuania and Poland in the field of education and scientific research. This was the first visit to Poland by Monkevicius who invited Lybacka to visit Lithuania in September.

* Leaders of the four largest political parties, the Social Democratic Party, New Union (Social Liberals), Homeland Union (Conservatives of Lithuania), and Liberal Union, and nine influential public organizations, the Lithuanian Industrialists Confederation, Lithuanian Chamber of Commerce, Lithuanian Trade Union Confederation, Rectors' Conference, Foreign Investors Forum, Lithuanian Agricultural Chamber, INFOBAT Association, Knowledge Economy Forum, and the Council of Lithuanian Youth Organizations signed a Memorandum of Mutual Understanding on 16 May, ELTA reported. They agreed that the major goal of Lithuania in the next 15 years was ensuring significant growth of its economy and social welfare. The leaders of seven smaller parties agreed with the initiative, but complained that they had been left out deliberately.

* Chairmen of the Christian Democrats and Liberal Democrats Kazys Bobelis and Rolandas Paksas signed an agreement on 10 May to cooperate in the local council elections, which are scheduled for February-March 2003, but may be held with the presidential elections in December, BNS reported. The chairmen, both of whom are likely to run for president, noted that the agreement was not a coalition, but an attempt to join center-right forces in the country.

* Liberal Union parliament deputy Algimantas Matulevicius announced on 13 May that he intends to be a candidate for president, ELTA reported. He said that during trips around Lithuania he had frequently been urged to run for president and felt certain that it would not be difficult to gather the 20,000 signatures necessary to be a candidate. The Liberal Union has already voted to support its Chairman Eugenijus Gentvilas for president.