Baltic Report: October 16, 2002

NOTE TO READERS:
This issue covers events in the Baltic states from 28 September to 4 October 2002.
RAPID NATO ACCESSION TALKS PROMISED.
NATO Deputy Secretary-General Guenter Altenburg met with Ambassador to NATO Sulev Kannike in Brussels on 30 September to discuss Estonia's fourth annual national plan under NATO's MAP program, which was presented a week earlier, BNS reported. Altenburg noted that accession talks with the countries that are considered likely to be invited to join the alliance at the Prague summit in November will proceed rapidly, and NATO is already preparing to take in new members. He said NATO member states will ratify the candidates' membership agreements swiftly so that they can be officially admitted at the next NATO summit in the summer of 2004.

RUSSIAN COAL FIRM TO BUILD EXPORT TERMINAL IN TALLINN.
Russia's second-largest coal producer, Kuzbasrazrezugol, signed an agreement on 30 September to build a coal-export terminal at Tallinn's Muuga Port, ETA reported on 2 October. Tallinn Port Marketing Director Erik Sakkov said the contract was secured when the port promised a more rapid construction timeline -- the initial 120,000-ton facility is to be completed by 1 January 2005 -- than the competing Lithuanian port of Klaipeda. The terminal will create about 100 new jobs and is expected to export 5 million tons of coal a year. Sakkov noted that the agreement will help to reduce the port's dependence on oil shipping, which currently accounts for 65 percent of its turnover.

AGREEMENT ON PROTECTION OF CLASSIFIED INFORMATION SIGNED WITH TURKEY.
Foreign Ministry Deputy Chancellor Vaino Reinart and his counterpart from the Turkish Defense Ministry, Suleiman Arikan, signed an agreement on the protection of classified information on 2 October in Ankara, BNS reported. Earlier that day, Turkish Foreign Ministry Undersecretary Ugur Ziyal assured Reinart of Turkey's support for Estonian membership in NATO and expressed the hope that the two countries "will soon be sitting at the same table in both the European Union and NATO." Reinart is scheduled to hold talks with Turkish businessmen and participate in the opening of Estonia's second honorary consulate in the resort town of Antalya (the first in Istanbul) on 4 October.

ESTONIA'S RUSSIAN ORTHODOX CHURCH MAINTAINS DEMAND FOR LEGAL SUCCESSION.
Metropolitan Cornelius, head of the Estonian Orthodox Church of the Moscow Patriarchate, said on 4 October that his church is not abandoning its demand to be recognized as the legal successor to the Orthodox Church that existed in Estonia before World War II, BNS reported. He expressed satisfaction, however, with the government's official hand over that day of 18 churches and congregational buildings to be used for 50 years for a symbolic rent of one kroon per month. The Estonian Apostolic Orthodox Church, which Estonia has recognized as the legal successor, is subordinate to the Constantinople Patriarchate. It ceded to the government the de facto use of the 18 buildings in exchange for government aid of 35.5 million kroons ($2.2 million) to renovate 28 of its churches.

PREMIER SUGGESTS POSTS OF PRESIDENT AND PREMIER COULD BE COMBINED.
At a forum of civil servants in Tartu on 3 October, Siim Kallas suggested that the position of prime minister could be eliminated in Estonia and the role handed over to the president, ETA reported. He added that it appears likely that the constitution will be changed so that the president would be directly elected. Currently the president is chosen by the parliament or by a special electoral body consisting of the parliament and representatives of local governments. Kallas said that if the next president is elected directly by the people, he or she would be able to play a greater role in governing the state. Combining the positions of president and prime minister would simplify foreign relations and make responsibilities and representative functions clearer, Kallas added. He also cautioned that his proposals were made simply for further discussion, with the aim of making the Estonian state structures more flexible.

* Defense Ministry officials held defense policy talks with their Danish counterparts in Copenhagen on 30 September and 1 October, BNS reported. In addition to the expansion of NATO and the fight against international terrorism, the talks also analyzed earlier cooperation and discussed specific projects such as the completion of shooting ranges at Klooga by 2005 and the development of the Amari airfield.

* At a summit of Central and East European center-right parties in Prague on 28 September, Pro Patria Union board member Liisa Pakosta compared Center Party Chairman Edgar Savisaar with Slovak autocratic politician Vladimir Meciar and proposed the formation of an anti-Center Party coalition comprising the Pro Patria Union, Res Publica, Moderates, and perhaps the People's Union, BNS reported on 30 September. Representatives of the other parties did not back the proposal noting that a coalition could only be negotiated after the results of the election are known.

* Ambassador to Sweden Toomas Tiivel submitted a note on 30 September to the Thailand Embassy in Stockholm asking for the transfer to Estonia of four Estonians, arrested in Thailand with 5.8 kilograms of heroin in 1995 and serving sentences in a Bangkok prison, BNS reported. The two countries had signed an agreement allowing the transfer of prisoners to complete their imprisonment in their homelands in 2000, but the ratification letters of the agreement were exchanged only this spring.

* With the cooperation of their Finnish and Russian counterparts, the Estonian border guard services have smashed a human smuggling ring, which transported Kurdish illegal immigrants from Iraq to Finland, ETA reported on 30 September. They arrested nine members of the smuggling gang, which was led by the head of the Kurdish society in Estonia. Finnish border guards had caught an Estonian yacht in Helsinki harbor on 8 September with eight Kurds which were to be smuggled into Finland. Further investigation revealed that the ship had been used successfully two times to transport other Kurds.

* Prime Minister Kallas told the business conference titled "Business Plan 2003" on 2 October that the lack of qualified labor is the main problem for the sustainability of the Estonian economy, ETA reported. He said "Shortage of qualified labor is becoming our main problem; our development will in the future be determined not by the financial environment but by the human factor." Kallas called for improving access to university and vocational education. At the same time he noted that the country will have to accept the necessity of importing qualified foreign labor which can help increase Estonia's development.

* A roundtable of parliamentary factions on 2 October rejected the proposal prepared by the Justice Ministry to amend the constitution to extend the president's term of office from the current five to seven years, BNS reported. They supported the direct election of the president by the people, but left to the parliament to decide on the system of election. The ministry had suggested a single round of voting during which the voter would rank the candidates in order of preference and the number of first, second, third, etc., rankings of a candidate would be taken into account. The other alternative is holding a second round of elections between the two top candidates if no candidate received a majority in the first round.

* The State Audit Office declared on 3 October that the present system of subsidizing rail passenger traffic was ineffective and other means of transport, such as buses, would be more economical, BNS reported. It claimed that the income from passenger tickets covered only about 10 percent of the transportation costs. The Transportation Ministry responded the next day by declaring that the audit office's figures were incomplete as they did not include the costs of the roads that would have to be built to replace railroads. It, however. agreed that train transport in the current form is too expensive for the state and the subsidy should be changed to be more passenger-centered and more economically effective.

* The Tallinn city government plans to abolish the city's motor vehicle tax, established in 1996, at the end of the year even though the tax was collected with 99.8 percent efficiency, ETA reported on 1 October. The government decided that the collected revenues supplied only a very small part of the costs of road construction and repairs in the city and people were registering in other municipalities to avoid paying the tax.

* In the first nine months of the year, the Port of Tallinn serviced 4.64 million passengers or 4.1 percent more than in the same period last year, ETA reported on 1 October. Almost 80 percent of the passengers were between Tallinn and Helsinki. In the same period the port also increased the handling of cargo by 15.6 percent to 28.39 million tons.

* Nordic Jet Line, one of the shippers in the Tallinn-Helsinki route, set a record for the season, transporting 362,000 passengers on its two catamarans, Aripaev Online reported on 1 October. July was a record month for Nordic Jet Line as 84,937 passengers and 8,036 cars were carried across the gulf.

* The Statistical Office announced on 4 October that in August exports totaled 4.64 billion kroons and imports 6.09 million kroons, resulting in a trade deficit of 1.45 billion kroons ($96 million), BNS reported. This was considerably lower than the 2.6 billion kroon deficit in July because exports increased by 15 percent while imports declined by eight percent. The state's current account deficit in the second quarter of the year was 3.04 billion kroons or 10.6 percent of gross domestic product.

* On a per capita basis, Estonian companies invest more money abroad than any other Central and Eastern European country, ETA reported on 3 October. Their per capita investments of $131 are more than double those of the second place country Slovenia ($52). The per capita investments of Latvia and Lithuania are only $3 and $2, respectively.

FRENCH PRESIDENT SATISFIED WITH DYNAMIC RELATIONS.
During a meeting with his Latvian counterpart Vaira Vike-Freiberga in Paris on 1 October, Jacques Chirac voiced satisfaction over the dynamic relations between the two countries and welcomed Latvia's expected membership in the EU and NATO, LETA reported. He said that Latvia's requests for higher agricultural quotas from the EU are well-founded and require a concrete response. In talks the previous day with French Minister for European Affairs Noelle Lenoir, Vike-Freiberga stressed the need to continue internal reforms within the EU and the enlargement processes in order to reach the goal of a united Europe. On 2 October, she addressed the French Senate, a distinction given previously only to German Chancellor Helmut Kohl and Czech President Vaclav Havel. Vike-Freiberga also met with UNESCO Executive Board Chairwoman Aziza Bennani, who invited her to speak about Latvian folk songs at the organization's next General Assembly.

EC PLEDGES TO SOLVE FARM-QUOTAS ISSUE.
European Commission (EC) President Romano Prodi told visiting President Vike-Freiberga in Brussels on 3 October that the EC will make every effort to resolve the question of Latvia's agricultural quotas, BNS reported. He said the EC has received new statistical data about Latvia's agricultural output, which are being assessed by experts. But he added that all countries should be treated equally. Earlier that day, EC Enlargement Commissioner Guenter Verheugen assured her that there should be no problems for Latvia to become a member of the EU. Later, Vike-Freiberga discussed European security and defense policy with European Council Secretary-General Javier Solana, who expressed the hope that the EU will form a rapid-reaction force by 2003.

INTERIOR MINISTER DISMISSED.
Prime Minister Andris Berzins dismissed Mareks Seglins after an hour-long meeting on 30 September, Baltic agencies reported. The action was likely related to parliamentary elections to be held on 5 October. Earlier the same day, the Organized Crime and Anticorruption Bureau detained two staff members of the Riga office of the political party Latvia's Way on suspicion of disseminating false information about People's Party candidates for parliament. Latvia's Way Chairman Berzins charged that People's Party member Seglins had used "facts that have not been established...to undermine the reputation of Latvia's Way for political purposes." Seglins countered by saying that Berzins acted hastily in firing him without waiting for evidence that could be unfavorable for Latvia's Way. Seglins explained that his ministry had reported the detention of the Latvia's Way members, "so that the community would know for whom to vote." Berzins has appointed Defense Minister Girts Valdis Kristovskis of the For the Fatherland and Freedom party (LNNK) as acting interior minister.

CRIMINAL POLICE CHIEF ON LEAVE AS SLANDER INVESTIGATION CONTINUES.
State Police Chief Juris Reksna on 2 October accepted Criminal Police Chief Valdis Pumpurs' request to be relieved of his duties while an investigation continues into a possible slander campaign directed at People's Party's deputies, LETA reported. Prime Minister Berzins has already dismissed Interior Minister Mareks Seglins over alleged misuse of the police force for political aims. Berzins on 2 October filed a request by Latvia's Way parliamentary deputies for prosecutors to investigate allegations that two of its employees, Ervins Straupe and Binnija Arberga, had ordered the printing of defamatory leaflets from the publishing house "Adverts," whose director, Igors Svans, and a courier were also arrested. Earlier in the day, People's Party Chairman Andris Skele and Latvia's Way Deputy Chairman Ivars Godmanis in interviews with Latvian State Radio urged voters to disregard the slander scandal and cast their ballots on 5 October based on party platforms.

* The Bank of Russia canceled its order issued in May 1998 which required Russia's credit institutions to protect investments by getting Latvian government guarantees for transferring capital to Latvia, BNS reported on 3 October. This action was taken "to further develop Russian and Latvian cooperation in the financial and banking sectors, as well as due to the constructive results from recent contact between Latvian politicians and the Russian administration." The bank also made it easier for Latvia's banks to conduct operations in Russia by removing Latvia from the list of off-shore zones.

* Environment Protection and Regional Development Minister Vladimirs Makarovs and United Nations Development Program resident representative in Latvia Gabriele Koehler in Riga on 3 October signed an agreement on two environment protection projects envisaging introduction of four UN conventions in Latvia, BNS reported. One project, which will receive financing of $212,000, provides for an assessment of the current situation while introducing the UN conventions on climate changes, biological diversity, and desertification. The second project, getting $477,400 of assistance, will prepare for the introduction of the Stockholm convention on persistent organic pollution by counting persistent organic pollutants and developing measures for reducing them.

* After the international energy conference "Energy Supply Safety in the Baltic Sea Region in the Context of the European Union Enlargement" held in Ventspils on 30 September, Transportation Minister Anatolijs Gorbunovs said that EU enlargement would not create more obstacles, but open up new opportunities for regional cooperation in energy transportation in the Baltic region, BNS reported. The conference agreed to set up a special task force to prepare an international cooperation action plan to improve the safety of hydrocarbon transportation and called on the European Commission to assume leadership of the group.

* During a meeting with World Bank governors in Washington on 30 September, International Financial Affairs Minister Roberts Zile signed an agreement for a $20 million loan, BNS reported. The loan is for implementing government reform programs in the next three years.

* Finance Minister Gundars Berzins informed IMF Europe II Department Director John Odling-Smee in Washington that Latvia was not intending to sign any more cooperation memoranda with the fund, BNS reported on 1 October. Signing the memoranda gave Latvia the right to borrow money from the organization, but it had not used this opportunity since 1993.

* The Latvijas Kugnieciba (LASCO) shipping company ended its dispute with the Polish Gdansk shipyard over its canceling an order to construct six refrigerator ships in 1994 by agreeing to pay the shipyard $15 million, BNS reported on 3 October. The case had been going through French and British courts with the shipyard demanding $22-29 million in financial damages.

* The United States Peace Corps concluded its technical assistance program in Latvia on 30 September, LETA reported. The press and culture department of the U.S. Embassy said that during the 10-year long program 189 volunteers had served in Latvia, focusing on teaching English and assisting small businesses and nongovernmental organizations. The volunteers served in 67 cities and towns throughout Latvia.

* Quoting Moscow City International Relations Department head Vladimir Lebedev, the Russian-language daily "Telegraf" wrote on 30 September that Moscow Mayor Yurii Luzhkov will likely visit Riga on 7-8 November, BNS reported. Luzhkov had planned the visit for 27-29 September, but decided to postpone it so that it would not affect the parliamentary elections in early October.

* The Bank of Latvia announced on 30 September that the state's current account deficit in the second quarter of the year reached 116.7 million lats ($187 million), BNS reported. The deficit grew from 3.8 percent of GDP in the first quarter to 9.3 percent in the second. This was primarily due to the trade deficit of 225.6 million lats which was not offset by surpluses for services and current transfers.

* In the first nine months of 2002, Ventspils Nafta, handled 6.9 million tons of crude oil and 4.9 million tons of diesel fuel and other oil products, or a total of 5.6 million tons less than in the same period last year, BNS reported on 4 October. There was a particularly sharp decline in September when exports were only 0.9 million tons compared to 3.2 million tons in September 2001.

YUKOS HOLDS BOARD MEETING IN VILNIUS.
Some 150 high level managers and the heads of YUKOS subsidiaries attended an open session of the YUKOS board in Vilnius on 28 September devoted to its international business projects, "Lietuvos rytas" reported on 30 September. President Valdas Adamkus addressed the meeting and said that Lithuania is ready to cooperate with YUKOS and he hopes the company's activities will be transparent and profitable. YUKOS Chairman Mikhail Khodorkovskii flew to Lithuania two days earlier and inspected the oil terminals at Butinge and Klaipeda. On 27 September he visited the Mazeikiai oil refinery where he met with Prime Minister Algirdas Brazauskas. Khodorkovskii said that he expects Mazeikiu Nafta to become a profitable company which will play an important role in helping YUKOS expand its operations to the West. YUKOS Vice President Mikhail Brudno predicted that in the future YUKOS will export about 45 million tons of oil per year to Europe and the capacities of the refinery and the oil terminals will be used to full capacity.

AGREEMENT TO SEND SOLDIERS TO AFGHANISTAN APPROVED.
By a vote of 65 to 21 with eight abstentions, parliament approved on 1 October sending up to 40 volunteer military personnel to serve in the U.S.-led Operation Enduring Peace in Afghanistan for six months, ELTA reported. Many of the soldiers will be from the special Aitvaras (Kite) unit, which has received training from the U.S. Green Berets. In proposing the mission in September, Defense Minister Linas Linkevicius said the troops would have a special intelligence mission in Afghanistan. They will help identify possible targets and possible threats in order to ensure the safety of other forces participating in the operation. The cost of the mission will be about 1 million litas ($285,000), which will be covered from the Defense Ministry's budget.

RUSSIAN LEGISLATORS TALK TOUGH ON KALININGRAD...
The Russian State Duma held hearings on the issue of Kaliningrad Oblast and international aspects of Russia's national security on 30 September, ITAR-TASS reported. Duma International Affairs Committee Chairman and presidential envoy to the EU for Kaliningrad Dmitrii Rogozin reiterated that Russia will not drop its insistence on visa-free travel between Russia and the Kaliningrad exclave. Rogozin called EU proposals offensive to Russia and said the only concession Russia is ready to make to the EU is to close its southern borders entirely in order to stem the tide of illegal migration, gazeta.ru reported. Meanwhile, EU foreign ministers meeting in Brussels the same day continued to insist that Kaliningrad residents will need a special "travel pass" to cross EU territory after Lithuania and Poland join the EU, Reuters reported. According to the agency, the foreign ministers took note of a Russian proposal for nonstop trains between Kaliningrad and Russia but said a feasibility study for such a project will be undertaken only after EU enlargement.

...AND THREATEN TO REVIEW TERRITORIAL AGREEMENTS WITH LITHUANIA.
During the same hearings, Vladimir Nikitin (Russian Regions) and Viktor Ilyukhin (Communist) called on the Duma not to ratify a border agreement with Lithuania if Vilnius continues to resist Russian demands for visa-free access to Kaliningrad Oblast, gazeta.ru and RosBalt reported on 30 September. They also said that Russia should raise territorial issues concerning the area around the Lithuanian city of Klaipeda. Formerly a part of Germany, the area was designated an "international territory" following World War I and had a disputed status in the interwar period. The Soviet Union unilaterally gave this territory to Lithuania following World War II, and the deputies argued that this decision should be reviewed. Speaking after the Duma session, Russian Ambassador at Large Valentin Bogomazov stated that because the European Union is reluctant to meet Russian needs, Russia should make "extraordinary decisions" as far as Kaliningrad is concerned.

COUNCIL OF EUROPE JUDGES CONFERENCE OPENS IN VILNIUS.
Justice Minister Vytautas Markevicius opened a three-day conference entitled "Professional Improvement of Judges and Prosecutors" for representatives of Council of Europe member countries on 30 September in Vilnius, ELTA reported. This is the first of a planned series of five conferences organized by the Council of Europe to improve training for judges and prosecutors. Markevicius said that too little attention has been devoted to improving the professionalism of judges and prosecutors. The ultimate cost of not investing properly in legal training for lawyers working for the state has been demonstrated by the rulings against Lithuania by the European Court of Human Rights. Markevicius stressed that society would trust law enforcement structures more if it received enough information about them. Markevicius cited as progress the passage of new Civil, Civil Procedural, Criminal, and Criminal Procedural codes and improved relations between the executive and judicial branches in Lithuania.

ANTICORRUPTION PROJECT SIGNED WITH UNDP.
Special Investigations Service Director Valentinas Junokas and United Nations Development Program (UNDP) Resident Representative in Lithuania Cihan Sultanoglu signed an agreement on a joint, two-year anticorruption project in Vilnius on 2 October, BNS reported. The project's budget will exceed 300,000 litas ($86,000) -- two-thirds of it from the UNDP and one-third from the Lithuanian state budget. A roundtable will be held in December on transparency in financing political parties. Plans are also being made to launch a television program on combating corruption. A long-term education program for university-level students is being prepared to involve the younger generation in anticorruption initiatives. The project also calls for public-opinion polls and comprehensive studies of corruption.

BELARUS SLAMS LITHUANIA OVER ANNOUNCED END OF VISA-FREE TRAVEL.
Deputy Foreign Minister Alyaksandr Herasimenka told journalists on 3 October that Lithuania's intention to introduce full-scale visa requirements for all Belarusian citizens is an unfriendly step, Belapan reported. Last month, Vilnius announced that as of 1 January it will cancel the temporary agreement it concluded with Minsk in 1994 on visa-free entry into Lithuania for Belarusian pensioners, residents of border areas, and truckers (see "RFE/RL Newsline," 26 September 2002). "[This measure] runs counter to the principles of good-neighborliness and contradicts the nature and provisions of fundamental OSCE agreements, in particular, the Helsinki Final Act of 1975...under which OSCE member states made commitments gradually to simplify and apply flexible border-crossing procedures and facilitate travel on their territory," Herasimenka noted. He added that Lithuania is being too hasty in introducing visa requirements for Belarusians, since accession to the European Union does not automatically imply accession to the Schengen Treaty.

PUBLIC INITIATIVE TO CUT PERSONAL INCOME TAX IN LITHUANIA.
Members of the right-of-center Liberal Union brought to the Chief Election Commission on 3 October a petition containing 60,891 signatures calling for the gradual reduction of the tax rate on personal income from 33 percent to 24 percent, ELTA reported. If the commission verifies that at least 50,000 of the signatures belong to Lithuanian citizens, parliament will have to consider a draft law on the tax cut. Liberal Union Chairman Eugenijus Gentvilas said his party took the initiative of gathering the signatures after parliament rejected its proposal for the tax reduction. He claimed the tax cut would boost the income of citizens by 950 million litas ($270 million) and lead to a revival of the economy and a decrease in unemployment.

* A delegation of businessmen from Australia's New South Wales, headed by its parliament Chairman John Murray, arrived in Vilnius on 28 September for an eight-day visit, ELTA reported. On 30 September Murray held talks with Parliament Chairman Paulauskas and other parliament deputies, Foreign Ministry Secretary Evaldas Ignatavicius, and First Deputy Mayor of Vilnius Algimantas Vakarinas. On 3 October Murray discussed the advantages of increasing trade and cooperation with President Adamkus.

* A delegation from Belgium's French community, headed by its Prime Minister Herve Hasquin, began a two-day visit to Lithuania on 1 October with a meeting with President Adamkus, ELTA reported. It also met with parliament European Affairs Committee Chairman Andriukaitis. The next day Hasquin and Foreign Minister Valionis signed a cooperation agreement between the Lithuanian government and Belgium's French community and Walloon region. He also delivered a lecture on cultural variety and the role of small countries in uniting Europe at Vilnius University and the delegation visited the historic castle of Trakai.

* U.S. Ambassador to Vilnius John F. Tefft handed over to officials from the Customs Department, State Border Guard Service, and Economy Ministry on 4 October various equipment worth more than $340,000 to improve the protection of the border, ELTA reported The equipment includes 24 portable computers, 20 printers, 20 scanners, 13 digital photo cameras, and a vehicle with a special X-ray system.

* Education Minister Algirdas Monkevicius and U.S. Ambassador Tefft signed an agreement in Vilnius on 3 October between the ministry and the U.S. National Oceanic and Atmospheric Administration that would allow Lithuania to participate in the international program GLOBE (Global Learning and Observations to Benefit Environment), ELTA reported. Lithuania became the 100th nation to accede to the GLOBE program, which involves over 1 million students enrolled in more than 12,000 elementary, basic, and secondary schools worldwide.

* The parliament on 1 October passed by votes of 104 to one with eight abstentions and 103 to two with seven abstentions amendments to articles 48 and 118, respectively, of Lithuania's Constitution which add the provisions of existing laws on the appointment of the prosecutor general and the functions of prosecutor's office to the constitution, BNS reported. The amendments will go into effect only after at least two-thirds of the parliament approves them again after an interval of at least three months.

* Liberal Union Chairman Gentvilas told a press conference on 2 October that his party is planning to suggest amendments to the constitution which would end the drafting of youths to serve in the armed forces and lead to an all volunteer army, BNS reported. He noted that NATO Secretary-General George Robertson has urged NATO member and candidate countries to create professional armies. Gentvilas also said that one year is too brief a period for recruits to gain all necessary training. The country's armed forces now have about 13,000 servicemen of whom about 5,000 are draftees.

* Bank of Lithuania head Reinoldijus Sarkinas told a press conference in Vilnius on 2 October that during a recent visit to Washington along with Finance Minister Dalia Grybauskaite he had meetings with IMF European Department II Director John Odling-Smee and acting head of IMF mission in Lithuania Mohammad Shadman-Valavi, ELTA reported. He said that Lithuania will fulfill its commitments to the IMF this year. Sarkinas also repeated his earlier forecasts that in 2002 GDP would grow by 5.5-6 percent and the current account deficit would be 5-6 percent of GDP.

* Prime Minister Brazauskas formed on 2 October a working group, headed by Deputy Transportation and Communications Minister Valerijus Ponomariovas, to analyze the possibilities of transporting rocket fuel from the Kaliningrad Oblast to mainland Russia via Lithuania, BNS reported. The formation of such a group had been decided at a meeting in July of the defense ministers of the countries. Russia would want to ship 1,600 tons of the fuel through Lithuania by train.

* The first reactor of the Ignalina nuclear power plant resumed operation on 30 September after regular repairs which had begun on 21 June, BNS reported. The plant, however, did not use its greater production capacity for long because the second reactor was shut down the next day when a crack was found in one of its pipes. Radiation levels remained unchanged, but the repairs of the pipe are expected to last until 7 October.

* The head of the State Border Guard Service Algimantas Songaila said on 30 September that the Lazdijai border station, which had been in charge of the Lithuanian-Polish border, would change its work scope from 1 October by taking over the stations at Kapciamiestis (with Belarus) and Girenai (with Russia), ELTA reported. This is part of the program which will simplify border regulations with Poland (a future EU internal border) while tightening the borders with Belarus and Russia, which will be EU external borders.

* The Bank of Lithuania announced on 30 September that the country's current account deficit in the first half of the year was 1.5 billion litas ($430 million) in the first half of 2002, or 45 percent greater than in the same period last year, BNS reported. This was primarily due to a 25.5 percent increase in the country's foreign trade deficit. The current account deficit represented 6.3 percent of the country's gross domestic product.

* The Statistics Department announced on 30 September that foreign direct investments (FDI) grew by 13.2 percent over the first half of 2002 and totaled 12.07 billion litas ($3.45 billion), BNS reported. The per capita FDI amounted to 3,478 litas.

* SIC Gallup Media announced on 30 September the results of a survey which indicated that some 21 percent of the population used the Internet at least once in the period June-August 2002 while only 11 percent had done so in the same period last year, BNS reported. The 2002 use is greater than the 16 percent among Latvians, but lower than the 39 percent among Estonians.