UNCLAS VILNIUS 000180
PLEASE PASS TO H FOR CODEL BERKLEY FROM AMBASSADOR JOHN
E.O. 12958: N/A
TAGS: PREL PGOV ECON ENRG OREP LH
SUBJECT: LITHUANIA: SCENESETTER FOR VISIT OF CODEL BERKLEY
REF: STATE 27301
Â¶1. Welcome to Lithuania! We look forward to your visit,
which coincides with a number of local celebrations. This
year marks the fifth anniversary of Lithuania's membership in
NATO. Lithuania is also celebrating the 1,000-year
anniversary of the first reference to the country in
historical texts, and Vilnius is one of Europe's 2009
Capitals of Culture. The United States and Lithuania enjoy a
friendly and productive bilateral relationship based on a
century of immigration, as well as our non-recognition of the
forcible incorporation of Lithuania into the Soviet Union.
Lithuania was delighted to join the Visa Waiver Program late
last year, allowing easier travel to the United States.
Lithuania has been a staunch U.S. partner, sending troops to
Kosovo and Afghanistan. The Government of Lithuania (GOL)
and all mainstream political parties value the friendship
with the United States, as evidenced by the fact that you
will meet with the President, the Prime Minister, the
parliamentary Speaker and the leader of the opposition.
Preview of Your Visit
Â¶2. I look forward to greeting your delegation upon arrival
at the Vilnius airport on Wednesday and you will also meet
with President Valdas Adamkus that afternoon. On Thursday,
you will meet Seimas Speaker Arunas Valinskas, opposition
leaders in the Seimas, and Prime Minister Andrius Kubilius.
You will have lunch Thursday with Belarusian opposition
leaders and Embassy Minsk Charge d'Affaires Jonathan Moore.
At other meetings you will have the opportunity to discuss
economic and energy topics, Russia relations and Jewish
issues with a variety of experts from government, business
and academia. Another issue the Embassy has worked hard to
resolve, but so far unsuccessfully, is the hardship on
American families caused by a restrictive Lithuanian
Relations with Russia
Â¶3. Lithuanian-Russian relations are complicated, and
historically have been characterized by occupation and
repression. In the last century, the Russian Empire and the
Soviet Union occupied Lithuania from 1900-1918, 1940-1941 and
then again from 1944-1991. In 1990, Lithuania became the
first republic to proclaim independence from the Soviet
Union. Today Lithuania's relations with Russia remain
strained. Even average Lithuanians were concerned about
Russian aggression in Georgia last August, but there are
clearly mixed feelings about whether the best path is to
engage Russia or try to isolate it.
Â¶4. In the economic field, Lithuania is fully dependent on
Russia for its natural gas supply and largely dependent on
Russia for oil imports. Looking ahead, Lithuania's Ignalina
Nuclear Power Plant (a Chernobyl-style Soviet-era facility)
will close on December 31, 2009, under the terms of its EU
accession agreement. Lithuania presently has no replacement
ready and has no option to replace this electrical power
other than increased reliance on Russian resources.
Lithuania is uncomfortable with Russia maintaining so much
leverage but developing alternative energy sources will take
time. Russia is also Lithuania's largest trading partner.
Â¶5. Lithuania has a small (five percent) Russian minority,
which plays no significant role in domestic politics. When
Lithuania regained its independence, ethnic Russians living
here were able to apply for Lithuanian citizenship, which has
allowed Lithuania to avoid ethnic tensions that have troubled
the other Baltic states.
Â¶6. Some in Lithuania may be ready to tentatively hit the
restart button together with allies. The Lithuanian Foreign
Ministry has signaled an increased willingness to engage
Russia on border, cultural and diplomatic initiatives.
Â¶7. Lithuania and Belarus share a relatively long (679-km)
border and much history. As a result, the GOL focuses much
attention on pulling Belarus toward the West and democracy.
Lithuania strongly supports Belarusian participation in the
EU's Eastern Partnership initiative, which is set to launch
in May of this year.
Â¶8. In addition to engaging the Government of Belarus
directly, the GOL supports organizations that have been
shunned by the Lukashenka regime. The European Humanities
University (EHU) was closed by Belarusian authorities in
2004, but re-launched its activities in Vilnius in 2005 and
has been operating in exile ever since. There are also a
number of NGOs working out of Vilnius on Belarusian
human-rights issues including the International Republican
Institute, the Human Rights House and the Eastern European
Studies Center. The GOL also supports an annual rock concert
"B2Gether" on the Lithuanian-Belarusian border to promote
friendship and freedom.
Â¶9. Lithuania has struggled to deal with the effects of the
Holocaust and the involvement of Lithuanians in it. This
embassy has been deeply engaged with the GOL to push for the
restitution of Jewish communal property and for the
protection of a historic Jewish cemetery in the Snipiskes
neighborhood of Vilnius. Congress passed concurrent
resolutions critical of the GOL on both of these topics last
year. Lithuania also has appeared more zealous in efforts to
investigate Jewish WWII partisans who fought alongside Soviet
troops than Nazi collaborators, and some politicians clearly
consider the Soviets a greater historical evil than the
Â¶10. Lithuania is one of the few countries in Europe that has
not resolved the issue of communal Jewish property
confiscated by Nazi or Soviet occupation forces. For years,
successive governments have promised -- and failed -- to
introduce restitution legislation in the Seimas (parliament).
The current government has published draft legislation, but
Jewish leaders say they were not consulted before the
government unveiled the latest proposal. It calls for
monetary compensation for the stolen properties, but how the
valuation of these properties was determined is unclear.
Â¶11. The historic Jewish cemetery in the Snipiskes area of
Vilnius was the main burial ground for Vilnius's large Jewish
community for several centuries. It was largely destroyed by
the Soviets, who removed headstones and used them in other
construction projects, although many graves remain in place.
In 2006-2007, the GOL allowed the construction of
office/apartment buildings in one corner of the site, despite
significant evidence that they likely were partially inside
the cemetery's boundaries. We have urged the government to
work with Jewish groups to protect and appropriately
memorialize the cemetery site in its entirety.
Â¶12. Although the Justice Department's Office of Special
Investigations (OSI) has provided the GOL with extensive
files of evidence on Lithuanian-born Nazi collaborators, few
have been prosecuted here and none has been imprisoned. Yet
the Prosecutor General's office last year actively pursued
investigation of several elderly Jews, who had been anti-Nazi
partisans, about mass killings of Lithuanians allegedly
committed by fighters allied with Soviet troops during World
War II. Although the GOL dropped the case against the most
well-knowm of these partisans, General Arad, the prosecutor
continues to want to interview others as potential witnesses.
Â¶13. After years of strong growth, the economy has reversed
course. Unemployment levels have increased from 3 percent in
September 2008 to 8.2 percent in March 2009.
Â¶14. As revenues decline, the government's budget deficit is
growing, despite earlier budget cuts and tax increases. The
GOL slashed spending by approximately 15 percent at the
beginning of this year, and is now seeking approximately 1
billion dollars of additional cuts -- about 11 percent of the
original budget. The Finance Ministry now anticipates
negative growth of 10.5 percent this year. The prime minister
recently said that the GOL would consider laying off 4,000
public-sector employees, approximately 20 percent of total
Â¶15. External borrowing, already a challenge, should become
more difficult following Standard and Poor's recent lowering
of Lithuania,s sovereign credit rating to BBB/A-3 from BBB
Â¶16. The United States ranks 11th in Foreign Direct
Investment (FDI) in Lithuania. U.S. direct investment stands
at $347.5 million, or 2.5 percent of total FDI, trailing well
behind neighboring and other European countries. At the
corporate level, though, three of the six largest foreign
investors in Lithuania are American firms: Philip Morris,
Kraft and Mars.
Residency for Americans
Â¶17. In November 2006, the Parliament amended the law on the
legal status of foreigners so that it requires foreign
workers from non-EU countries to live in Lithuania for two
years before their family members can receive residency
permits and join them. The change has caused hardship for
the private American community in Lithuania including the
families of teachers, Fulbright Scholars, businesspeople,
military-exchange participants, and basketball players
working in Lithuania. The law now creates a disincentive for
a variety of professionals to work in Lithuania and limits
the potential for Americans and others to share their
cultural and business talents with Lithuania. Despite our
intense attention to this problem, there has not yet been an
amendment proposed that would resolve it.
Â¶18. All of us at Embassy Vilnius very much look forward to
seeing you in Lithuania April 15-17, and wish you safe