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LITHUANIA Republic of Lithuania

Lietuvos RespublikaLietuv os Respublika

CAPITAL: Vilnius FLAG: Three equal horizontal bands of yellow (top), green, and red. AN- THEM: Tautiška Giesme (The National Song) MONETARY UNIT: The euro replaced the Lithuanian lita (LTL) as the official currency on 1 January 2015. The euro is divided into 100 cents. There are coins in denominations of 1, 2, 5, 10, 20, and 50 cents and 1 euro and 2 euros. There are notes of 5, 10, 20, 50, 100, 200, and 500 euros. €1 = $1.1137 ($1 = €0.897717) as of August 2016. WEIGHTS AND MEASURES: The metric system is in force. HOLIDAYS: New Year’s Day, 1 January; Independence Day, 16 February; Restoration of Lithuanian Statehood, 11 March; Statehood Day of Lithuania, 6 July; National Day of Hope and Mourning (All Soul’s Day), 1 November; Christmas, 25–26 December. Movable holidays include Easter and Mother’s Day. TIME: 2 p.m. = noon GMT

1 LOCATION, SIZE, AND EXTENT

Lithuania is located in eastern Europe between Latvia and Poland, bordering the Baltic Sea. Comparatively, it is slightly larger than the state of West Virginia, with a total area of 65,200 sq km (25,174 sq mi). Lithuania shares boundaries with Latvia on the N and NE, Belarus on the S and SE, Poland on the SW, Russia-Kaliningrad Oblast on the W, and the Baltic Sea on the NW. Lithuania’s land boundary length totals 1,639 km (1,018 mi). Its coastline is 90 km (56 mi).

Lithuania’s capital city, Vilnius, is located in the southeast- ern part of the country.

2 TOPOGRAPHY

The topography of Lithuania features a central lowland terrain with many scattered small lakes and fertile soil. Moderate highlands lie to the east and south, with a few hilly regions in the west. The main hill regions are the Zemaical Uplands of the northwest and the Baltic Highlands of the southeast. The high- est point in the country is Aukstojas, located in the Medininkai Highlands. It has an elevation of 294 m (965 ft). The lowest point is at sea level (Baltic Sea).

There are about 758 rivers in the country that are longer than 10 km (6.2 mi), but very few are navigable. The Neman, which cuts through the center of the country from Belarus to the Baltic Sea, is the longest river, with a length of 936 km (582 mi). There are more than 3,000 lakes in the country, most of which are in the eastern central regions. The largest is Lake Druksiai, which is located on the northeastern border with Belarus and covers an area of 44.5 sq km (17.2 sq mi).

3 CLIMATE

Lithuania’s climate is transitional between maritime and continental, which means it has wet, moderate winters and summers. January temperatures average -5ºC (23ºF); the mean temperature in July is 18°C (64.4°F). Rainfall averages from 49 cm (19 in) to 85 cm (33 in) depending on location.

4 FLORA AND FAUNA

Lithuania is located in the mixed forest zone. The country’s vegetation is a mixture of coniferous, broadleaf woodlands, arctic, and steppe species. The country has rabbit, fox, red deer, roe deer, elk, wild boar, badger, raccoon dog, wolf, lynx, and gallinaceous birds. Roach, ruff, bream, and perch can be found in Lithuania’s lakes and streams.

The International Union for Conservation of Nature (IUCN) estimated that there are 264 vascular plant species in Lithuania. In addition, it is home to 63 species of mammals, 376 species of birds, 7 species of reptiles, and 11 species of amphibians. The calculation reflects the total number of distinct species residing in the country, not the number of endemic species.

According to a 2015 IUCN report, threatened species include 2 types of mammals, 9 species of birds, 6 species of fish, 2 species of mollusk, 5 species of invertebrates, and 2 species of plants. Examples are the European eel and thick-shelled river mussel. The wild horse (Przewalski’s horse) has become extinct in the wild in Lithuania.

5 ENVIRONMENT

The nation’s environmental problems include air pollution, water pollution, soil contamination, and the threat of nuclear contamination. The World Resources Institute reported that, in 2012, carbon dioxide emissions totaled 13.7 million tons. In 2014, water resources totaled 24.5 cu km (5.9 cu mi), according to the UN. According to the CIA, water usage was 2.4 cu km (0.6 cu mi) per year in 2009, the most recent year for which data was available. Per capita water usage totaled 703.8 cu m (24,854 cu ft) per year. Domestic water usage accounted for 7% of total usage, industrial for 90%, and agricultural for 3%. Water pollution results from uncontrolled dumping by industries and the lack of adequate sewage treatment facilities.

According to the World Database of Protected Areas (WDPA), Lithuania had designated a total of 860 areas for protection as of 2014, including 10,864 sq km (4,195 sq mi) of land and 682 sq km (263 sq mi) of marine area. Lithuania also has seven Ramsar Wetland Sites of international importance.

WORLDMARK ENCYCLOPEDIA OF THE NATIONS, 14TH EDITION 445

Since the 1986 nuclear accident at Chernobyl in nearby Ukraine, which contaminated much of Lithuania with excessive radiation, Lithuanians have been concerned about nuclear energy development, especially the use of nuclear power generated by plants similar to the one at Chernobyl.

Lithuania’s pollution problems have also affected the nation’s wildlife. Many of the country’s original animal and plant species are now extinct.

6 POPULATION

The US Central Intelligence Agency (CIA) estimated the popula- tion of Lithuania in July 2015 to be approximately 2,884,433,

which placed it at number 140 in population among 238 countries, dependencies, and territories of the world. In 2015, approximately 19.2% of the population was over 65 years of age, with another 14.9% under 15 years of age. The median age in Lithuania was 43.1 years. There were 0.9 males for every female in the country. The population growth rate was -1.0%. The projected population for the year 2025 is 2,725,000. In 2014, the population density was calculated at 47 people per sq km (121.8 per sq mi).

The CIA estimated that 66.5% of the population lived in urban areas in 2015; urban populations had a population growth rate of -0.5% between 2010 and 2015. The largest urban area is Vilnius, with a population of 517,000 as of 2015.

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R U S S I A

P O L A N D

L A T V I A

B E L A R U S

Lithuania

LITHUANIA 40 Miles0

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LOCATION: 56°N; 24°E. LAND BOUNDARIES: Total: 1,549 kilometers (963 miles); Latvia, 544 kilometers (338 miles); Belarus, 640 kilometers (398 miles); Poland, 104 kilometers (65 miles); Russia, 261 kilometers (162 miles); Coastline, 90 kilometers (56 miles). TERRITORIAL SEA LIMIT: 12 nautical miles.

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446 VOLUME 5: EUROPE

Since the fall of Communism, the population of Lithuania has declined by one-fifth. The decline is attributed to high rates of emigration after Lithuania joined the European Union (EU) in 2004 and a rapidly falling birth rate since 1990.

7 MIGRATION

Estimates of Lithuania’s net migration rate, carried out by the CIA in 2015, amounted to -6.3 migrants per 1,000 citizens. Ac- cording to the Migration Policy Institute’s mid-2013 estimates, the total number of emigrants living abroad was 570,000, and the total number of immigrants living in Lithuania was 148,000. Many Lithuanians were deported to Siberia during the Soviet occupation in 1940. Russian immigration to Lithuania has never been as heavy compared to the other Baltic republics. Lithuania has been used as a transit country to western Europe for many years. Government policy was to return asylum seekers to their homelands or detain them indefinitely, until the Lithuanian Refugee Law, passed on 27 July 1997, established an asylum procedure. The United Nations High Commissioner for Refugees (UNHCR) reported 1,055 refugees and 54 asylum seekers residing in Lithuania as of June 2015.

8 ETHNIC GROUPS

According to 2011 CIA estimates, Lithuanians accounted for about 84.1% of the population. Poles made up 6.6%, followed by Russians at 5.8% and Belarusians at 1.2%. The remaining minority ethnic groups included Ukrainians, Tatars, Karaites, Germans, and others. There were about 3,000 in the Romani community.

9 LANGUAGES

Lithuanian, the official language, is noted for its purity in retain- ing ancient Indo-European language forms. It has some remark- able similarities with Sanskrit. It is highly inflected, with seven noun cases. Like Latvian, it has rising, falling, and short intonations. Its Roman alphabet has many special symbols, including the hacek, dot, and cedilla. According to the CIA, as of 2011, the majority of Lithuanians (82.0%) spoke Lithuanian. Polish (5.6%) and Russian (8.0%) were also widely used. Minorities have the right to official use of their languages where they form a substantial part of the population.

10 RELIGIONS The country witnessed extensive suppression of religious activi- ties during the Nazi and Soviet periods, but the number of religiously active citizens seems to have increased since then. Ac- cording to the 2011 census, 77.3% of respondents were nominally Roman Catholic. The next largest denomination, the Russian Orthodox Church, accounted for about 4.1% of the population. About 0.8% of the people were Old Believers (an Orthodox sect), 0.6% were Lutherans, 0.2% were Evangelical Reformed, and 0.1% were Sunni Muslim; less than 0.1% were Jewish and Greek Catholic.

Lithuania is one of a few countries to have an active com- munity of Karaites. Karaism is a branch of Judaism with tenets based exclusively on a literal interpretation of the Hebrew scriptures. According to a 2014 US Department of State report, the Karaites live in Vilnius and Trakia, with a total of about 290 members. The Karaites are also considered an ethnic community.

They speak a Turkic-based language and use the Hebrew alphabet. Other groups that are referred to as “nontraditional” by the government include Full Gospel Word of Faith Move- ment, Pentecostals/Charismatics, Jehovah’s Witnesses, Baptists, Seventh-day Adventists, the Church of Jesus Christ of Latter- day Saints (Mormons), and the New Apostolic Church.

The constitution allows for freedom of religion, and this right is generally respected in practice, but the government reserves the right to place restrictions on religious organizations with practices that might contradict the constitution or public law. According to a 2014 US Department of State report, the government recognizes nine groups as “traditional” faiths that have existed in Lithuania at least 300 years: Latin Rite Catholics, Greek Rite Catholics, Evangelical Lutherans, the Evangelical Reformed Church, Russian Orthodox, Old Believers, Jews, Sunni Muslims, and Karaites. These religions are eligible for state assistance and are accorded a number of rights, such as legal registration of marriages and the right to provide religious instruction in public schools. “Nontraditional” religious com- munities may apply for state recognition, which allows them to receive some funding from the government for various social or cultural programs. As of 2014, there were 186 registered nontraditional religious associations, centers, and communities; only 2—the Evangelical Baptist Union of Lithuania and the Seventh-day Adventists—were recognized by the state.

There have been some reports of anti-Semitism within the country, primarily in the form of vandalism against property and anti-Semitic comments made in the media (primarily on the Internet).

11 TRANSPORTATION

In 2012, the CIA reported that Lithuania had a total of 84,166 km (52,298 mi) of roads, 72,297 km (44,923 mi) of which were paved. There were 615 vehicles per 1,000 people in the country in 2011. In 2014, Lithuania’s railroads extended for 1,768 km (1,099 mi). The railroad system provides access to the Baltic Sea for Vilnius, Kaunas, and other major urban areas. Broad-gauge lines accounted for most of the system, totaling 1,746 km (1,085 mi), 22 km (13.7 mi) of which were electrified. Narrow gauge accounted for another 159 km (98.8 mi), with standard gauge accounting for the remainder.

According to the CIA, as of 2007, Lithuania has ap- proximately 441 km (274 mi) of navigable waterways. As of 2016, Klaipėda, on the Baltic Sea, was the biggest and most important Lithuanian transport hub, linking sea, land, and railway routes. Kaunas was the principal inland port. In 2010, the merchant fleet consisted of 38 ships over 1,000 gross registered tons. A railway sea ferry runs from Klaipėda to Mukran, Germany. As of 2013, there were 61 airports, 22 of which had paved runways. In 2014, those airports transported a combined 217,767 passengers, according to the World Bank. Principal airports include Palanga, Vilnius, and Kaunas International at Kaunas. There is one commercial airport in Siauliai. Lithuania is served by several international airlines, including Lithuanian Airlines, Lietuva, Ryanair, and Easyjet.

12 HISTORY

Lithuanians are a branch of the Balts, whose permanent and lasting settlement of modern-day Lithuania dates back to 200 BCE, much earlier than most of Europe, whose people and

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cultures were still in flux well into the 5th century CE. Lithu- anian, along with Latvian, is one of the oldest languages in Europe.

The first Lithuanian state was established by the grand duke and later king Mindaugas in 1236. Grand Duke Gedimi- nas, who ruled from 1316 to 1341, is credited with founding the capital of Vilnius and the Jagiełłon dynasty, whose members would become figures of power in Lithuania, Poland, and Hungary for the next 200 years.

In the late 14th century, Lithuania ruled a vast area cover- ing much of modern-day Belarus and Ukraine and stretching to the Black Sea. However, the country was constantly threatened by the German Teutonic Order, which occupied the southern Baltic coast. The power struggle had a religious element; outside of an eight-year period, Lithuania remained devoutly pagan until 1386. That year, Grand Duke Jagiełło wed the Polish queen Jadwiga and thereby converted to Christianity the last remaining European pagans. The combined Polish-Lithuanian armies led by Jagiełło and his cousin Vytautas decisively beat the Teutonic Knights at the Battle of Grunwald in 1410.

The marriage of Jagiełło to Jadwiga and Jagiełło’s ascension to the Polish throne marked the beginning of a political union with Poland, intertwining the histories of the two nations for 400 years. The union was made formal in the 1569 Lublin agreement, which created the Polish-Lithuanian Commonwealth with an elected monarch chosen by the gentry of both states. Although in principle it was a union of two equals, the Polish influence on the culture and politics of the commonwealth was stronger because of the larger size and population of the Polish state, among other factors. Lithuania prospered and developed during the commonwealth’s golden age in the 16th century with the founding of the region’s first university in Vilnius in 1579 and the development of a distinct Lithuanian Baroque artistic style.

The 18th century saw the decline of the commonwealth and occupation by foreign powers. What is now Lithuania was annexed to the Russian Empire in the final partition in 1795. During the 19th century, a Lithuanian nationalist movement arose, leading to uprisings against Russian rule and, in turn, to Russian persecutions such as the outlawing of the Lithuanian language.

On 16 February 1918, Lithuania proclaimed its indepen- dence after the defeat of both Germany and Russia in World War I. The new Bolshevik government in Moscow attempted to establish Soviet power in Lithuania but failed. After a series of armed border conflicts between Lithuania, Russia, and Poland, Moscow recognized Lithuanian independence in 1920. But when Poland annexed Vilnius, the Lithuanian capital had to be moved to Kaunas. A secret protocol to the 1939 Nazi-Soviet pact assigned Lithuania to the Soviet sphere of influence. Wish- ing to avoid conflict, the Lithuanian government allowed Soviet forces to be stationed on its territory. The local government was forced to resign in June 1940. Rigged elections created a parlia- ment that proclaimed Lithuania a Soviet socialist republic in July 1940. Moscow lost control of Lithuania soon after Germany attacked the Union of Soviet Socialist Republics (USSR) in June 1941.

Lithuania suffered heavily at the hands of both powers. While the Nazis succeeded in exterminating most of Lithuania’s 240,000 Jews, the Soviets deported tens of thousands of Lithu- anians to Siberia. Soviet forces recaptured Lithuania in 1944,

although armed resistance against Soviet rule continued for several years after World War II.

Forty-five years of Soviet occupation did not erase the Lithuanian national identity. The first open protests against Soviet rule occurred in 1987 and 1988. Vytautas Landsbergis established the Sǫjūdis anti-Communist political reform move- ment, which strove to create an autonomous republic and later an independent state. With the crumbling of the Eastern bloc and fall of the Berlin Wall in 1989, Soviet pressure eased, and opposition parties were allowed to participate in elections to the Lithuanian Supreme Soviet held on 24 February 1990. Sǫjūdis won a clear majority, and Lithuania became the first Soviet republic to proclaim independence on 11 March 1990.

Although Soviet president Mikhail Gorbachev’s policy of glasnost and perestroika had intended to allow a greater voice to Lithuanian self-determination, full Lithuanian independence from the Soviet Union was not what many in the Kremlin had in mind. The August 1991 coup by hardliners in Moscow was accompanied by a crackdown in Vilnius, with Soviet troops storming the TV Tower, killing 14 civilians and injuring 700. It was not until the failure of the coup and collapse of the Soviet Union that the government in Moscow fully recognized Lithu- anian independence.

Since independence, Lithuania has been preoccupied with reforming its economic and political institutions. Privatization has transformed its economy to a market-oriented one. Politi- cally, a thriving press and open democracy have been established. Former Communists won the first postindependence elections in 1992, but conservatives took back the Seimas (parliament) in the 1996 elections in response to growing allegations of govern- ment corruption. Presidential elections the following year were surrounded by controversy over the eligibility for office of candidate Valdas Adamkus, who had lived in the United States for over 30 years following World War II. Adamkus was elected in runoff elections in January 1998.

Parliamentary elections were held on 8 October 2000, resulting in a win for former president Algirdas Brazauskas’s Social Democratic Coalition, which won 31.1% of the vote, taking 51 of 141 seats in the Seimas. However, a grouping of four smaller parties formed a new centrist government, with Ro- landas Paksas as prime minister. Presidential elections were held on 22 December 2002, and Adamkus took the lead in the first round of voting, with 35.3% of the vote to Paksas’s 19.7%. Paksas campaigned vigorously for the runoff vote held on 5 January 2003 and surprised many experts by winning the second round with 54.9% to Adamkus’s 45.1%.

Paksas was impeached in April 2004 for having ties with Russian organized crime and participating in influence peddling, and the country was temporarily thrown into disarray. In the early election that followed, the constitutional court did not al- low Paksas to run again despite his continued popularity, especially in rural regions. Adamkus seized the opportunity to return to office and beat Kazimira Prunskiene, the country’s first post-Soviet prime minister, who was supported by those loyal to Paksas.

Given the history of Russian domination of Lithuania, it is understandable that Lithuania’s primary foreign policy objective has been to improve relations with the West and especially to gain entrance into the North Atlantic Treaty Organization (NATO) and the EU. Lithuania became a member of both organizations in 2004.

Lithuania

448 VOLUME 5: EUROPE

On 12 July 2009, Dalia Grybauskaite was inaugurated as the first female president of Lithuania. Before her election, she served as the EU budget commissioner. While concern for the lagging economy was a prominent issue during the election, the president of Lithuania is primarily responsible for foreign affairs and has little oversight of economic policy. Grybauskaite’s foreign policy reputation would prove crucial to winning a second term. Often referred to in Lithuania as the “Iron Lady” in homage to former British prime minister Margaret Thatcher, one of her political role models, Grybauskaite won the 2014 presidential election amid rising concern about Russian expansionism. She defeated Zigmantas Balčytis in the second round of voting, winning 59.1% of the popular vote and becom- ing the first Lithuanian president to be elected to consecutive terms.

Tensions with Russia had been mounting even before Rus- sia’s annexation of Crimea in 2014. In October 2013, Russia stopped importing dairy products from Lithuania, which many interpreted as a protest of Lithuanian efforts to establish closer ties between the EU and Ukraine and other former Soviet republics. After Russia annexed Crimea in early 2014, NATO bolstered its military presence in several Baltic countries, includ- ing Lithuania. In response to growing concern about Russia’s expansionist ambition, Lithuania announced in February 2015 it would restart military conscription for the first time since 2008.

13 GOVERNMENT

On 25 October 1992, Lithuanian voters approved a new constitution, which called for a 141-member unicameral parlia- ment (Seimas) and a popularly elected president. The constitu- tion requires the president to sever formal party ties. All permanent residents of Lithuania in November 1989 are granted the opportunity to become citizens, irrespective of their ethnic origins. Members of the Seimas are elected for four-year terms, and the president is directly elected for a five-year term. The prime minister is appointed by the president; all other ministers are nominated by the prime minister and appointed by the president. All ministerial appointments must be approved by the Seimas. Suffrage is universal at age 18.

14 POLITICAL PARTIES

Major political parties in Lithuania include the Electoral Action of Lithuanian Poles (LLRA), the Homeland Union–Lithuanian Christian Democrats (TS–LKD), the Labor Party (DP), the Liberal Movement (LRLS or LS), the Lithuanian Green Party (LZP), the Lithuanian Social Democratic Party (LSDP), the Order and Justice Party (TT), the Peasant and Greens Union (LVZS), and Way of Courage (DK).

The majority party in the Seimas after the 1996 parliamen- tary elections was the conservative Homeland Union (TS), led by Landsbergis, which won 70 out of 141 seats. Overall, 28 par- ties competed for the 141 parliamentary seats in elections held on 20 October 1996 (first round) and 10 November 1996 (second round). The other right-wing party, the Christian Democrats (LKD), also did well, winning 16 seats, and entered into a coalition government with the TS and the Lithuanian Center Union, which won 13 seats. The Democratic Labor Party (composed mostly of ex-Communists), which had been the majority party in the previous parliament, won only 12

seats. Other parties with parliamentary representation included the LSDP and the Lithuanian Democratic Party.

The Homeland Union–Conservative coalition suffered in the October 2000 parliamentary elections, capturing only 9 seats. Former president Brazauskas led four leftist parties in the Social Democratic coalition, winning 51 of the 141 seats in parliament. However, the New Policy coalition—composed of the ideologically diverse Liberal Union (33 seats), New Alliance (28), Center Union (2), Modern Christian Democratic Union (3), and two smaller parties—formed a new government, bypass- ing the Social Democratic coalition. Paksas was named prime minister.

In the elections of October 2004, the DP—a political formation led by Russian millionaire Voktor Uspaskich—won 39 seats. The TS won 25 seats; Social Democrats, 20; Liberal and Center Union, 18; Social Liberals, 11; Union of Farmers and New Democracy, 10; Liberal Democrats, 10; LLRA, 2; and independents, 6. In the presidential elections held in June 2004, Adamkus beat Prunskiene with 52.2% of the vote.

Following the 2008 parliamentary elections, the TS–LKD, LRLS, Liberal and Center Union (LCS), and National Revival (TPP) formed a ruling coalition. Together these parties controlled 71 seats in parliament. The LSDP won 25 seats, fol- lowed by TT with 18 seats, the Christian Party with 10 seats, and DP with 10 seats. There were 7 unaffiliated seats, and 1 seat was left vacant. Andrius Kubilius of TS–LKD was appointed as prime minister.

On 12 July 2009, Grybauskaite was inaugurated as the first female president of Lithuania. Running as an independent candidate, she won the May 2009 presidential election with 69% of the vote. Social Democrat Algirdas Butkevicius came in second with 12% of the vote.

On 14 October 2012, Lithuania held parliamentary elec- tions, with about 51% of registered voters coming out to vote. DP won the largest share of the popular vote with 20.7% but only gained 29 seats, the third most of any party. With 19.1% of the vote, LSDP managed to secure 38 seats, while TS–LKD won 33 seats with 15.7% of the popular vote. TT won 11 seats with 7.6% of the vote, and LRLS won 10 seats with 9% of the vote. DK had 8.3% of the vote and 7 seats, LLRA won 6.1% and 8 seats, and the LVZS won 1 seat with 4.1% of the vote.

15 LOCAL GOVERNMENT For administrative purposes, Lithuania’s 10 counties, called apskritys, are subdivided into 60 municipalities, either districts or cities. Each level of local government has its own elected officials.

16 JUDICIAL SYSTEM After Lithuania broke away from the Soviet Union, its legal system was transformed from that of the old Soviet regime to a democratic model. The system consists of a Constitutional Court and a Supreme Court, whose judges are elected by the Seimas. There are also district and local courts, whose judges are ap- pointed by the president. A court of appeals hears appellate cases from the district courts. A new civil and criminal procedure code and a court reform law were enacted in 1995. The govern- ment has reviewed its laws to bring them into accord with the European Convention on Human Rights. The judiciary is independent.

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17 ARMED FORCES

The International Institute for Strategic Studies reported that active armed forces in Lithuania totaled 10,950 members in 2014. The force comprised 7,500 members of the army, 500 members of the navy, 900 members of the air force, and 2,050 members of joint forces. There were 11,000 members of the paramilitary. In 2013, armed forces represented 1.4% of the labor force in Lithuania. Defense spending totaled $377 million and accounted for 2.7% of gross domestic product (GDP).

As of 2014, Lithuanian forces had served in Afghanistan, the Central African Republic, Mali, the North Sea, Serbia, and Ukraine. Lithuania began focusing on cyber security in the early 21st century, adopting a cyber security strategy in 2013 and implementing a cyber security law in 2015. That year, Lithuania became the first country to help arm Ukraine against Russian incursions into Ukrainian territory.

18 INTERNATIONAL COOPERATION

Lithuania was admitted to the United Nations (UN) on 17 September 1991. It is a member of several specialized agencies, such as the FAO, IAEA, World Bank, ILO, IMF, UNCTAD, UNESCO, UNIDO, and WHO. Lithuania is also a member of the World Trade Organization (WTO), the Organization for Security and Co-operation in Europe (OSCE), the Council of Europe, the European Bank for Reconstruction and Develop- ment, the Euro-Atlantic Partnership Council, and the Council of the Baltic Sea States. It is a member affiliate of the Western European Union. Lithuania joined the EU and NATO in 2004.

As of early 2016, Lithuania had 99 foreign embassies and consulates. The country has offered support to UN missions and operations in Kosovo (est. 1999). It is part of the Australia Group, the Nuclear Suppliers Group (London Group), and the Organization for the Prohibition of Chemical Weapons. In environmental cooperation, Lithuania is part of the Basel Convention, Conventions on Biological Diversity and Air Pollu- tion, Ramsar, CITES, the Kyoto Protocol, the Montréal Protocol, MARPOL, and the UN Conventions on the Law of the Sea and Climate Change.

19 ECONOMY

Due to the modernization that occurred during Soviet dominance, Lithuania built up a large, if somewhat inefficient, industrial sector. In 2015, industry accounted for 30.7% of the country’s economy. The service sector accounted for 65.8%, and agriculture accounted for about 3.5%.

In 1992, Lithuania’s GDP fell 21.6%. That year, the government adopted an International Monetary Fund (IMF) program aimed at privatizing the economy, controlling inflation, eliminating price controls, and lowering the budget deficit. In June 1993, Lithuania’s convertible currency, the lita, was introduced, setting off another round of inflation, while GDP continued to decline. In 1994, the government entered into a three-year arrangement with the IMF under its Extended Fund Facility (EFF) aimed primarily at bringing inflation under control. The first year of positive growth (3.3%) since independence was 1995, although unemployment remained high, at 16.4%. The economy registered real growth until 1999 but was overtaken by the effects of the August 1998 financial crisis in Russia, one of Lithuania’s largest trading partners.

Growth returned in 2000, with real GDP up 3.3%, but unemployment continued to soar, peaking at 13.2% in March 2001. In February 2002, the government repegged the lita to the euro, instead of the US dollar, at a rate of LTL3.4528 per euro. The unemployment rate decreased and stood at just 3.2% in 2007. Between independence and 2008, about 80% of Lithu- ania’s enterprises were privatized, and more than 25% of its trade was with countries outside the old Soviet bloc. Lithuania was admitted to the WTO in 2001 and to the EU in 2004.

The Lithuanian economy was hit hard by the global financial crisis of 2008–09. Decreased demand for exported goods led to a decrease in industrial output. Demand also dropped in construction, textiles, and retail industries, resulting in Lithuania’s largest contraction in GDP since 1995. The government projected a decline in GDP of 15.0% by the end of 2009. Those projections materialized in January 2010. In that month, Statistics Lithuania reported that the 2009 drop in GDP was 15.0%, marking the worst economic year since the country gained independence in 1990. A more detailed look at the statistics, however, left room for hope. The 2009 quarterly contractions moved from 19.5% in the second to 14.2% in the third and 13.0% in the fourth.

More positive economic news arrived in July 2010, when Lithuania’s statistics office reported that the Lithuanian economy had experienced its first quarterly growth in seven quarters in the second quarter of 2010. During the second quarter, April through June, the Lithuanian economy expanded at an annual- ized rate of 1.1%, driven by strong exports and rising industrial output. The economy’s performance topped most economic forecasts, which had predicted it would contract. In 2010, the GDP rate of change in Lithuania was 1.3%. Inflation stood at 0.9%, and unemployment was reported at 17.9%.

Economic growth surged in 2011, heralding Lithuania’s successful navigation of the global financial crisis. Lithuania’s GDP grew by 6.0% in 2011, and although growth slowed in the coming years, down to 3.5% in 2013 and 3.0% in 2014, the economy continued to expand. At the same time, unemploy- ment declined, falling from 15.3% in 2011 to 13.2% in 2012 and 11.3% in 2014. In 2015, the CIA estimated Lithuania’s GDP to be growing at a rate of 1.8%, with unemployment down to 8.2%. The IMF found that inflation stood at 0.01%.

In January 2015, Lithuania added stability to its growing economy as it adopted the euro for its national currency. As of early 2016, Lithuania, which had pegged its previous currency at 3.5 to 1 before switching to the euro, was profiting from its newfound membership in the eurozone. One year after the adoption of the euro, in January 2016, the chief economist of the Nordea Bank in Vilnius, Zygimantas Mauricas, praised the country’s new currency: “The euro helped build business confidence and consumer confidence � Now you have stability and the common currency just makes it easier to do business and to invest.”

20 INCOME

In 2015, the CIA estimated that the GDP of Lithuania was $82.1 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. Per capita GDP was estimated at

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$28,000. It was estimated that agriculture accounted for 3.5% of GDP; industry, 30.7%; and services, 65.8%.

According to the World Bank, remittances from citizens living abroad totaled $2.1 billion and accounted for ap- proximately 4.4% of GDP.

In 2014, the World Bank estimated that Lithuania, with 0.04% of the world’s population, accounted for 0.1% of the world’s GDP. By comparison, the United States, with 4.4% of the world’s population, accounted for 28.1% of world GDP.

A study by the World Bank from 2014 reported that actual household final consumption expenditure in Lithuania was 63.0% of GDP and accounted for 0.1% of world consumption. The actual household final consumption expenditure was grow- ing at an average annual rate of 4.1%. By comparison, the United States accounted for 25.4% of world individual consumption. The World Bank also estimated that 42.9% of Lithuania’s household expenditure was spent on food and bever- ages, 9.1% on housing, 8.5% on clothing and footwear, 3.8% on energy, 6.9% on health, 9.8% on transportation, 1.7% on communications, 4.9% on health, and 12.4% on other goods and services measured in US dollars.

By 2012, the portion of the population above the poverty line had risen to 20.6%.

21 LABOR According to the CIA, Lithuania had a total labor force of 1.5 million people in 2015. Unemployment was estimated at 8.2% in 2015. The CIA estimated that 7.9% of the labor force was employed in agriculture, 19.6% in industry, and 72.5% in the service sector in 2012.

The constitution recognizes the right for workers to form and join trade unions. According to the International Labour Organization, 8.8% of employees were union members in 2013. There were four major trade union organizations. The law also provides for the right of workers to strike, except those in es- sential services in the public sector. Collective bargaining agree- ments covered 9.7% of paid workers in 2013.

The legal minimum wage is periodically adjusted by the government for inflation, but these adjustments lag behind the inflation rate. The minimum wage was €350 per month, as of early 2016. The legal minimum age for employment is 16 years without parental consent, or 14 years with written parental consent. The 40-hour workweek is standard for white-collar workers, while 48-hour weeks are standard for blue-collar work. The law stipulates occupational health and safety standards, but these are not always effectively enforced. In a 2014 report, the State Labor Inspectorate concluded that most violations of labor law occur in construction.

22 AGRICULTURE As of 2013, 46.1% of land in Lithuania was devoted to agriculture. The country’s major crops include grain, mixed grasses and legumes, sugar beets, potatoes, forage and silage, fruits, and vegetables. According to the UN Food and Agriculture Organization (FAO) in 2013, cereal production amounted to 4.7 million tons; fruit production, 87,450 tons; and vegetable production, 339,280 tons.

Privatization in agriculture rapidly advanced after 1991. In 2007, there were 230,000 agricultural holdings, which represented a 9% decrease from 2005. Due to a lack of financial

resources and inefficiency in the crediting system, many of these new farmers were operating at subsistence levels. The number of holdings decreased to 199,910 in 2010. Organic farming is expanding rapidly and accounted for 5.5% of farmland by 2015.

23 ANIMAL HUSBANDRY

The FAO reported that Lithuania dedicated 568,400 ha (1.4 million ac) to permanent pasture or meadow in 2013. During that year, the country tended 8.8 million chickens, 729,200 head of cattle, and 807,500 pigs. The production from these animals amounted to 37,709 tons of beef and buffalo, 86,965 tons of pork, 92,980 tons of poultry, 47,700 tons of eggs, and 1.7 million tons of milk. Lithuania also produced 3,082 tons of cattle hide and 166 tons of raw wool. Livestock in 2013 included 82,800 sheep and 29,500 horses.

24 FISHING

Klaipeda’s fishing port is the center of the fishing industry of Lithuania. There are 18 fishery and aquaculture enterprises in Lithuania, as well as 2 aquaculture closed-system enterprises. Over 50 farmers carry out fish pond aquaculture on a com- mercial scale, primarily for the production of red carp. Other principal species include mackerel, sardines, and hairtail. In 2014, the annual capture totaled 150,067 tons, while aquaculture production totaled 3,836 tons, according to the FAO. Lithuania exported 114,324 tons of seafood products, worth $459 million, in 2013.

25 FORESTRY

According to the FAO, forests covered 2.2 million ha (5.4 mil- lion ac), or about 34.7% of the total land area in 2013. The forestry, wood products, and paper industries are some of Lithu- ania’s oldest. Furniture, matches, and timber products were manufactured in Kaunas and Vilnius in the mid-1800s, and furniture making prevailed from 1919 to 1940. Chemical timber processing and the production of furniture, pulp, paper, wood fiber, wood chips, joinery articles, and cardboard are the main activities of the modern forestry sector. Intensive timber process- ing, as well as the recycling of industrial waste, is being expanded. The FAO estimated the 2014 roundwood production at 7.4 million cu m (261.3 million cu ft). The export value of all forest products in 2014, including roundwood, totaled $690.4 million.

26 MINING

Lithuania’s production of nonfuel minerals in 2013 included ce- ment, limestone, nitrogen (from ammonia), and peat. Other industrial minerals produced were clays, sand, and gravel. Lithu- ania remains dependent on imports for its metals and fuel needs. Peat is extracted in the Siauliai, Ezherelis, Paraistis, and Baltoyi- Boke regions. Mineral production figures in 2013 included limestone, 1.5 million tons, up from 911,900 tons in 2009; ce- ment, 1.2 million tons, compared to 583,100 tons in 2009; and peat, 432,602 tons, down from 542,500 tons in 2009.

27 ENERGY AND POWER

The International Energy Agency reported in 2013 that Lithu- ania produced 4.8 billion kWh of electricity, including 2.2 bil-

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lion kWh from gas-fired plants, 1.1 billion kWh from hydroelectric power plants, and 603 million kWh from wind. The nation imported another 8.1 billion kWh and exported 1.1 billion kWh, for a total domestic supply of 11.7 billion kWh. In 2013, Lithuania consumed 10.8 billion kWh, or 3,660 kWh per capita.

Crude oil production totaled 88,000 tons in 2013. Lithu- ania imported another 9.8 million tons of crude oil and produced 9.7 million tons of oil products in domestic refineries. Exports of oil products totaled 8.4 million tons. Domestic oil consumption totaled 1.7 million tons, including 1.4 million tons in the transportation sector, 40,000 tons in the industrial sector, and 45,000 tons in the agriculture/forestry sector. Natural gas consumption totaled 1.3 million tons of oil equivalent.

Lithuania has no reserves of natural gas, but it does have a small amount of recoverable coal reserves. As of 2015, Lithuania had 12 million barrels of proven oil reserves, but potential onshore and offshore reserves could be much greater. Lithuania imports the bulk of its oil, mostly from Russia.

The nation’s only oil refinery, the Mazeikiai Refinery, has a production capacity of 15 million tons of crude per year.

28 INDUSTRY Lithuania underwent rapid industrialization during the Soviet era. In 2015, the CIA reported industry had contributed 30.7% of GDP, up 3.6% from the previous year. According to the CIA, major industries, listed in order of annual output (greatest to least), were metal-cutting machine tools, electric motors, televi- sion sets, refrigerators and freezers, petroleum refining, shipbuilding (small ships), furniture, textiles, food processing, fertilizers, agricultural machinery, optical equipment, lasers, electronic components, computers, amber jewelry, information technology, video game development, and biotechnology. Industry accounted for 19.6% of the labor force in 2015.

In 2015, Lithuania ranked 38th on INSEAD’s Global In- novation Index.

Due to a rapid program of privatization, more than 80% of Lithuania’s enterprises were privately owned by 1995. Most capital investment has gone into the industrial sector, including upgrading the oil refinery, the nuclear power plant, construction of a main highway, and the modernization of seaport facilities.

29 SCIENCE AND TECHNOLOGY The Lithuanian Academy of Science (LAS), founded in 1941, is an independent consultant to the government on research, higher education, and other issues. The LAS has several divi- sions: Humanities and Social Sciences; Mathematical, Physical, and Chemical Sciences; Biological, Medical, and Geosciences; Agricultural and Forestry Sciences; and Technical Sciences. The divisions cooperate with each other and with other scientific institutions. The LAS established or expanded 24 scientific research institutes in Lithuania. Four other institutes conduct research in medicine and forestry. Seven universities and colleges offer degrees in basic and applied sciences.

According to the World Bank, high-technology exports (products with high research and development intensity, such as in aerospace, computers, pharmaceuticals, scientific instruments, and electrical machinery) accounted for 10% of Lithuania’s manufactured exports in 2013, which amounted to $1.8 billion. Patent applications in science and technology totaled 117 in

Lithuania, according to the World Bank. There were 2,287 researchers engaged in research and development (R&D) per million people in 2013. That year, Lithuania spent 1.0% of GDP on R&D.

30 DOMESTIC TRADE

Vilnius, Klaipėda, and Kaunas each have shopping areas and several markets; many smaller towns have a central market. Several supermarkets have also opened, and there are a number of newer privately owned import businesses taking root. There is little interest in franchising by local companies. With the excep- tion of one or two companies, those that have tried franchising found it to be unprofitable. As of 2015, a 21% value-added tax (VAT) is applied to most sales and services in Lithuania; there is a 9% rate on heating services, public transport services, and books. Pharmaceutical products and medical equipment have a 5% VAT.

Business office hours are generally from 9 a.m. to 5 p.m., Monday through Friday. Banks are usually open from 8 a.m. to 3 p.m., Monday through Friday, although some banks are open on weekends. Shops are generally open Monday through Saturday from 9 a.m. to 7 p.m., although many stores are open on Sundays as well.

31 FOREIGN TRADE

Before gaining independence in 1991, Lithuania’s foreign trade was restricted. In the post-Soviet market during the mid- to late 1990s, Lithuania began trading more with Western nations, reducing its reliance on trade with former Soviet republics. Trade with the West increased from 15% to 60% between 1990 and 1995, while trade with former Soviet republics fell from 78% in 1990 to 40% in 1995. Imports and exports increased fourfold between 2004, when Lithuania was admitted to the EU, and 2009.

In 2014, oil and mineral fuels made up Lithuania’s most beneficial export commodity (17.6%), followed by industrial machinery (8.5%) and electrical machinery (6.6%). Other export commodities included furniture (6.3%), plastics (5.6%),

Principal Trading Partners–Lithuania (2014) (In millions of US dollars)

Exports

32,318.5 6,750.4 2,343.4 2,685.2 2,965.4 1,440.7 1,221.7 1,505.2 1,411.3

598.6 481.6

Imports

34,360.9 7,102.0 3,846.3 3,308.7 2,434.5 1,691.2 1,451.3

993.1 927.3

1,725.7 1,209.6

Balance

-2,042.4 -351.6

-1,502.9 -623.5 530.9

-250.5 -229.6 512.1 484.0

-1,127.1 -728.0

66,679.4 13,852.4 6,189.7 5,993.9 5,399.9 3,131.9 2,673.0 2,498.3 2,338.6 2,324.3 1,691.2

Total

World Russia Germany Poland Latvia Netherlands United Kingdom Belarus Estonia Italy Belgium

Country

(…) data not available or not significant. (n.s.) not specified.

SOURCE: International Monetary Fund Direction of Trade Statistics, http://data.imf.org

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and motor vehicles and parts (4.5%). The main import com- modities were oil and mineral fuels (24.4%), industrial machinery (9.4%), electrical machinery (6.9%), motor vehicles and parts (6.1%), plastics (4.0%), pharmaceuticals (3.0%), and organic chemicals (2.3%). Major import partners in 2014 were Russia, Germany, Poland, Latvia, and Italy. Major export partners were Russia, Latvia, Poland, Germany, Belarus, the Netherlands, Estonia, and the United Kingdom.

32 BALANCE OF PAYMENTS

According to the CIA, Lithuania had a current account balance of -$926 million in 2015, amounting to -1.6% of the GDP. That year, Lithuania had exports of goods totaling $30.9 billion and imports totaling $34.0 billion. Total reserves (including gold) increased from $8.1 billion in 2013 to $8.7 billion in 2014. The IMF reported that foreign reserve assets totaled $794 million in 2016.

33 BANKING AND SECURITIES

Since 1991, Lithuania has reorganized its banking sector numer- ous times. Myriad banks emerged after independence, most of them weak. Consequently, consolidations, mergers, and collapses became a regular feature of the country’s banking system.

On 3 July 1992, the government adopted a new currency unit, the lita, to replace the ruble. Between 1992 and 1995, six banks lost their licenses and two were merged; as of mid-1996, 16 were either suspended or facing bankruptcy procedures. The first serious crisis centered on Aurasbankas, the eighth-largest bank in the country and the deposit bank for many ministries. The Bank of Lithuania suspended Aurasbankas’s operations in mid-1995 because of liquidity problems caused by bad lending and deposit-taking practices. In July 1995, the minimum capital

requirement for existing banks was raised from LTL 5 million to LTL 10 million, the level already established for new banks.

Operations at Lithuania’s largest bank, the Joint-Stock In- novation Bank, were suspended on 20 December 1995, and operations at Litimpeks Bank, the country’s second-largest, were suspended two days later. The two were in the process of merg- ing to create the Lithuania United Bank, and fraud was uncovered during the premerger audits. Due to rumors of a devaluation of the currency, a shortage of foreign exchange throughout the banking sector was created.

Because Lithuania’s currency is the euro, the discount rate, or the rate at which the central bank lends to other financial institutions, is set by the European Central Bank. In December 2013, the discount rate was 0.05%. As of December 2015, the commercial bank prime lending rate, the rate at which banks lend to customers, was 3.2%. The nation’s gold bullion deposits totaled $232 million as of 2015. Lithuania’s stock of foreign exchange reserves and gold was valued at $8.7 billion in December 2014. Market capitalization in December 2012 totaled $4 billion.

The National Stock Exchange, NASDAQ OMX Vilnius, was established in September 1993. As of 2015, there were 97 companies listed on the NASDAQ OMX Vilnius, with a market capitalization of €10.9 billion.

34 INSURANCE Lithuania’s health insurance system maintains many of the characteristics of the Soviet era. The state-run system provides coverage for all residents. In 2013, 6.2% of GDP was spent on health; the government planned to increase expenditures up to 10.3% of GDP by 2050.

According to the Insurance Information Institute (III), nonlife insurance premiums in Lithuania came to $388 million in 2010, while life insurance premiums amounted to $207 million. III reported that Swedbank Elu ($52.6 million) and

Balance of Payments–Lithuania (2014) (In millions of US dollars)

32,750.8 31,497.7

-1,253.1

2,171.5 -739.7

1,505.9

550.5 350.9 163.2

1,648.3 1.3

-537.0 -1,019.1

1,684.6

1,286.9 -802.1

-2,158.5 1,615.0

Current Account Balance on goods Imports Exports Balance on services Balance on income Current transfers Capital Account Financial Account Direct investment abroad Direct investment in Lithuania Portfolio investment assets Portfolio investment liabilities Financial derivatives Other investment assets Other investment liabilities Net Errors and Omissions Reserves and Related Items

(...) Indicates a lack of statistical data that can be reported or calculated from underlying observations. SOURCE: International Monetary Fund Balance of Payments and International Investment Position Statistics, http://data.imf.org

Public Finance–Lithuania (2013) (In millions of euros, general government figures)

Total

11,504 5,621 3,842

879 1,163

12,398 1,843

341 578

1,210 164 86

1,970 287

1,948 3,971

Percent

100.0% 48.9% 33.4% 7.6%

10.1%

100.0% 14.9% 2.8% 4.7% 9.8% 1.3% 0.7%

15.9% 2.3%

15.7% 32.0%

Revenue and Grants Tax revenue Social contributions Grants Other revenue

Expenditures General public services Defense Public order and safety Economic affairs Environmental protection Housing and community amenities Health Recreational, culture, and religion Education Social protection

(…) data not available or not significant.

SOURCE: International Monetary Fund Government Finance Statistics http://data.imf.org

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SEB gyvybės draudimas ($51.1 million) were the primary life insurers, followed by Aviva Lietuva ($48.9 million).

35 PUBLIC FINANCE

The CIA estimated that, in 2015, the budget of Lithuania included $13.3 billion in public revenues and $14 billion in public expenditures. The budget deficit amounted to 1.6% of GDP, and public debt was 38.8% of GDP.

36 TAXATION

As of 2015, personal income was taxed at a flat rate of 15% and individual activity at 5%. Individual activities included income from distributed profits, the sale or rental of property, creative activities, and other types of activities. Individuals receiving capital gains from either the sale of property or shares were generally taxed at 15% on the gains. A 5% tax applied to inherited property if the taxable value was up to €150,000 ($170,955) and 10% if the taxable value exceeded €150,000. There were no gift, property, or luxury taxes.

Social security contributions by employers ranged from 31.0% to 32.6%. Employees contributed 9.0% of their income. Employers contributed 0.2% of gross salaries to the Lithuanian Guarantee Fund, which provides assistance in employer bankruptcy situations.

The standard corporate income tax rate as of 2015 was 15%. A reduced rate of 5% applied to some agricultural and small companies. Excise duties were levied on ethyl alcohol and alcoholic beverages, tobacco products, and fuels. A land tax was assessed at the municipal level and ranged between 0.01% and 4.0%. Real estate tax ranged between 0.3% and 3.0%. Capital gains were considered part of corporate profit and taxed at the corporate rate.

The standard VAT rate increased in 2011 from 19% to 21%, applicable to most goods and services, and three reduced rates of 9%, 5%, and 0%. As of 2015, the 9% rate applied to books, some periodicals, public transport services, heating and hot water services to residential properties, and hotel accommodations. The 5% rate applied to some drugs and medi- cal devices, as well as devices for the disabled. Exports and some export-related services; international transport, ships, and aircraft; and EU-related trade or supplies were zero-rated. Exempted from the VAT were educational, healthcare, insur- ance, and financial services; the leasing, sale, or transfer of im- movable property (including dwellings); and social, sports, cultural, radio, and television services, if provided by nonprofit organizations.

37 CUSTOMS AND DUTIES

In 1993, Lithuania, Estonia, and Latvia formed a free trade area, which eliminated customs duties and quotas between the three Baltic States. In accordance with Lithuania’s participation in the EU, some duties on EU goods have been lowered. Most foreign imports, including all raw materials, are duty-free. As of 2016, Lithuania employed the EU’s Common External Tariff, which designated individual fees to import various commodities from the United States, such as 0% for wool products, 1.7% for cement, and 6.5% for windows. A 21% VAT was also placed on imports. In 2016, the World Bank ranked Lithuania 20 out of 183 economies for ease of trade across borders.

38 FOREIGN INVESTMENT

Foreign investment is regulated by more than two dozen bilateral agreements. In July 1999, a foreign investment law was passed, establishing equal protection of Lithuanian and foreign investors and free access to all of the nation’s economic sectors. Various tax benefits may be granted to foreign investors depending on the type and size of the investment. When purchasing privatized Lithuanian companies or forming joint ventures, foreign inves- tors are usually expected to provide employment guarantees.

Foreigners from the EU and NATO member nations may own land; foreigners from all other nations may not. The provi- sion is aimed primarily at foreigners from former Soviet republics, who are the main non-Western investors in Lithuania. Foreigners not eligible to own land may rent it for a period of up to 99 years.

Foreign direct investment (FDI) inflow into Lithuania reached $350.9 million according to World Bank figures published in 2014. FDI represented 0.7% of GDP. On 31 March 2015, total FDI in Lithuania reached €12.5 billion, with most of it coming from the EU. In 2015, the largest chunk of this capital inflow went to the following sectors: finance and insurance (27.7%), manufacturing (21.1%), trade (10.5%), and real estate (14.3%).

Lithuania continues, despite its small size, to be an attrac- tive location for FDI and a competitive center for product sourcing. It boasts a highly skilled labor force, competitive costs, a stable political and economic environment, a strong currency, and the region’s most developed infrastructure.

39 ECONOMIC DEVELOPMENT

In 1990, the Lithuanian government began a comprehensive economic reform program aimed at creating a market-driven economy. Reform measures included price reform, trade reform, and privatization. By mid-1993, about 92% of housing and roughly 60% of businesses slated for privatization had been privatized. By 1996, about 36% of state enterprises and about 83% of all state property had been privatized. International aid agencies committed about $765 million of assistance in 1992– 95. Most international aid went either to infrastructure construc- tion or loan credits to business. Citing continued progress toward democratic development, the United States announced in 1999 that it was terminating economic assistance to Lithuania. Having established itself as a democratic society with a market economy, Lithuania was invited to join the EU in 2002, and it became a member in 2004.

In 2001, Lithuania negotiated a 19-month, $119-million standby arrangement with the IMF. In 2002, the country’s GDP grew at a rapid pace (6.0%–6.7%), unemployment declined, the inflation rate fell to near zero, and there was a lower-than-expected general government deficit. In 2002, the tax system was aligned with EU requirements, the financial situ- ation of municipalities and the Health Insurance Fund were improved, privatization moved forward, and the financial sector was strengthened. The privatization program for 2003 included the sale of a second 34% stake in Lithuania Gas, one or two electricity distribution companies, and four alcohol producers.

In 2003, Lithuania was one of the most dynamic economies in Europe, with 9.7% GDP growth, and it continued strongly through 2004 and 2005. However, amid the 2008–09 global financial crisis, GDP growth dropped to -14.7%. In 2010, GDP

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rebounded slightly, growing by an estimated 1.3% before slightly more robust growth returned in 2011 at a rate of 6.0%.

In January 2015, just over a decade after joining the EU, Lithuania adopted the euro as its currency. Lithuania had profited from its EU membership even before entering the euro- zone; its per-capita GDP increased by 55% between 2005 and 2015. Despite concerns about the euro’s viability amid rumblings of both Greece and the United Kingdom exiting the EU in 2016, the Lithuanian economy was thriving after its first year of using the euro. In January 2016, Nordea Bank’s chief economist Zygimantas Mauricas praised the new currency: “The euro helped build business confidence and consumer confidence. People thought that the euro would make things more expensive.� Instead, people ended up making more money.” In 2015, Foreign Policy’s Baseline Profitability Index ranked Lithu- ania second in Europe for investment for the second consecutive year, behind Poland.

As of 2016, an inflow of structural funds from the EU was expected to trigger further economic growth. Lithuania’s Operational Programme for EU Structural Funds Investments for 2014–2020 brought together three crucial EU investment funds: the Cohesion Fund (€2 billion), the Regional Development Fund (€3.5 billion), and the European Social Fund (€1.1 billion). The multifund program was designed to address a number of key areas for Lithuania’s economic develop- ment, including improving social inclusion, decreasing unemployment, improving energy security by shifting the energy sector toward a low-carbon economy, spurring on research and innovation, and reducing poverty.

40 SOCIAL DEVELOPMENT A national system of social insurance covers all of Lithuania’s residents. Old-age (pension), sickness, disability, and unemploy- ment benefits are paid on an earnings-related basis from contributions by both employers and employees. Retirement is set at age 65 for both men and women, with at least 30 years of contribution at the normal pensionable age. The pension may be deferred from 1 to 5 years. Family allowance benefits are provided by states and municipalities to families with low incomes. There is a universal system of medical care and a dual social insurance and social assistance program for maternity and health payments.

Legally, men and women have equal status, including equal pay for equal work, although in practice women are under- represented in managerial and professional positions. Discrimina- tion against women in the workplace persists. Violence against women, especially domestic abuse, is common. In 2009, an estimated 56% of divorced women and 15% of married women had suffered domestic violence, and 20% had experienced sexual harassment, the most recent statistics available. The Law on Protection against Domestic Violence came into force in December 2011, which made it easier to prosecute offenders. Child abuse is also a serious social problem. Authorities link the upsurge in abuse to alcoholism.

Human rights are generally respected in Lithuania, and hu- man rights organizations are permitted to operate freely and openly. Prolonged detention still occurs in some cases, and poor prison conditions persist.

In July 2009, the government passed a controversial child censor bill that raised concern among prominent international human rights organizations. The law officially bans public dis-

semination of material that is considered to be harmful to minors. Such harmful material includes media that is deemed to promote violence, gambling, bad eating habits, paranormal phenomena, hypnosis, and, more directly, homosexuality, bisexuality, and polygamy. The law was used in 2014 to block an LGBT awareness video produced by the Lithuanian Gay League. A formal investigation on the ruling by the European Commission’s Directorate General for Communication Networks, Content, and Technology began in 2015.

The issue of LGBT rights is a heated one in Lithuania partly because of the nation’s predominantly Catholic population. In 2009, a faction of the parliament began to seek an outright ban on homosexuality within the nation, claiming that such a measure was necessary in defense of traditional fam- ily values; however, as of early 2016, no such law had been passed. International human rights groups argued that the nation’s “antipropaganda” laws are a clear infringement on the right of freedom of expression and that the ban on materials concerning homosexuality could prohibit legitimate discussion of the topic and could lead to greater discrimination against gay, lesbian, bisexual, and transgendered individuals.

41 HEALTH

In 2011, Lithuania had approximately 41 physicians per 10,000 inhabitants. Most primary care providers were women. The public health system is composed of public health centers man- aged by the Ministry of Health and several agencies with specific functions (public health research and training, health surveil- lance, mental health, communicable disease control, radiation protection, emergency situations, and health education and disease prevention). Municipal public health bureaus are responsible for a number of functions at the local level. As of 2013, the country spent 6.2% of its GDP on healthcare.

In 2014, the vaccination rate was 93% both for diphtheria, pertussis, and tetanus and for measles. The incidence of tuberculosis was 62 cases per 100,000 people. Safe drinking water was available to 96.6% of the population, and 92.4% had access to improved sanitation facilities.

According to the CIA, life expectancy in Lithuania was 74.7 years in 2015. That year, the total fertility rate was estimated at 1.6 children born per woman. The infant mortality rate was 3.8 deaths per 1,000 live births. The maternal mortality rate was estimated at 10 deaths per 100,000 live births.

42 HOUSING

Lithuania’s 2011 census indicated that the country had about 1,389,059 dwellings, which was a 7.4% increase from the 2001 census. Approximately 38% of all housing units were one- dwelling buildings, and 62% were apartments. About 96.6% of these units were privately owned. Roughly 63.2% of the total population lived in two- or three-room dwellings, with an aver- age floor area of 30–49 sq m (323–527 sq ft). The average liv- ing space was about 26.2 sq m (282 sq ft) per person. About 85.8% of all conventional dwellings were equipped with water supply; 76% had bath and shower facilities and 52.6% had central heating. The availability of conveniences in rural areas grew between 2001 and 2015 but remains significantly lower than the national average.

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43 EDUCATION

The United Nations Educational, Scientific and Cultural Organization (UNESCO) estimated that Lithuania had a literacy rate of 99.8% in 2015.

Education is free and compulsory for all children between the ages of 7 and 16 years. While Lithuanian is the most com- mon medium of instruction, children also study Polish, Russian, and Yiddish. Primary school covers four years of study, followed by six years of basic or lower secondary school. Students then move on to either two years of senior secondary school or vocational schools, which offer two- to three-year programs. The academic year runs from September to June.

According to UNESCO, 98% of age-eligible children in Lithuania were enrolled in primary school in 2013. That year, secondary enrollment for age-eligible children stood at 94.3%. Tertiary enrollment was estimated at 72%. Tertiary enrollment rates among females were 86.1% and 58.5% among males.

The four main universities are Kaunas University of Technology (founded in 1950), Vilnius Technical University (founded in 1961), Vilnius University (founded in 1579), and Vytautas Magnus University (founded in 1922). According to UNESCO, public expenditure on education represented 17.7% of GDP in 2011.

44 LIBRARIES AND MUSEUMS

The National Library at Vilnius had 5 million volumes as of 2012, according to the Online Computer Library Center (OCLC). Founded in 1570, the Vilnius University Library has a similarly large collection. Vilnius also has the notable Central Library of the Academy of Sciences. There are dozens of other special collections in the country, including libraries maintained by the Union of Lithuanian Writers, the State Institute of Art, and the Institute of Urban Planning. The Institute of Lithu- anian Literature and Folklore in Vilnius contains over 240,000 printed items. The Lithuanian Librarians’ Association was established in 1931, disbanded under German occupation in 1941, and reorganized in 1989. The OCLC reported that Lithu- ania had 49 academic libraries and 65 public libraries in 2011. That year, public library holdings totaled 18.6 million volumes.

The majority of Lithuania’s museums are in Vilnius, including the Lithuanian Art Museum (1941), the National Museum (1856), the Museum of Lithuanian Religious History, and the Lithuanian State Museum, founded in 1991 to com- memorate the country’s suffering under and resistance to Soviet occupation. The Mikalojus Konstantinas Ciurlionis National Art Museum, named for a famous native composer and painter, is located in Kaunas; special branches of this museum include the Devil’s Museum, a collection of artwork depicting devils, and a Ceramics Museum. The Museum of the Center of Europe, an open-air museum displaying large-scale works by European art- ists, was opened in Vilnius in 1994. There is also the Park of Soviet Sculptures in Druskininkai. The Lithuanian Theater, Music and Film Museum in Vilnius was founded by the Ministry of Culture. There are several other specialized museums, including the Museum of Genocide Victims in Vilnius, Museum of the History of Lithuania Medicine and Pharmacy in Kaunas, Museum of Ancient Beekeeping in Ig- nalina, and Museum of Vilnius Sport History. There are several regional museums associated with secondary schools; these contain materials on local arts and history, as well as the history

of the local school. According to the OCLC, Lithuania had 251 museums as of 2013.

45 MEDIA

According to the CIA, Lithuania’s telecommunications system is adequate and is being modernized to improve international capability and better residential access. Mobile cellular systems are being installed, and access to the Internet is available. International service is provided through landlines and submarine cable connections to satellite ground stations. As of 2014, there were 590,000 main phone lines and 4.4 million mobile cellular phones in use, averaging 152 subscriptions per 100 people.

Lithuania has private TV and radio broadcasters, as well as the publicly owned Lithuanian National Television and Radio (LRT), which operates three TV channels and three radio networks. Radio Vilnius broadcasts in Lithuanian, Russian, Pol- ish, and English. As of 2001, there were 29 AM and 142 FM radio stations and 1 shortwave radio station, the most recent data available. As of 2013, 81% of Lithuanian households had access to digital television. According to the CIA, in 2012, the country had 1.2 million Internet hosts. In 2014, Internet users numbered 2 million, or 70.3% of the population.

The constitution provides for free speech and a free press, and the government is said to uphold these provisions. After independence, the independent print media flourished, produc- ing some 2,000 newspapers and periodicals. The most popular daily newspapers, with 2010 circulation figures listed parentheti- cally, were Lietuvos Rytas (Lithuania’s Morning, in Russian; 50,000), Respubliká (55,000), Lietuvos Aidas (Echo of Lithuania, 20,000), and Kauno Diena (Kaunas Daily, 38,000).

46 ORGANIZATIONS

Important economic organizations include the Association of Chamber of Commerce and Industry, an organization that coordinates the activities of all the chambers of commerce in Lithuania. There are three umbrella trade union organizations in the country: the Lithuanian Trade Union Confederation, the Lithuanian Labour Federation, and Solidarumas. Professional as- sociations exist for a number of fields and occupations.

The Lithuanian Academy of Sciences promotes education and research in a wide variety of scientific fields. The Lithuanian Medical Association promotes research and education on health issues and works to establish common policies and standards in healthcare. There are several other associations dedicated to research and education for specific fields of medicine and particular diseases and conditions, such as the Lithuanian Heart Association.

There are a number of sports associations in the country, representing such pastimes as speed skating, squash, tae kwon do, tennis, badminton, weightlifting, and baseball. There are also branches of the Paralympic Committee. The Lithuanian Youth Council is a nonprofit umbrella structure that helps organize and support a variety of national youth organizations. Scouting programs and chapters of the YMCA/YWCA are also active for youth. Volunteer service organizations, such as Lions Clubs International and Kiwanis International, are also present. The Red Cross is active in the country.

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47 TOURISM, TRAVEL, AND RECREATION

The capital city of Vilnius has one of the largest historic districts in Eastern Europe, distinguished primarily by its Baroque churches, many of which have been reclaimed since indepen- dence by money and missionaries from abroad. Kaunas, Lithu- ania’s second-largest city, offers tourists old merchants’ buildings and museums. The seaside resort towns are active in the summer. Travelers can participate in tennis, fishing, sailing, rowing, and winter sports. Lithuanians have long distinguished themselves at basketball and have contributed top players to former Soviet teams. Lithuanian athletes have won six Olympic gold medals. The national basketball team won bronze medals in Barcelona in 1992, Atlanta in 1996, and Sydney in 2000.

All visitors need a valid passport. Visas are not required for nationals of the EU states, the United States, Canada, Japan, Australia, and some South American and South Asian countries for traveling to Lithuania for up to 90 days. Travelers of non-EU countries must carry proof of medical insurance to travel in Lithuania.

In November 2010, the traditional multipart song form known as sutartinės was officially inscribed on the UNESCO Representative List of the Intangible Heritage of Humanity, an offshoot of the World Heritage program. The musical form was deemed a living tradition by UNESCO, meaning that it is still passed from generation to generation and continues to create a sense of identity and community for those who participate. Such traditions have been approved by UNESCO for special consideration since 2001. For inscribed traditions, a special program is designed to protect and promote the practice and understanding of the tradition. The sutartinės are polyphonic in form, involving the use of several simple melodic lines that can be sung at staggered intervals, in a canon form, at parallel seconds or as a call-and-response between groups of singers. The poetic texts usually cover a wide variety of themes, with some designated for weddings or other family events and others based on historic themes, such as war. The performance of the sutartinės promotes a sense of cultural identity.

The Compendium of Tourism Statistics, published electroni- cally by the UN World Tourism Organization, reported 5.3 mil- lion incoming tourists to Lithuania in 2014. These tourists spent a total of $1.4 billion.

48 FAMOUS PERSONS

President Valdas Adamkus (b. 1926) was chief of state from 1998 to 2003 and again from 2004 to 2009. Mindaugas (1200– 1263), the only king of Lithuania, was responsible for uniting lands to create a country. Bernardas Brazdzionis (1907–2002) was an influential romantic poet. Lithuania’s best-known modern female prosaist, dramatist, painter, and essayist is Jurga Ivanauskaite (1961–2007). Jonas Mekas (b. 1922) is a leading personality in avant-garde cinema in the United States. The first Lithuanian artist to gain international attention was Mikalojus Konstantinas Curlionis (1875–1911), who created more than 350 musical artworks and 500 paintings. One of the most important militants for Lithuanian independence, Jonas Basa- navicus (1851–1927) was a scientist, doctor, and freethinker. Marija Gimbutiene (1921–1994) was among the world’s most influential archeologists and anthropologist and the author of 23 scientific books.

49 DEPENDENCIES

Lithuania has no territories or colonies.

BOOKS

Agyeman, Julian, and Yelena Ogneva-Himmelberger, eds. Environmental Justice and Sustainability in the Former Soviet Union. Cambridge, MA: MIT Press, 2009.

Donskis, Leonidas. Identity and Freedom: Mapping Nationalism and Social Criticism in Twentieth-Century Lithuania. New York: Routledge, 2002.

Felder, Björn M., and Paul J. Weindling, eds. Baltic Eugenics: Bio-Politics, Race and Nation in Interwar Estonia, Latvia and Lithuania 1918–1940. Amsterdam: Rodopi, 2013.

Frucht, Richard, ed. Eastern Europe: An Introduction to the People, Lands, and Culture. Santa Barbara, CA: ABC-CLIO, 2005.

Hoshi, Iraj, Ewa Balcerowicz, and Leszek Balcerowicz, eds. Bar- riers to Entry and Growth of New Firms in Early Transition: A Comparative Study of Poland, Hungary, Czech Republic, Albania, and Lithuania. Boston: Kluwer Academic, 2003.

Janušauskiene, Diana. Post-Communist Democratisation in Lithu- ania: Elites, Parties, and Youth Political Organisations 1988– 2001. Amsterdam: Rodopi, 2011.

Knudsen, Ida Harboe. New Lithuania in Old Hands: Effects and Outcomes of EUropeanization in Rural Lithuania. London: Anthem, 2013.

Lane, Thomas. Lithuania: Stepping Westward. New York: Rout- ledge, 2014.

Opello, Walter C. European Politics. Boulder, CO: Lynne Ri- enner, 2009.

Suziedelis, Saulius. Historical Dictionary of Lithuania. 2nd ed. Lanham, MD: Scarecrow, 2011.

Thompson, Wayne C. Nordic, Central, and Southeastern Europe, 2010. 10th ed. Harpers Ferry, WV: Stryker Post, 2010.

PERIODICALS

Hulse, Carl. “John Boehner Reassures Lithuania of Support against Russia.” New York Times, 29 June 2015. http://www .nytimes.com/politics/first-draft/2015/06/29/boehner-reas sures-lithuania-of-support-against-russia/.

Juozeliūniene, Irena. “The Development of the Outline for Migrant Family Research: The Case of Lithuania.” Journal of Comparative Family Studies 44, no. 6 (2013): 749–63.

Klumbyté, Neringa. “Europe and Its Fragments: Europeaniza- tion, Nationalism, and the Geopolitics of Provinciality in Lithuania.” Slavic Review 70, no. 4 (2011): 844–72.

“Lithuania and the Euro: Strange Bedfellows.” Economist, 4 December 2014. http://www.economist.com/news/finance -and-economics/21635525-euro-zones-newest-member-faces -uphill-struggle-strange-bedfellows.

Rapoza, Kenneth. “Lithuania and the Euro: One Year Later, the Romance Continues.” Forbes,10 January 2016. http://www .forbes.com/sites/kenrapoza/2016/01/10/lithuania-and-the -euro-one-year-later-the-romance-continues/#91d43e67a3fc.

Schmitt, Eric, and Steven Lee Myers. “NATO Refocuses on the Kremlin, Its Original Foe.” New York Times, 23 June 2015. http://www.nytimes.com/2015/06/24/world/europe/nato-re turns-its-attention-to-an-old-foe-russia.html.

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“Lithuania.” Country Reports on Human Rights Practices for 2014. US Department of State. http://www.state.gov/j/drl/ rls/hrrpt/humanrightsreport/index.htm?year=2014&dlid =236546.

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“Lithuania.” International Religious Freedom Report for 2014.

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“Lithuania.” The World Factbook. Central Intelligence Agency. https://www.cia.gov/library/publications/resources/the-world -factbook/geos/lh.html.

“Lithuania Country Profile.” BBC. http://www.bbc.com/news/ world-europe-17536867.

“Operational Programme for EU Structural Funds Investments for 2014–2020.” European Commission. http://ec.europa.eu/ regional_policy/en/atlas/programmes/2014-2020/lithuania/ 2014lt16maop001.

UN Comtrade Database. http://comtrade.un.org/data/. “US Relations with Lithuania.” US Department of State.

http://www.state.gov/r/pa/ei/bgn/5379.htm.

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