Adamkus' annual address focuses on reforms

  • 2000-04-27
  • By Peter J. Mladineo
VILNIUS - Focusing on the country's economic readjustments, Lithuanian President Valdas Adamkus gave his annual report April 20 in Parliament.

Adamkus blamed the country's current economic crisis on the previous government's mistakes and denials that Lithuania was beset by an economic crisis.

"The Lithuanian economy, even though having suffered huge losses, has passed the test of the Russian crisis. Regrettably, we, the authorities of the state, failed to pass it. Not only did we fail to form a realistic state budget last year but also did not adjust it in time. Only in the face of an obvious threat to the financial and economic stability of the state had the majority of parliament assumed, though with some delay and after a serious in-house crisis, responsibility for the situation in the country and the government started to display a new way of management," Adamkus said.

It was Adamkus who convinced former Prime Minister Gediminas Vagnorius to resign last year. Recall that Vagnorius, when the Russian crisis hit in late 1998 and early 1999, had insisted initially that the country was not suffering from effects of the crisis.

Adamkus called for "essential taxation reform," continued restructuring of state monopolies, and the speeding-up of bankruptcy procedures. He chastized certain political parties for their listless support of Lithuanian businesses.

"While in power both the Democratic Labor Party and the Homeland Union (Lithuanian Conservatives) promoted big business and took a hands-off attitude [in regard to] small and medium sized business," Adamkus said. "Such a position of the authorities has impeded the emergence of the middle class, which is the bedrock of civil society, and resulted in large-scale social differences."

Adamkus added that the government should have a hand in establishing business incubators and reducing bureaucracy.

"Likewise we should look most seriously at the present product lines selecting those which will give us a stronger base for effective expansion in the international markets," he added. Information technology and an improved educational system got the nod from Adamkus as well.

The government needed to help out the country's agricultural sector, Adamkus maintained.

"The state should undertake without further delay a rational approach to differentiated financial support to agriculture and recognize that some aspects of it require social support whereas others, such as commercial farms, require aid to make them stronger and develop a position in the market," he said.

The Parliament, Adamkus said, needed to amend the country's constitution, "the remaining legal obstacle" to Lithuania's accession to the European Union. Adamkus also called for the country to put an end to "anti-Western outbreaks."

"Certainly, we may try to eliminate without any support a decades long gap between the West and us. But we should not forget that the Western world is not static and progresses more quickly than we do. Therefore Lithuania can avoid the fate of a backward province only by catching the high-speed train of Europe and being a fully paid-up passenger on that train," he said. "We should understand that membership in the European Union per se will not bring us a better life. But it will provide more favorable conditions for building our well-being."

Message pleased business

Guoda Stepanoviciene, an expert with the Lithuanian Free Market Institute, praised Adamkus for stressing the need for transparency of public reforms and privatization. Government officials needed to clearly explain the need for reforms to the people, many of whom have grown adverse to change.

"Sometimes it's difficult for people to catch up in their understanding [of the need for reforms]," she said. "The reforms need to be done. The economic problems we have now are mainly the results of reforms that were not started in time."

Adamkus, Stepanoviciene said, directed a lot of his speech to the "mentality issue."

"There were a lot of remarks to the effect that the country should be open to foreign investors. People have to have these things explained to them, and they should not be afraid of foreign investors," she added.

She also praised Adamkus' concerns about agriculture. "It's time to stop telling lies to people in agriculture - that they would receive subsidies, that they would be protected from imports, because this policy doesn't give results. What we need now in agriculture is competition," she said.

Margarita Starkeviciute, an economist who teaches at the Vilnius University International School of Business, felt that this year's address was better than last year's, which featured voluminous political criticisms.

"In this address our president tired to create a vision for the nation in terms of future developments for the country because it seems that Lithuania got off its track a little. There has been a lot of hesitation. It was time to reaffirm our goals - that we are going to the EU, that we have to follow reforms," Starkeviciute said.

However, much of Adamkus' message, she said, was the restating of several issues, many of which lack clear solutions.

"He gave general descriptions of our problems in agriculture and energy, and the tax system. The problem is, everyone knows that we have to reform our tax system but there are no [real] plans to reform it. There are plans that are weak, that are not good enough to implement. It's the same in agriculture. The weakest point is how to do it in practice, how to implement. Everybody knows what is necessary to be done - nobody knows how to do it technically," she said.

Starkeviciute was surprised that the president didn't spend more time focusing on what she called his "main duty" - foreign policy issues.

"He just mentioned NATO and EU but we have other big neighbors, Russia, Belarus, the Baltic region. I expected a little more on foreign policy, this I consider weak policy. It's necessary to improve in this field and it will help our economic problems as well," she said.

Henrik Schmiegelow, head of the delegation to the European Commission in Lithuania, found Adamkus' speech "very positive." He especially liked Adamkus' remarks about the need to join the EU.

"The process is not a process of trying to please the EU, it is a process which is cared for by a wish to make life in Lithuania better, and I think that this is very much the truth," he said.