Speaking to the Lithuanian German Economic Association May 8, Adamkus said that the Lithuanian constitution should have an amendment that would allow foreigners to buy land allotted for agricultural purposes. Currently, foreigners are not allowed to buy any parcel of land that was designated as agricultural land - not even if the foreign interest wants to use the land for another purpose. The President also wants to make it easier for anyone - Lithuanian or non-Lithuanian - to be able to buy land plots initially designated for agricultural uses and use it for other purposes.
"The time has come to allow foreign nationals and companies acquire land of agricultural purpose and slightly change its purpose, if it is necessary," the president said.
However, changing a plot's purpose is a costly and bureaucratic procedure.
"It costs from three to five times more than the plot itself," Audrius Rudys, the president's economic adviser, said. "Say you buy a plot for 300 litas, you have to pay 1,000 for changing the status," he said. "There are a lot of agricultural plots close to forests, close to lakes or rivers. There are many who would like to build motels, hotels, gas stations there, and of course, to change their status."
As Rudys explains, the rule, pushed by members of the Sajudis movement and the Christian Democratic Party, was put in place in 1992. It spoke to concerns that are no longer applicable.
"When the draft constitution was written, there was a quarrel between those who thought that agricultural land was or will be so cheap that there would be no problem for foreigners to buy big plots. Another argument was that there was Lithuania's need to make restitution to former land owners, and to allow a normal land market only after restitution," Rudys said.
The change couldn't come any sooner with Lithuania seeking foreign investment to vault it out of tough economic times.
"Maybe a lot of agricultural plots may become attractive to foreign investors who would like not to invest in farms, but to buy land and change the status and build motels or gas stations, or factories. Right now they can't do it because they don't have the possibility to buy agricultural plots," Rudys said.
Foreign business interests are voicing frustration with the current law.
"I think the land situation in Lithuania is absurd, and has been blocking investment for all the years we've been here," said George Ortiz, director of Iki, the French-Lithuanian supermarket chain. "It's essential that foreigners should be able to buy land easily. There needs to be a liquid market for land where supply and demand forces apply."
Lithuania, Ortiz maintains, needs to establish a land management system like that in Switzerland, where foreigners are permitted to by certain, selected plots of land.
"That way you protect some of the land and you secure some of the ownership for Lithuania. That makes sense for small countries," Ortiz said.
Phillip Morris Lietuva doesn't claim dissatisfaction with the current law because of a favorable 99-year lease on a privatized tobacco factory in Klaipeda. "We're absolutely happy with it," said Ausra Baltiuniene, manager of corporate affairs. "It is absolutely sufficient for the company. It is good for business."
However, Baltiuniene maintains, Lithuania could use a more democratic system of land ownership.
"Rights for local citizens and foreigners should be the same. Selling the land should not infringe the interest of the country, and every country has its own interest. I think it's a natural process for an entity or a natural person to purchase land set for purposes. The same process is in place in Switzerland, the U.S. and Germany. Why should we be any different?"
The legal change will take some time to complete, but it appears that attitudes are indeed ripe for it. Albinas Raudonius, vice minister of agriculture and director of the Agricultural Ministry's land management department, reports that the ministry is already preparing its proposal for new legislation to the government.
"It's a decision for Parliament, but I think the solution will be made in the autumn," Raudonius, said. "But we must also make some restrictions. Now we are looking at the experience of such foreign countries as Denmark, Holland and other EU countries, on which to model legislation. In principle I think we will make this decision."
A political historian might assume that the stage has already been set. In spring 1999, Lithuania already adopted legislation allowing foreigners to buy non-agricultural plots of land.
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