The 2010 result: Estonia, Lithuania, Latvia

VILNIUS - The year is coming to an end and it is now time to look at what the world’s most credible rankings say about the Baltics in 2010. According to international ratings, the situation looks rather cheerful, although the Lithuanian media presents a very dark picture of Lithuania and even jokingly compares it to Burma (or Myanmar, as it is officially called) due to the fact that on Oct. 21, the latter adopted a national flag identical to the Lithuanian tricolor, if you ignore the white star on Burma’s flag.

The mystery of such Lithuanian media-presented darkness can be explained by democracy – just look at the bright picture on Belarusian TV, and just a little bit less bright picture on Russian TV. The organization Reporters Without Borders published the Press Freedom Index of 2010, which evaluated freedom of the media in 178 countries. According to the index, Lithuania’s brother-in-flag Myanmar is No. 174 while Lithuania shares 11th-13th places with Denmark and Japan. For comparison, Finland, Iceland, the Netherlands, Norway, Sweden, and Switzerland share 1st-6th places, Estonia is No. 9, Germany – No. 17, Australia – No. 18, the UK – No. 19, the U.S. – No. 20, Canada – No. 21, Latvia – No. 30, Poland – No. 32, France – No. 44, Israel – No. 86, Zimbabwe – No. 123, Ukraine – No. 131, Georgia – No. 100, Armenia – No. 101, Russia – No. 140, Azerbaijan – No. 152, Belarus – No. 154, China – No. 171, and the former Soviet republic of Turkmenistan is No. 176 ahead of North Korea (No. 177) and Eritrea (No. 178).

The Lithuanian media is freer than it is in the world’s loudest callers for freedom of the press and the majority of its fellow EU states, but Lithuanians, unlike Estonians, are always capable of pointing out the dark side of success. “Freedom of conscience and expression in a young democracy is something that deserves credit and calls for celebration. Quite a few journalists in Lithuania go so far as to slander and attack public figures that happen to be inconvenient for their employers, or are financial donors,” said Leonidas Donskis, Lithuanian member of the European Parliament’s Liberal faction, although the problems mentioned by him are not purely Lithuanian – Rupert Murdoch is not slandered and attacked by his newspapers.

Continuing talking about corruption, let’s look at Transparency International’s 2010 Corruption Perception’s Index (CPI) on 178 countries. The CPI scores countries on a scale of zero to 10, with zero indicating high levels of corruption and 10, low levels. The Lithuanian center-right government of Prime Minister Andrius Kubilius is less corrupt than the previous Social Democrat-led governments. Lithuania for the first time got 5 on that scale (4.9 in 2009 and 4.6 in 2008). Estonia has 6.5 (6.6 in 2009 and 2008) while the situation in Latvia continues to deteriorate with its 4.3 this year (4.5 in 2009 and 5 in 2008). Denmark, New Zealand and Singapore tie for first place with scores of 9.3. Estonia is No. 26, Lithuania shares No. 46-47 together with Macau while Latvia shares No. 59-61 together with Slovakia and Tunisia. For comparison, the UK is No. 20, the U.S. - No. 22, Poland – No. 41, the Czech Republic – No. 53, Belarus – No. 127 while Russia shares No. 154-163 together with Cambodia, Central African Republic, Comoros, Congo, Guinea-Bissau, Kenya, Laos, Papua New Guinea, and Tajikistan.

The corruption level is important data for businessmen. However, there is also a special index named Doing Business, by the World Bank Group, which measures the ease of doing business in 183 economies examining the ease of starting a business, dealing with construction permits, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, and closing a business. Singapore is No. 1, followed by Hong Kong, New Zealand, the UK, and the U.S. The Baltics occupy brilliant positions on that list: Estonia – No. 17, Lithuania – No. 23 and Latvia No. 24 while France is No. 26, Austria – No. 32, Slovenia – No. 42, Belarus - No. 68, Poland – No. 70, China – No. 79, and Russia – No. 123.

Anyway, not only money matters in this world - the most comprehensive rating is the human development index (HDI), by the United Nations. The HDI measures average wellbeing in a country making judgments on health, education and income, and the list is led by Norway, Australia, New Zealand, the U.S., Ireland, Liechtenstein, the Netherlands, Canada, Sweden, and Germany. Estonia is No. 34, Lithuania – No. 44 and Latvia – No. 48.

Although all former co-prisoners of the Soviet empire are left behind (for example, Belarus is No. 61, Russia – No. 65, and Ukraine – No. 69), only two EU states are lower than Lithuania and Latvia on that list: Romania – No. 50 and Bulgaria – No. 58 The entrance of Romania and Bulgaria into the EU in 2007 was good news for the Baltics in the sense that the Balts will never be in the last two places among the EU member states in all kinds of statistics, but this does not cheer Donatas Jankauskas, Lithuanian minister of social security and labor, who called for more coordinated EU policy in terms of labor and social care during the conference Social Cost of the Crisis in the Baltic States, organized by the European Economic and Social Committee and the Lithuanian parliament in Vilnius on Nov. 19. “We all are in the same boat, and if the economics and social situation is ill in one part of the European Union, it will be bad for the entire EU,” Jankauskas said. However, such beggar-style appeals to the rest of the EU sounds naive – the EU is not a federal state yet, although the EU has some features of a federal state and a further tendency towards it.

The main stoppage for HDI development in the Baltics is the mentality of Baltic businessmen. According to Eurostat, the average difference of wealth between the wealthiest strata of EU member state societies and the poorest ones is a factor of three. The same difference is in Belarus and this explains why the dictatorial regime of Alexander Lukashenko manages to survive so long. That difference between the richest and the poorest in the Baltics is more than a dozen times. According to Eurostat, the situation is the best in Estonia and the worst in Latvia, with Lithuania placed in between, although the difference between the three countries is not big in this case. It means that Baltic businessmen prefer to buy planes and cars for themselves, instead of investing into their labor force and business. Since the year 2000, the profit of Lithuanian business rose 44 times, while wages rose only 80 percent. No wonder that this causes mass emigration.

According to Lithuanian Prime Minister Kubilius, the HDI can be raised by focusing on high-tech industries, which would help the Baltics to catch up with neighboring Scandinavia in economic terms. “It was not once that the three Baltic prime ministers discussed the possibilities of our region rapidly catching up with Scandinavian countries. My colleagues, Valdis Dombrovskis and Andrus Ansip, as well as myself are very well aware that our countries must do their own homework. The success of the Nordic-Baltic cooperation will obviously depend on how we will overcome the current crisis, manage to attract new investors and persist in attaining our goal of becoming the Nordic-Baltic region’s high-tech and information technology service center,” Kubilius said during his visit in Helsinki in October. His way of thinking is not bad – let’s go high-tech.