Deal will send Lithuanian food to Moscow

1998-10-22
Paul Beckman

VILNIUS - The adverse effects of the Russian financial crisis on Lithuania have thus far been minimal. With a little more than one-fifth of Lithuanian exports flowing eastward to the country's giant neighbor, however, Lithuanian companies cannot help but feel some influence from Russia's economic woes.

Oct. 13 brought some good news for Lithuanian food companies which export to Russia, as Agriculture Minister Edvardas Makelis and officials of Moscow's city food department wrapped up a deal to get Lithuanian food products back on the shelves in the Russian capital.

Jonas Rekesius, press spokesman for Lithuania's Agriculture Ministry told TBT that a contract was drawn up in which the city of Moscow agreed to buy 2,300 tons of beef, 3,500 tons of butter and other large quantities of various meat and dairy products to the tune of about $16 million. The procedures of exporting the products will be guided by Lithuania's Agricultural Products Regulation Agency.

"The food companies will not sell directly to Moscow," Rekesius explained. "Farmers will sell to companies, and the selling of the companies' products to Moscow, in turn, will be organized by the Agricultural Products Regulation Agency."

Rekesius explained that the deal is positive for all parties involved, considering Russia's economic circumstances and its food supply situation.

"It creates an improved situation for the Lithuanian farmer," said Rekesius. "Three weeks ago, factories bought 70 million litas ($17.5 million) worth of meat. Plus, the Russians need the products. As far as meat is concerned, Russia only produces 6 percent of the amount the country consumes. Moscow itself does not produce any. So Russia relies very heavily on imported meat."

Officials from the Ministry of Agriculture stated they have hopes that the recent deal will set the tone for getting even more Lithuanian products into Moscow next year. Voices of those usually critical of various policies set by the Conservative-led government seemed more amiable about the deal which will send Lithuanian food products to Moscow.

"In general, this faction is supportive of the agreement and welcomes it," said a spokesman for the Social Democrat parliamentary faction. "Members are pleased the Agriculture Ministry is able to find markets for Lithuanian products."