The government backed a move by the Agriculture Ministry to revise customs duties for the European Union, drafted by the Foreign Ministry and approved in December, and to immediately initiate consultations with the European Commission.
"I want to emphasize that an increase in customs duties is planned only for the most sensitive foodstuffs," Agriculture Minister Edvardas Makelis said.
He said an introduction of higher duties would protect the domestic market from surplus production and make it easier for local producers to sell their goods.
An increase in the basic and preferential customs duties on key food products is seen by the Agriculture Ministry as a temporary measure of market protection.
It insists that the proposed duties would not violate the main provisions of Lithuania's association agreement with the European Union.
The ministry moves for an average increase of 10 percent on basic duties on beef, pork and meat products, while those on milk products would go up by 4 to 5 percent on average. For instance, the basic duty on beef would rise to 40 percent from the current 30 percent.
The ministry proposes to raise all basic and preferential customs duties to the maximum level of customs tariffs allowed by the European Union and to lower them again in 2000.
The established quotas on beef, pork, milk and other products will remain unchanged.
Some 1,120 tons of beef, 560 tons of pork, the same amount of concentrated milk and cream, as well as cheese and curd, 140 tons of sausages and similar meat products are allowed to be imported from the European Union to Lithuania under 1999 quotas. A slight increase in the quotas is likely next year.
An analysis of Lithuania's trade in food products with the European Union shows a rapidly increasing negative balance for Lithuania.
In 1995, Lithuania's food exports to the European Union amounted to 545.6 million litas ($136.4 million), while its imports stood at 816.6 million litas. The respective figures for 1997 were 495.6 million litas and 1,282.6 million litas and for the three quarters of 1998 - 369 million and 1,103 million litas.