The Weekly Crier
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News highlights from Lithuania, Latvia and Estonia.

News Highlights, from May 4—May 11, 1998

• The three Baltic nations enthusiastically welcomed the recent U.S. Senate’s approval of Poland, Hungary and the Czech Republic into NATO. Baltic governments said they took the vote as a signal from NATO that the door really was open and that they would eventually get in themselves. But some Western officials have urged special caution in regard to the Baltics’ NATO bid, arguing that a highly sensitive Russia must be won over to the idea first. Others have even suggested that now that Poland, Hungary and the Czech Republic are in the NATO fold, expansion should stop—an idea that causes serious consternation among Balts. Washington has sought to reassure Balts that they will get a fair shot at membership. U.S. Deputy Secretary of State Ron Asmus, a chief architect of American Baltic policy, told the May/June edition of City Paper that there was no reason for Baltic pessimism. And he challenged skeptics who say Washington isn’t sincere about pushing Baltic membership through. Said Asmus: "I would say to them—listen to what we say and watch what we do."

• The major newspapers in Estonia severely criticized Estonian Prime Minister Mart Siimann on May 7, urging him to step down after his initiative for early elections fell flat. Prime Minister Mart Siimann, to the surprise of many observers, called snap elections the week before. But he withdrew the plan this past week after failing to muster enough political support. Even Siimann’s own party overwhelmingly rejected the election idea, its members scoffing at the notion of voting their own government out of power. The influential Eesti Paevaleht and Postimees newspapers slammed the premier, saying he appeared tired and unable to cope in his job. It said the call for a parliamentary poll, nine months ahead of scheduled elections, was badly thought out and showed political ineptness. Before dropping the initiative himself, Siimann had argued that only early elections could fix Estonia’s badly fragmented legislature. His coalition government commands the support of just 37 out of 101 legislative seats, and he has repeatedly tried and failed to strike new political alliances. Siimann said that he needed a clear parliamentary majority to maintain Estonia’s fast-paced development.

• A small bomb went off at a Soviet-era war memorial in the Latvian town of Dobele on May 4. The explosion ripped off the leg of a statue of a Soviet soldier, but otherwise caused relatively minor damage to the monument. Police denied that the attack followed the pattern of similar attacks in Latvia in recent weeks. Other bomb blasts last month contributed to a serious deterioration in relations between Riga and Moscow. In early April, explosives went off at a synagogue and in a trash can outside the Russian embassy in Riga. No one was hurt in either incident. Russia has pointed to the bombings as examples of what it says is a rise of extremism in Latvia. The Latvian government has condemned all the bombings and suggested that perpetrators of the attacks want to undermine relations with Russia and spoil Latvia’s image abroad.

• Latvia said it intends to soften its citizenship laws. A Latvian spokesman said on May 6 that it was proposing changes that would make it easier for Russian children born in Latvia to win citizenship. The government will also suggest other legislative amendments simplifying the country’s complicated naturalization process. Citizenship laws have been at the heart of the bitter dispute between Latvia and Russia, whose  relations in recent months have sunk to their lowest level since the Soviet breakup in 1991. While European bodies have dismissed accusations of systematic discrimination in Latvia, they have urged Latvia to make naturalization less cumbersome. The European Union has also told Latvia that integrating Russian-speakers was critical if the country hopes to secure EU membership. The Latvian government admitted it was concerned about its EU bid, but insisted it was not caving in to Russia pressure. The proposed amendments would grant citizenship to children born after August, 1991, to non-citizens who have lived in Latvia more than five years. An estimated 25,000 children would be immediately eligible. Latvian officials conceded that the changes aren’t likely to satisfy Russia, which has long argued that all 700,000 non-citizens in Latvia should get automatic, unconditional citizenship. "No, we don’t think these changes will be enough for Russia," said government spokesman Romans Melniks. "Russia will always ask for more and more and more."

• Lithuania’s government insisted Friday it was not considering a devaluation of it’s national currency, the litas--despite growing pressure from some quarters to do it. "The government is clearly opposed to a devaluation of the currency," said Lithuanian Minister of Finance Algirdas Semeta in an interview.  "The economy does not in any way require it." Currency devaluation has been a hot issue in Lithuania for months, with powerful industrial groups calling for a devaluation to give a boost to struggling exporters. The financial sector, however, opposes a devaluation, saying it would seriously undermine investor confidence. Some say a danger sign is Lithuania’s high current account deficit, which stands at around 10 percent of GDP. Analysts point out that current account deficits were high in troubled Asian economies right before their currencies came under pressure and collapsed. Others, including the International Monetary Fund, have dismissed parallels to Asia. They say Lithuania’s currency is not overvalued, as currencies were in many Asian countries. The Lithuanian Minister of Finance said he understood the  comparisons to Asia, but argued they were not applicable. "In our case, the current account deficit is fully accountable by capital inflows, foreign investment, not by an overvalued currency," said Semeta. "While we are taking other financial policy measures to deal with it, we believe the current account deficit is a normal consequence of a country in economic transition." Lithuania also has a highly-rated currency board system—which, by law, anchors the litas to the dollar at four litas to one US dollar. Minister Semeta said the government wants to slowly phase out the currency board system, but insisted that the strict peg to the dollar would be maintained.

• Lithuania’s recent president, Algirdas Brazauskas bagged several exotic animal on a safari several weeks in South Africa, Baltic news agencies reported. Brazauskas, long an avid hunter, shot a gnu and kudu antelope. There are no outspoken animal rights groups in Lithuania, and the reformed communist is highly   unlikely to face any public criticism for participating in the shoot.

News Highlights, from April 27—May 4, 1998

• Latvia's embattled prime minister, Guntars Krasts, won a vote of confidence on Thursday by a surprisingly comfortable margin. His government has been rattled by an ongoing fued with Russia, fielding criticism from the right in Latvia that he is caving in to Russia, and from the left that he is being too uncompromising. Out of 100 seats in parliament, 58 voted with the government. The center, center-right coalition government is now faced with the task of mending relations with Russia and getting its bid for EU membership back on track. Changes to the country's controversial citizenship law will be high on the list of priorities. The government's work will be complicated by the upcoming October election, which is already heating up the political climate in the country.

• Lithuania and Latvia expressed anger at a comment by Estonian President Meri this past week that Estonia could impose visa requirements on the other two Baltics if the EU asked it to. Lithuania and Latvia—who were not invited for early talks on EU membership—said Meri's statement raised the prospect of new dividing lines between the three Baltics. In a sharply worded statement on Thursday, the Lithuanian government called Meri's words "provocative." The Estonian president's office said reactions to Meri's comments were exaggerated.

• Saying he was fed up with his inability to forge new political alliances, Estonian Prime Minister Mart Siimann said on Thursday he wanted to call early elections. He said his coalition, which controls just 37 of 101 seats in parliament, was increasingly unworkable. Without a stronger government, Siimann said the pace of development in the country could be threatened. Early elections could be called for as early as June. But some suggest Siimann is bluffing: his own party has been stung by a series of corruption scandals and could have the most to lose in any parliamentary poll .

• Great Britain's Prince Andrew will visit the Baltics states next month, according to news reports. The Prince will stop in each of the three Baltic capitals, and then travel on to St. Petersburg.

• The on-again-off-again merger of two leading Estonian banks, Hansa and Hoiu, was finally consummated this week. Together, the Hansa and Hoiu banks will constitute the largest single bank in the Baltics. Bank owners had been bickering over terms of the merger, and doubts had been raised that the deal would ever go through. But in the face of increasing competition, the banks said they felt strong pressure to lay aside their differences. There have been several bank mergers in Estonia this year, and merger talks are underway between banks in Latvia and Lithuania.