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U.S. Department of State

Diplomacy in Action

II. Country Assessment--Lithuania


U.S. Government Assistance to and Cooperative Activities with Central and Eastern Europe
Bureau of European and Eurasian Affairs
January 2007
Report
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Country Overview

Country Facts
  • Map of LithuaniaArea: 25,174 sq mi (65,200 sq km), slightly larger than West Virginia 
  • Population: 3,585,906 (July 2006 est.) 
  • Population Growth Rate: -0.3% (2006 est.) 
  • Life Expectancy: Male 69.2 yrs., Female 79.49 yrs. (2006 est.) 
  • Infant Mortality: 6.78 deaths/1,000 live births (2006 est.) 
  • Gross Domestic Product (GDP): $49.21 billion (purchasing power parity; 2005 est.) 
  • GDP Per Capita Income: $13,700 (purchasing power parity; 2005 est.) 
  • Real GDP Growth: 7.5% (2005 est.)

Overview of U.S. Government Assistance

In FY 2006, the USG provided an estimated $10.45 million in assistance to Lithuania, including:

  • $0.75 million in democratic reform programs; 
  • $0.04 million in humanitarian programs; and 
  • $9.66 million in security, regional stability, and law enforcement programs.

The last year for new SEED bilateral funding to Lithuania was FY 2000. Some additional SEED funding for public diplomacy and democracy initiatives was provided to Lithuania through FY 2003. However, during FY 2006 some implementers continued to expend SEED funds remaining from previous fiscal years, as described below.

FY 2006 Assistance Overview

U.S. STRATEGIC INTERESTS & FOREIGN POLICY PRIORITIES

Lithuania's educated population, strategic location on the Baltic Sea, and affinity for American values make it a force for economic growth and stability in and beyond the Baltic Sea region. Lithuania borders two North Atlantic Treaty Organization (NATO) allies, has contributed troops to Operation Iraqi Freedom (OIF) and Operation Enduring Freedom (OEF), and cooperates fully on international law enforcement matters. It is in the U.S. interest to promote Lithuania's economic and political prosperity by increasing commercial ties, academic and cultural exchange, and security cooperation. Lithuania is one of the U.S.'s most stalwart allies.

Despite its small size, Lithuania contributed substantially in FY 2006 to regional democracy-building and economic stability. Its troops continued to serve in Iraq and Afghanistan, accepting the challenge to lead a Provincial Reconstruction Team (PRT) in Afghanistan. Lithuania remained a positive force for democracy in the former Soviet Union through continued outreach to help bolster democratic institutions in Ukraine, Georgia, and Moldova. Lithuania also pursued a productive relationship with Russia on a range of issues. Lithuania's contribution to regional and global stability continues at a time of great economic growth. Gross Domestic Product (GDP) growth was 7.5% in 2005, and corporate profitability is among the highest in Europe. The U.S. is the eighth largest investor in Lithuania.

FOREIGN ASSISTANCE PRIORITIES

U.S. policy goals include support for the Government of Lithuania's (GOL) efforts to fight corruption, develop small businesses, and attract investment. Although Lithuania no longer receives transition assistance due to its successful implementation of democratic and economic reforms, the USG continues to work to improve Lithuania's military capabilities, strengthen border control, and provide leadership training and cultural exchange experiences through public diplomacy programs. In addition, USG projects contribute to the development of a vibrant and sustainable NGO sector, strengthening civil society, improving character education and ethics training at schools, promoting HIV/AIDS education and prevention, and enhancing governmental and civil society capacity to fight corruption. USG-sponsored programs also seek to promote tolerance and the inclusion of minority ethnic groups. Exchange programs continue to help train a cadre of Lithuanian professionals to serve as future leaders in the government and civil society.

OPERATING ENVIRONMENT

In the fifteen years following independence in 1991, Lithuania has transformed itself into a thriving democracy. In FY 2006, Lithuania continued along its steady course of democratic reform. The year witnessed the formation of a new coalition government headed by Prime Minister Gediminas Kirkilas. The Lithuanian economy continued to enjoy a period of consistent and impressive growth, with private consumption recently acting as the principal driver. The contribution of domestic market-oriented sectors, especially construction, has also increased. Lithuania continued to harmonize its regulatory environment with European Union (EU) requirements. Lithuania continued its leadership of a PRT in Afghanistan and maintained its role in bringing stability and democracy to Iraq.

FY 2006 Country Program Performance

Governing Justly and Democratically

Lithuania has taken tremendous strides to strengthen democratic institutions in the 15 years since achieving independence. The U.S. maintains a strong interest in bolstering and sustaining this transition. Greater stability, transparency, and tolerance will make Lithuania a more reliable partner for the U.S. and a better role model for aspiring democracies in the former Soviet Union.

The NGO sector continues to develop despite the lack of a philanthropic community and administrative capacities in Lithuania. The GOL has successfully worked with civil society groups to make progress in its fight against trafficking in persons (TIP).

In FY 2006, the GOL continued to address issues concerning the nation's ethnic minorities, including efforts to address the social troubles affecting Roma and to deal with historical justice issues, most prominently the fact that 90% of Lithuania's 200,000 Jews were killed in the Holocaust. Today, religious freedom is respected and a well-established ombudsman system continues to function satisfactorily.

Lithuania continued to take steps to combat corruption. Law enforcement agencies investigated a number of corruption cases involving politicians and senior civil servants. Lithuania once again ranked 46th on Transparency International's Global Corruption Perception Index 2006, with no significant year-to-year change. Lithuanian law enforcement officials have sought anti-corruption assistance and training from U.S. and European law enforcement agencies.

U.S. ASSISTANCE PRIORITIES

In FY 2006, USG assistance priorities included support for the development of a vibrant and sustainable NGO sector, strengthening civil society, improving character education and ethics training at schools, enhancing governmental and civil society's capacity to fight corruption, and promoting tolerance and inclusion of minority ethnic groups. Exchange programs continued to help train a cadre of Lithuanian professionals to serve as future leaders in government and civil society.

DESCRIPTION OF PROGRAMS, OUTPUTS, AND IMPACT

In FY 2006, USG assistance in this sector consisted of the implementation of small grant-funded projects and exchange programs which supported civil society and promoted democratic values. The USG funded travel for three U.S. character education experts to speak to regional educators and administrators in Lithuania in order to raise the profile of ethics in the community and confront corruption at an early age. The projects focused on the development of citizens of strong moral character, who are committed to ethical integrity and civic engagement in a democratic society. The USG promoted tolerance and minority inclusion by funding a seminar entitled Mainstreaming Equality and Diversity: Opening the Debate with Media, a project implemented in partnership with the Lithuanian Department on National Minorities. The event focused on the importance of media's role in minority issues and tolerance, highlighting the importance of minority rights to a diverse audience of NGO and government representatives.

The USG also supported several grassroots programs to promote tolerance and the protection of national minorities. Lithuanian alumni of USG-funded exchange programs worked to reinforce the concepts of tolerance and social inclusion among groups of disadvantaged youth, focusing on orphanages in Panevezys, Lithuania's fifth-largest city. Another alumni project raised awareness of tolerance and minority issues to promote a culture of human rights.

The USG also brought an American judge to Lithuania to confer with local justices, speak to law students, and deliver a speech at an international conference. The USG organized the conference in conjunction with a human rights NGO and the constitutional law department at a prominent Vilnius university. Conference participants discussed the practices of the U.S. system and considered how they might be applied in Lithuania. USG exchange programs continued to have a positive role in shaping Lithuania's future by sending a diverse group of young and influential Lithuanian leaders to the U.S including presidential advisers, Ministry of Foreign Affairs officials, opinion leaders in the Lithuanian media, and parliamentary officials.

Economic Growth

Lithuania's economic growth continued at a strong pace in FY 2006. Although economic policies are expected to remain consistent, an increase in the annual inflation rate to 3.5% (as of October 2006) is of concern. The GOL encountered difficulties in securing tax reforms, and Lithuania's leaders still need to increase the government's administrative capacity to take full advantage of financial assistance from the EU.

The World Bank's Doing Business in 2007 report, which assesses progress made by countries in terms of the ease of doing business, shows that Lithuania, in 16th place overall, was the highest-ranked of the 25 countries in Central and Eastern Europe covered by the report, coming in ahead of most EU-15 members.

U.S. ASSISTANCE PRIORITIES

In FY 2006, USG assistance targeted intellectual property rights (IPR), innovation, and cooperation between the commercial and research sectors of the economy. A series of events focused on patents and copyright infringement. One program also developed management tools for local authorities to promote private sector financing.

DESCRIPTION OF PROGRAMS, OUTPUTS, AND IMPACT

In FY 2006, USG assistance in this area was limited to a number of exchange programs focusing on IPR, innovation, and small business development. In support of intellectual property rights, the USG supported the training of three GOL officials at the U.S. Patent and Trademark Office (USPTO) in Washington, and helped to organize a USPTO and IPR conference in Lithuania with the participation of the GOL and local business leaders. The USG also supported a conference for GOL officials and law enforcement representatives, which shared best practices in gathering evidence, developing copyright infringement cases, prosecuting online copyright infringement cases, and examining the threat of optical disc piracy.

With the support of a USG grant to the Lithuanian Science Council, two U.S. experts participated in an international conference on entrepreneurship, which included officials from the Lithuanian business development agency and financial institutions. The conference brought together potential investors and representatives of innovative start-ups, as well as leading specialists of public institutions responsible for the development of entrepreneurship and innovation. Academic institutions and research and development institutions also contributed to the conference discussions. In addition, the grant funded an exchange program on innovation. Through a joint partnership with a U.S.-based organization specializing in cultural and business exchange programs, this assistance funded the travel of five Lithuanians to the U.S. to learn about technology transfer and entrepreneurial education. The delegation consisted of GOL officials and private sector specialists on innovation issues.

Investing in People

In the social sector, the rapid economic development of Vilnius and other major cities masks a stagnant economic situation in rural areas that have yet to experience many of the benefits of integration with the West and foreign direct investment. A difficult climate and high unemployment in rural areas has permitted a range of social problems, including alcoholism and drug addiction, to continue. Although Lithuania has developed and begun to implement numerous strategies to reduce poverty, rural unemployment, and substance abuse, social services often do not reach groups at risk for these activities.

Throughout FY 2006, the GOL continued to be active in developing strategies and programs for poverty reduction, alcohol and tobacco control, national drug control and prevention, and crime prevention. However, many of these programs have gaps, particularly in utilizing existing public health and social work resources to implement the plans regionally. Unemployed people of working age who are not enrolled in school or university - while comprising only a small portion of the total population - have committed two-thirds of the recorded crimes in the past few years.

As Eastern Europe faces a rising prevalence of HIV, Lithuania seeks to remain one of the leaders of the region in HIV/AIDS prevention. Although the HIV/AIDS rates in Lithuania are fairly low, the situation in the neighboring countries (e.g. Russia's Kaliningrad enclave) remains worrisome. One of the most problematic aspects of the AIDS issue in Lithuania is discrimination against those infected with HIV.

U.S. ASSISTANCE PRIORITIES

In FY 2006, the USG assistance priority in this sector was to support Lithuania's commitment address the spread of HIV/AIDS.

DESCRIPTION OF PROGRAMS, OUTPUTS, AND IMPACT

A USG-funded training program focused on local level efforts of HIV/AIDS prevention, including the encouragement of local public health authorities to tailor programs to specific regional needs. The program worked to expand the capacity of public health authorities to implement programs and action plans targeted at the prevention and control of HIV/AIDS in their local environment. The project funded the travel of a U.S. expert to lecture at a number of seminars and training sessions in five Lithuanian towns. After the seminars, participants submitted drafts of local programs and action plans targeted at HIV/AIDS prevention and control.

Peace and Security

Lithuania plays an active role in promoting democracy and free markets in Europe and beyond. It has been a fixture in the Global War on Terror (GWOT). Although Lithuania depended on security assistance only a few years ago, with the support of USG assistance it is now contributing to international security by heading a PRT in Afghanistan and working to promote stability in Iraq. Lithuania's progress is a model for new NATO members. Lithuania joined NATO in April 2004 and contributes actively to Alliance activities such as peacekeeping and counter-terrorism. By 2015, the country expects to expand its capabilities to include an entire brigade task force consisting of four maneuver battalions and associated support units able to be deployed alongside NATO forces for an Article 5 operation. Lithuania is also an enthusiastic participant in the activities of the OSCE and numerous other international organizations committed to promoting security.

U.S. ASSISTANCE PRIORITIES

In FY 2006, USG security assistance to the Lithuanian Armed Forces supported the continued professionalization of senior and mid-level leaders, training in logistics, civil military operations, and special operations to prepare Lithuania for its growing NATO responsibilities. Other USG security assistance focused on the transformation of the military from a static territorial defense force to a deployable, NATO-compatible military. The USG also continued to build the capacity of Lithuania to control its borders and prevent and interdict shipments of dangerous items and technologies.

DESCRIPTION OF PROGRAMS AND ACTIVITIES

USG programs in FY 2006 continued to provide training to Lithuanian law enforcement agencies and to ensure U.S. influence in the development of Lithuania's Armed Forces. A USG grant funded the attendance of officers and noncommissioned officers (NCOs) at courses in the U.S. Additionally, the USG placed heavy emphasis on Lithuanian attendance in logistics, air defense, and intelligence captains career courses, which worked to develop a gifted cadre of young officers with a strong foundation in U.S. and NATO doctrine. This training is critical for the transformation of the Lithuanian military into an agile, deployable force that can help support U.S. and NATO operations. In order to support Lithuania's ongoing modernization, maintenance of a PRT in Afghanistan, and participation in GWOT, OEF and OIF operations, USG foreign military financing programs worked to transform the Lithuanian military from a static territorial defense force to a deployable, NATO-compatible military. The USG also provided Lithuanian law enforcement with training, support, and equipment, including funded all-terrain vehicles, night-vision goggles, and thermal imaging equipment.

OUTPUTS

A USG grant funded over 50 officers and NCOs' attendance at nearly 100 courses in the US. The USG conducted three highly successful mobile training team events for over 100 Lithuanians. Two Lithuanian officers graduated from the U.S. Air Force and Naval Academies, three officers graduated from Staff College, and two Lithuanian Senior NCOs graduated from the Sergeant's Major Academy. Nearly 40 junior officers and NCOs participated in specialty training in the fields of logistics, special forces operations, intelligence, and explosives ordnance disposal.

Other USG security assistance funded individual and collective nuclear biological chemical nerve agent antidote kits, radioactivity meters, training simulators, night vision devices with helmet adapters, extension of support for a joint conflict and tactical simulation center, a high-mobility multi-purpose wheeled vehicle, a standardized integrated command post system, rigid wall shelters, hand-held radios and communications security equipment, night vision devices and thermal imagers, aviation night-vision devices, and miniature hand-launched unmanned aerial vehicles.

The USG trained Lithuanian customs service personnel on undercover export investigation and industry outreach, and sponsored a visit to the U.S. by customs and border guard personnel on international rail interdiction. In addition, USG supported an assessment of Lithuania's nuclear and radiological non-proliferation programs, as well as the maintenance of equipment previously donated for detection and interdiction.

USG exchange programs sent a number of Lithuanians to the U.S. in the areas of law enforcement and security. The head of the anti-trafficking unit of the Lithuanian criminal police bureau participated in an international visitor program on combating TIP. In addition, an adviser from the Lithuanian State Security Department participated in a visitor program on U.S.-European security issues.

PROGRAM PERFORMANCE/IMPACT

In FY 2006, USG security assistance programs continued to facilitate significant U.S. influence in the development of Lithuania's Armed Forces and provide a vehicle for cooperation with military leadership. Programs were key to Lithuania's transformation to a U.S.-style expeditionary force that is deployable, sustainable, and fully capable of operating alongside U.S. and NATO coalition forces. Through programs which directly and indirectly supported the over 200 Lithuanian soldiers deployed in support of OIF and OEF, USG assistance supported and strengthened coalition partners' efforts to contribute to international security.

Lithuania continued to place graduates from mid-level and senior-level courses in key command and staff positions throughout the military, resulting in the introduction of U.S. doctrine, military philosophies, and ideals at the highest levels of Lithuanian forces. The emphasis placed on attendance at the logistics, air defense, and intelligence captains career courses continued to develop a gifted cadre of young officers with a strong foundation in U.S. and NATO doctrine. This training was critical for the transformation of the Lithuanian military into an agile, deployable force that can help support U.S. and NATO operations.

Bilateral law enforcement cooperation continued to have great success, a result of several years of USG-funded legal reform and law enforcement training. The USG successfully cooperated with the Lithuanian authorities in numerous investigations involving fraud, narcotics trafficking, and other crimes. Program alumni also continued to have a significant impact on legal reform and law enforcement in key areas such as corruption. One alumnus, the Executive Director of the Lithuanian Chapter of Transparency International, continued his work as an author and outspoken advocate for anti-corruption policies.

FY 2006 Funds Budgeted for U.S. Government Assistance to Lithuania [PDF format]



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