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Week in Lithuania. Government asks MPs to allow it to borrow funds for defence spending target

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The Lithuanian government has asked the parliament to allow it to borrow funds to increase defence funding and thus meet NATO’s 2 per cent of GDP spending target.

A bill giving the go-ahead for the Finance Ministry to use borrowed funds to finance NATO-related financial commitments passed the first reading on Tuesday and will require two more readings to be adopted. It was said when the 2018 budget was being planned that Lithuania’s defence spending would reach 2.006 percent of GDP, but the rate might be lower because of the country’s faster-than-expected growth.

According to an estimation, an additional 18 million euros will have to be allocated for the defence budget this year if the economic growth forecasts are not revised in the fall. Lithuania’s current budget earmarks 873 million euros for defence this year.

Klaipeda council votes to turn to court

The City Council of Klaipeda voted on Thursday, September 13, to turn to court over the impeachment of Viačeslav Titov, a councillor representing the Union of Russians in Lithuania, who has accused Lithuanian partisan commander Adolfas Ramanauskas-Vanagas of killing innocent civilians.

The mayor earlier told the council that the vote would be on whether to ask a court to give a legal assessment of information collected by a special impeachment commission, not on impeachment proceedings. If the court rules that Titov did breach his oath, the council will need the backing of at least two thirds of council members to strip Titov of his mandate.

Skvernelis back among top three candidates

Prime Minister Saulius Skvernelis is back on the list of the top three potential candidates for next spring’s presidential election in Lithuania, according to an opinion poll released by Delfi.lt on Thursday, September 13. Some 10.7 per cent of respondents said in late August they would vote for Skvernelis.

Economist Gitanas Nausėda continues to top the list of people seen as potential presidential candidates with 19.7 per cent, followed by Kaunas Mayor Visvaldas Matijošaitis in second place with 14.4 per cent. Nausėda topped a similar poll in June with 20.6 per cent, followed by Matijošaitis with 10 per cent and former diplomat Vygaudas Ušackas with 6.7 per cent. In the latest poll, Ušackas fell to fourth position, followed by MP Ingrida ŠImonytė at number five.

Bank association’s head on Luminor deal

US investment company Blackstone’s decision to buy a majority stake in the Baltic bank Luminor shows confidence in the Baltic banking system and may encourage further interest from major private equity funds in investing in the region, the president of the Lithuanian Banks’ Association (LBA) said on Thursday, September 13.

Luminor has announced that a consortium led by private equity funds managed by Blackstone is buying a 60 per cent stake in the Baltic bank for 1 billion euros. Luminor’s current owners, Nordea and DNB, will each retain 20 per cent of shares in the Baltic bank and will maintain their presence on the board of directors.

Ruling bloc moves to lower referendum threshold

Lithuania’s ruling parties propose to lower the referendum threshold for the entire Chapter 1 of the Constitution. The ruling bloc tabled the proposal after the parliament on Tuesday, September 11, upheld President Dalia Grybauskaitė’ veto of amendments lowering the yes-vote threshold for a dual citizenship referendum.

Under the new draft amendments to the Law on Referendum, a decision on amending an article of Chapter 1 and Chapter 14 is deemed as adopted if at least two-fifths of all citizens having the right of vote say “yes” in a referendum. Currently, approval from more than a half of eligible citizens is needed to amend an article of the two chapters, which have a higher level of protection.

Government mulls car tax

The Lithuanian government does not propose to increase the taxation of real estate, at least not for now, but it may ask the Seimas to tax polluting vehicles. Such a tax could be imposed, but incentives for buying less polluting cars would have to be put in place as well, Deputy Finance Minister Loreta Maskaliovienė said on Wednesday, September 12.

Prime Minister Saulius Skvernelis said in August that the government might consider measures to encourage motorists to choose less-polluting vehicles, but added that it was not discussing a blanket tax on cars. The parliament last spring did not back the government’s proposal to tax second and further residential properties owned by one individual at a rate of 0.3 per cent.

Cultural workers to stage protest to demand higher salaries

Creative and cultural workers will next week stage a protest outside the government building in Vilnius to press their demands for a larger increase in salaries. The protest will be held after the Culture Ministry ignored demands to raise salaries in the sector by 150 euros as early as next year and committed to increasing them by 21 euros on average, allocating 3.5 million euros for that purpose, Vida Garunkštytė, chairwoman of the Committee on Culture at Lithuania’s Tripartite Council, said. The sector’s salaries were last increased in 2016, but that pay rise has already been eaten away by inflation, she said.

Finance ministry raises GDP growth forecasts

The Lithuanian Finance Ministry has revised upwards its forecasts for the country’s GDP growth this year and next year. The ministry expects the economy to expand by 3.4 per cent in 2018, by 2.9 per cent in 2019 and by 2.5 per cent in 2020. The forecasts are up from the ministry’s estimates of 3.2 per cent, 2.8 per cent and 2.5 per cent, respectively, published in March.

Plane makes emergency landing in Vilnius

A Boeing 757 plane made an emergency landing in Vilnius on Tuesday, September 11, after a male passenger died aboard the aircraft. The Boeing 757 landed in Vilnius Airport at 3:23 p.m. It was met by an emergency medical crew, but the man was already dead. The plane of Privilege Style, a Spanish charter airline, was on its way from Zaragoza to St. Petersburg in Russia.

MPs uphold presidential veto

The Lithuanian parliament upheld on Tuesday, September 11, President Dalia Grybauskaitė’ veto of a legislative package paving the way for an overhaul of the network of hospitals and other healthcare facilities. In a vote of 117 to none and two abstentions, the Seimas decided to consider the package it had passed during the spring session as not adopted. Grybauskaitė sent the package to the parliament for reconsideration, citing its incompatibility with the Constitution as the reason.

MPs back presidential veto

The Lithuanian parliament upheld on Tuesday, September 11, President Dalia Grybauskaitė’ veto of amendments lowering the yes-vote threshold for a dual citizenship referendum. The Seimas last spring changed the Law on Referendum to require fewer votes for amending Article 12 of Chapter 1 of the Constitution, which speaks about Lithuanian citizenship.

Currently, more than half of all citizens having the right of vote must say yes in a referendum to amend any article of Chapter 1. The Seimas had lowered the threshold for a referendum on citizenship to more than 50 per cent of all voters who turn out, but no fewer than a third of all citizens with the right to vote.


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