For the most current version of this Note, see Background Notes A-Z.


Republic of Lithuania

Area: 65,200 sq. km. (26,080 sq. mi.); about the size of West Virginia.
Cities: Capital--Vilnius (pop. 553,373); Kaunas (376,575); Klaipeda (192,498); Siauliai (133,528); Panevezys (119,417).
Terrain: Lithuania's fertile, central lowland plains are separated by hilly uplands created by glacial drift. A total of 758 rivers (many are navigable) and 2,833 lakes cover the landscape. The coastline is 90 km. (56 mi.) long. Land use--53% arable land, 30% forest and woodland, 4% water, 13% other. With four distinct seasons, the climate is humid continental, with a moderating maritime influence from the Baltic Sea. January temperatures average -5 degrees C (23 degrees F); July, 17 degrees C (63 degrees F). Annual precipitation averages 62 centimeters (24.4 in.).

Nationality: Noun and adjective--Lithuanian(s).
Population: 3.476 million.
Growth rate: -2.5%. Birth rate--9.1/1,000. Death rate--11.6/1,000.
Ethnic groups: Lithuanian 83.5%, Poles 6.7%, Russians 6.3%, Belarusians 1.2%, Ukrainians .7% Jews 0.1% others 1.5%.
Religions: Catholic (70%), Orthodox (3%), Protestant (1%), Old Believers (0.8%), Jewish (0.1%).
State language: Lithuanian. A minority speaks Russian and Polish.
Education: Years compulsory--9. Literacy--99%.
Health: Infant mortality rate--7.8/1,000. Life expectancy--66 yrs. male, 77 yrs. female.
Work force (2002, second quarter): 1.73 million: Manufacturing industry 18.3%; agriculture 17.1%; wholesale and retail trade 15.5%; construction 6.3%; transport 6.3%; public administration and defense 5.1%.

Type: Parliamentary Democracy.
Constitution: On October 25, 1992 Lithuanians ratified a new constitution, which officially was signed on November 6 that year.
Branches: Executive--popularly elected president (chief of state); prime minister (head of government). Legislative--Seimas (Parliament-141 members, 4-year term). Judicial--Constitutional Court, Supreme Court, and Highest Administrative Court.
Administrative regions: 10 counties and 60 municipalities.
Principal political parties/coalitions: Social Democratic Party 47, New Union 26, Liberal Union 23, Liberal Democratic Party 9, Conservative Party 9, Peasant and New Democracy Party 7.
Suffrage: 18 years, universal.
National government budget (2002): $2.8 billion (exch. rate 3.5 Lt=$1).

If a scroll bar appears below the following table, swipe the table to move left/right of the dashed line.
Flag: flag of lithuania

GDP (2001): $12 billion.
Annual GDP growth: 5.9%.
GDP per capita: $3,437.
Inflation (2001): 2%.
Unemployment (2002, second quarter): 13%.
Major sectors of the economy: Manufacturing 23%, wholesale and retail trade 15.2%, transport and communications 13.6%.
Trade: Exports--$4.6 billion: mineral products 23.4%, textiles and textile articles 16.3%; agricultural and food products 12.4%; vehicles, aircraft, vessels 9.2%; machinery and mechanical appliances 10.7%; wood and paper products 6.6%. Major partners--United Kingdom 15.7%, Russia 13.4%, Germany 10.9%, Belarus 3.8%, Latvia 9.4%, Poland 3.9%, Ukraine 2.8%. Imports--$6.25 billion: mineral products 18%; machinery and mechanical appliances 16.8%; vehicles, aircraft, vessels 16.2%; chemical products 9%; textiles and textile articles 8.3%. Major partners--Russia 21.6%, Germany 17.8%, Poland 4.7%, United Kingdom 3.6%, Ukraine 1.5%, Belarus 1.6%, Latvia 1.6%.

The largest and most populous of the Baltic states, Lithuania is a generally maritime country with 60 miles of sandy coastline, of which only 24 miles face the open Baltic Sea. Lithuania's major warm-water port of Klaipeda lies at the narrow mouth of Kursiu Gulf, a shallow lagoon extending south to Kaliningrad. The Nemunas River and some of its tributaries are used for internal shipping (In 2000, 89 inland ships carried 900,000 tons of cargo, which is less than 1% of the total goods traffic). Between 56.27 and 53.53 latitude and 20.56 and 26.50 longitude, Lithuania is glacially flat, except for morainic hills in the western uplands and eastern highlands no higher than 300 meters. The terrain is marked by numerous small lakes and swamps, and a mixed forest zone covers 30% of the country. The growing season lasts 169 days in the east and 202 days in the west, with most farmland consisting of sandy- or clay-loam soils. Limestone, clay, sand, and gravel are Lithuania's primary natural resources, but the coastal shelf offers perhaps 10 million barrels' worth of oil deposits, and the southeast could provide high yields of iron ore and granite. According to some geographers, Lithuania's capital, Vilnius, lies at the geographical center of Europe.

The earliest evidence of inhabitants in present-day Lithuania dates back to 10,000 BC. Between 3,000-2,000 BC, the cord-ware culture people spread over a vast region of eastern Europe, between the Baltic Sea and the Vistula River in the west and the Moscow-Kursk line in the east. Merging with the indigenous population, they gave rise to the Balts, a distinct Indo-European ethnic group whose descendants are the present-day Lithuanian and Latvian nations and the now extinct Prussians. The name "Lietuva", or Lithuania, might be derived from the word "lietava," for a small river, or "lietus," meaning rain (or land of rain).

Lithuanians are neither Slavic nor Germanic, although the union with Poland and Germanic and Russian colonization and settlement left cultural and religious influences. This highly literate society places strong emphasis upon education, which is free and compulsory until age 16. Most Lithuanians and ethnic Poles belong to the Roman Catholic Church; Orthodoxy is the largest non-Catholic denomination.

Enduring several border changes, Soviet deportations, a massacre of its Jewish population, and German and Polish repatriations during and after WWII, Lithuania has maintained a fairly stable percentage of ethnic Lithuanians (from 79.3% in 1959 to 83.5% in 2002). Lithuania's citizenship law and constitution meet international and OSCE standards, guaranteeing universal human and civil rights.

The Lithuanian language still retains the original sound system and morphological peculiarities of the prototypal Indo-European tongue and therefore is fascinating for linguistic study. Between 400-600 AD, the Lithuanian and Latvian languages split from the Eastern Baltic (Prussian) language group, which subsequently became extinct. The first known written Lithuanian text dates from a hymnal translation in 1545. Written with the Latin alphabet, Lithuanian has been the official language of Lithuania again since 1989. The Soviet era had imposed the official use of Russian, so most Lithuanians speak Russian as a second language while the resident Slavic populace generally speaks Russian or Polish as a first language.

The first written mention of Lithuania occurs in 1009 AD, although many centuries earlier the Roman historian Tacitus referred to the Lithuanians as excellent farmers. Spurred by the expansion into the Baltic lands of the Germanic monastic military orders (the Order of the Knights of the Sword and the Teutonic Order) Duke Mindaugas united the lands inhabited by the Lithuanians, the Samogitians, Yotvingians, and Couranians into the Grand Duchy of Lithuania (GDL) in the 1230s-40s. In 1251 Mindaugas adopted Catholicism and was crowned King of Lithuania on July 6, 1253; a decade later, civil war erupted upon his assassination until a ruler named Vitenis defeated the Teutonic Knights and restored order.

From 1316 to 1341 Vytenis' brother and successor, Grand Duke Gediminas, expanded the empire as far as Kiev against the Tatars and Russians. He twice attempted to adopt Christianity in order to end the GDL's political and cultural isolation from western Europe. To that purpose, he invited knights, merchants, and artisans to settle in Lithuania and wrote letters to Pope John XXII and European cities maintaining that the Teutonic Order's purpose was to conquer lands rather than spread Christianity. Gediminas' dynasty ruled the GDL until 1572. In the 1300s through the early 1400s, the Lithuanian state expanded eastward. During the rule of Grand Duke Algirdas (1345-77), Lithuania almost doubled in size. The 1385 Kreva Union signed by the Grand Duke of Lithuania Jogaila (ruled in 1377-81 and 1382-92) and the Queen of Poland Jadwyga intensified Lithuania's economic and cultural development, orienting it toward the West.

Lithuania's independence under the union with Poland was restored by Grand Duke Vytautas. During his rule (1392-1430) the GDL turned into one of the largest states in Europe, encompassing present-day Belarus, most of Ukraine, and the Smolensk region of western Russia. Led by Jogaila and Vytautas, the united Polish-Lithuanian army defeated the Teutonic Order in the Battle of Tannenberg (Grunewald or Zalgiris) in 1410, terminating the medieval Germanic drive eastward.

The 16th century witnessed a number of wars against the growing Russian state over the Slavic lands ruled by the GDL. Coupled with the need for an ally in those wars, the wish of the middle and petty gentry to obtain more rights already granted to the Polish feudal lords drew Lithuania closer to Poland. The Union of Lublin in 1569 united Poland and Lithuania into a commonwealth in which the highest power belonged to the Sejm of the nobility and its elected King who also was the Grand Duke of Lithuania. Mid-16th century land reform strengthened serfdom and yet promoted the development of agriculture owing to the introduction of a regular three-field rotation system. The 16th century saw a more rapid development of agriculture, growth of towns, spread of ideas of humanism and the Reformation, and book printing. The emergence of Vilnius University in 1579 and the Lithuanian Codes of Law (the Statutes of Lithuania) stimulated the development of culture both in Lithuania and in neighboring countries.

The Polish-Lithuanian Republic was weakened by the rising domination of the big magnates, and the 16th-18th century wars against Russia and Sweden over Livonia, Ukraine, and Byelorussia. The end of the 18th century witnessed three divisions of the Commonwealth by Russia, Prussia, and Austria; in 1795 most of Lithuania became part of the Russian empire. Attempts to restore independence in the uprisings of 1794, 1830-31, and 1863 were suppressed and followed by a tightened police regime, increasing Russification, the closure of Vilnius University in 1832, and the 1864 ban on the printing of Lithuanian books in traditional Latin characters.

Because of his proclamation of liberation and self-rule, many Lithuanians gratefully volunteered for the French Army when Napoleon occupied Kaunas in 1812 during the fateful invasion of Russia. After the war, Russia imposed extra taxes on Catholic landowners and enserfed an increasing number of peasants. A market economy slowly developed with the abolition of serfdom in 1861. Lithuanian farmers grew stronger and an increase in the number of intellectuals of peasant origin led to the growth of a Lithuanian national movement. In German-ruled East Prussia, also called Lithuania Minor, K�nigsberg or Kaliningrad, Lithuanian publications were printed in large numbers and then smuggled into Russian-ruled Lithuania. The most outstanding leaders of the national liberation movement were J. Basanavicius and V. Kudirka. The ban on the Lithuanian press finally was lifted in 1904.

During WW I, the German Army occupied Lithuania in 1915, and the occupation administration allowed a Lithuanian Conference to convene in Vilnius in September 1917. The conference adopted a resolution demanding the restoration of an independent Lithuanian state and elected the Lithuanian Council, a standing body chaired by Antanas Smetona. On February 16, 1918, the council declared Lithuania's independence. The years 1919-20 witnessed Lithuania's War for Independence against three factions--the Red Army, which in 1919 controlled territory ruled by a Bolshevist government headed by V. Kapsukas; the Polish Army; and the Bermondt Army, composed of Russian and German troops under the command of the Germans. Lithuania failed to regain the Polish-occupied Vilnius region.

In the Moscow Treaty of July 12, 1920, Russia recognized Lithuanian independence and renounced all previous claims to it. The Seimas (parliament) of Lithuania adopted a constitution on August 1, 1922, declaring Lithuania a parliamentary republic, and in 1923 Lithuania annexed the Klaipeda region, the northern part of Lithuania Minor. By then, most countries had recognized Lithuanian independence. After a military coup on December 17, 1926, Nationalist party leader Antanas Smetona became president and gradually introduced an authoritarian regime.

Lithuania's borders posed its major foreign policy problem. Poland's occupation (1920) and annexation (1922) of the Vilnius region strained bilateral relations, and in March 1939 Germany forced Lithuania to surrender the Klaipeda region. Radical land reform in 1922 considerably reduced the number of estates, promoted the growth of small and middle farms, and boosted agricultural production and exports, especially livestock. In particular, light industry and agriculture successfully adjusted to the new market situation and developed new structures.

The inter-war period gave birth to a comprehensive system of education with Lithuanian as the language of instruction and the development of the press, literature, music, arts, and theater. On August 23, 1939, the Molotov-Ribbentrop Pact pulled Lithuania first into the German sphere of influence and then brought Lithuania under Soviet domination following the Soviet-German agreement of September 28, 1939. Soviet pressure and a complicated international situation forced Lithuania to sign an agreement with the U.S.S.R. on October 10, 1939, by which Lithuania was given back the city of Vilnius and the part of Vilnius region seized by the Red Army during the Soviet-Polish war. In return, some 20,000 Soviet soldiers were deployed in Lithuania.

On June 14, 1940, the Soviet Government issued an ultimatum to Lithuania, demanding the formation of a new Lithuanian government and permission to station additional Red Army troops. Lithuania succumbed to the Soviet demand, and 100,000 Soviet troops moved into the country the next day. Arriving in Kaunas, the Soviet Government's special envoy began implementing the plan for Lithuania's incorporation into the U.S.S.R. On June 17 the alleged People's government, headed by J. Paleckis, was formed. Rump parliamentary elections were held one month later, and Lithuania was proclaimed a Soviet Socialist Republic on August 3. Totalitarian rule was established, Sovietization of the economy and culture began, and Lithuanian state employees and public figures were arrested and exiled to Russia. During the mass deportation campaign of June 14-18, 1941, about 7,439 families (12,600 people) were deported to Siberia without investigation or trial; 3,600 people were imprisoned and more than 1,000 massacred.

A Lithuanian revolt against the U.S.S.R. quickly followed the outbreak of the war against Germany in 1941. The rebels declared the restoration of Lithuania's independence and actively operated a provisional government, without German recognition, from June 24 to August 5. Lithuania became part of the German occupational administrative unit of Ostland. People were repressed and taken to forced labor camps in Germany. The Nazis and local collaborators deprived Lithuanian Jews of their civil rights and massacred about 200,000 of them. Together with Soviet partisans, supporters of independence put up a resistance movement to deflect Nazi recruitment of Lithuanians to the German army.

The Red Army forced the Germans out of Lithuania in 1944 and reestablished control. Sovietization continued with the arrival of communist party leaders to create a local party administration. The mass deportation campaigns of 1941-52 exiled 29,923 families to Siberia and other remote parts of the Soviet Union. Official statistics state that more than 120,000 people were deported from Lithuania during this period, while some sources estimate the number of political prisoners and deportees at 300,000. In response to these events, an estimated several tens of thousands of resistance fighters participated in unsuccessful guerilla warfare against the Soviet regime from 1944-53. Soviet authorities encouraged immigration of other Soviet workers, especially Russians, as a way of integrating Lithuania into the Soviet Union and of fomenting industrial development.

Until mid-1988, all political, economic, and cultural life was controlled by the Lithuanian Communist Party (LCP). The political and economic crisis that began in the U.S.S.R. in the mid-1980s also affected Lithuania, and Lithuanians as well as other Balts offered active support to Gorbachev's program of social and political reforms. Under the leadership of intellectuals, the Lithuanian reform movement "Sajudis" was formed in mid-1988 and declared a program of democratic and national rights, winning nationwide popularity. Inspired by Sajudis, the Lithuanian Supreme Soviet passed constitutional amendments on the supremacy of Lithuanian laws over Soviet legislation, annulled the 1940 decisions on proclaiming Lithuania a part of the U.S.S.R., legalized a multi-party system, and adopted a number of other important decisions. A large number of LCP members also supported the ideas of Sajudis, and with Sajudis support, Algirdas Brazauskas was elected First Secretary of the Central Committee of the LCP in 1988. In December 1989, the Brazauskas-led LCP split from the CPSU and became an independent party, renaming itself in 1990 the Lithuanian Democratic Labor Party.

In 1990, Sajudis-backed candidates won the elections to the Lithuanian Supreme Soviet. On March 11, 1990, its chairman Vytautas Landsbergis proclaimed the restoration of Lithuanian independence, formed a new Cabinet of Ministers headed by Kazimiera Prunskiene, and adopted the Provisional Fundamental Law of the state and a number of by-laws. The U.S.S.R. demanded revocation of the act and began employing political and economic sanctions against Lithuania as well as demonstrating military force. On January 10, 1991, U.S.S.R. authorities seized the central publishing house and other premises in Vilnius and unsuccessfully attempted to overthrow the elected government by sponsoring a local "National Salvation Committee." Three days later the Soviets forcibly took over the TV tower, killing 14 civilians and injuring 700. During the national plebiscite in February more than 90% of those who took part in the voting (76% of all eligible voters) voted in favor of an independent, democratic Lithuania. Led by the tenacious Landsbergis, Lithuania's leadership continued to seek Western diplomatic recognition of its independence. Soviet military-security forces continued forced conscription, occasional seizure of buildings, attacking customs posts, and sometimes killing customs and police officials.

During the August 19 coup against Gorbachev, Soviet military troops took over several communications and other government facilities in Vilnius and other cities, but returned to their barracks when the coup failed. The Lithuanian Government banned the Communist Party and ordered confiscation of its property.

Despite Lithuania's achievement of complete independence, sizable numbers of Russian forces remained on its territory. Withdrawal of those forces was one of Lithuania's top foreign policy priorities. Lithuania and Russia signed an agreement on September 8, 1992, calling for Russian troop withdrawals by August 31, 1993, which took place on time.

Lithuania is a multi-party, parliamentary democracy. President Valdas Adamkus, who took office in February 1998, is the head of state. The president is elected directly for 5 years, is also commander in chief overseeing foreign and security policy, and nominates the prime minister and his cabinet and a number of other top civil servants. The next presidential election is scheduled for December 2002.

The parliament (Seimas) has 141 members that are elected for a 4-year term. About half of the members are elected in single constituencies (71), and the other half (70) are elected in the nationwide vote by party lists. A party must receive at least 5% of the national vote to be represented in the Seimas. The last parliamentary elections took place in October 2000.

All major parties have declared their support for Lithuania's membership in NATO and the European Union (EU). The government's stated goal is to receive an invitation to join NATO in 2002, to complete negotiations with the EU in 2002, and join the EU in 2004.

Since 1991, Lithuanian voters have shifted from right to left and back again, swinging between the Conservatives, led by Vytautas Landsbergis, and the Labor (former communist) Party, led by former president Algirdas Brazauskas. This pattern was broken in the October 2000 elections when the Liberal Union and New Union parties won the most votes and were able to form a centrist ruling coalition with minor partners. President Adamkus played a key role in bringing the new centrist parties together. The leader of the center-left New Union (also known as the Social Liberal party), Arturas Paulauskas, became the Chairman of the Seimas. The government of liberal Rolandas Paksas got off to a rocky start and collapsed within 7 months. In July 2001, the center-left New Union party forged an alliance with the left-wing Social Democratic Party and formed a new cabinet under former president Algirdas Brazauskas.

The cabinet of Algirdas Brazauskas is made up mostly of nonparty technocrats and has emphasized the need for financial discipline. The government remains focused on NATO and EU membership goals.

Principal Government Officials
President--Valdas Adamkus
Prime Minister--Algirdas Brazauskas
Foreign Affairs--Antanas Valionis
Defense--Linas Linkevicius
Interior--Juozas Bernatonis
Justice--Vytautas Markevicius
Finance--Dalia Grybauskaite
Economics--Petras Cesna
Transportation--Zigmantas Balcytis
Agriculture--Jeronimas Kraujelis
Education and Science--Algirdas Monkevicius
Health--Konstantinas Dobrovolskis
Social Security and Labor--Vilija Blinkeviciute
Culture--Roma Dovydeniene
Environment--Arunas Kundrotas
Seimas Chairman--Arturas Paulauskas

Lithuania maintains an embassy in the United States at 2622 - 16th Street, Washington DC, 20009 [tel: (202) 234-5860].

The Soviet era brought Lithuania intensive industrialization and economic integration into the U.S.S.R., although the level of technology and state concern for environmental, health, and labor issues lagged far behind Western standards. Urbanization increased from 39% in 1959 to 68% in 1989. From 1949-52 the Soviets abolished private ownership in agriculture, establishing collective and state farms. Production declined and did not reach pre-war levels until the early 1960s. The intensification of agricultural production through intense chemical use and mechanization eventually doubled production but created additional ecological problems. This changed after independence, when farm production dropped due to difficulties in restructuring the agricultural sector.

The transportation infrastructure inherited from the Soviet period is adequate and has been generally well maintained since independence. Lithuania has one ice-free seaport with ferry services to German, Swedish, and Danish ports. There are operating commercial airports with scheduled international services at Vilnius, Kaunas, and Klaipeda. The road system is good. Border facilities at checkpoints with Poland were significantly improved by using EU funds, but long waits are still a frequent phenomenon. Telecommunications have improved greatly since independence as a result of heavy investment. The Telecom company will operate as a monopoly until the end of 2002, but there are a number of cell phone companies to provide competition.

The economy of independent Lithuania had a slow start, as the process of privatization and the development of new companies slowly moved the country from a command economy toward the free market. By 1998, the economy had survived the early years of uncertainty and several setbacks, including a banking crisis, and seemed poised for solid growth. However, the collapse of the Russian ruble in August 1998 shocked the economy into negative growth and forced the reorientation of trade from Russia toward the West. Since the Russia crisis, the focus of Lithuania's export markets has shifted from East to West. In 1997, exports to former Soviet states were 45% of total Lithuanian exports. Today, exports to the East are only 19% of the total, while exports to EU members and candidates are 71%. The government of 1999, which was led by Prime Minister Kubilius, managed to control raging budget deficits in the midst of the crisis, and all successor governments have maintained that fiscal discipline. Privatization is now largely complete, with 75% of the economy now in private hands. The one exception is the energy sector, with gas company privatization behind schedule and energy company privatization stalled altogether.

The year 2001 was a good one for the Lithuanian economy. The 5.9% growth in GDP went beyond even the most optimistic expectations, despite the slower developments in the neighboring markets after the September 11th terrorist attacks in New York and Washington, D.C. The growth in Lithuania was mainly driven by private consumption and exports. Growth was strongest in construction, financial intermediation, and processing and light industries. Inflation was low, the growth of the external account deficit stabilized, and the state finances improved noticeably with a fiscal deficit of 1.5% of GDP. Exports continued to be the driving force of Lithuania's economic growth. Recently, they surpassed the pre-crisis levels ($3.7 billion in 1998 versus $4.6 billion in 2001). The contribution of domestic market oriented sectors, especially construction, also was increasing.

Lithuania's economic situation has continued to improve during the first two quarters of 2002. During the first and second quarters of 2002, GDP grew at 4.4% and 6.9%, respectively. Economic growth continued, and inflation was low. Progress also was achieved in the areas of privatization and deregulation. Weaknesses remain in public policy development and structural and agricultural reforms.

Manufacturing is Lithuania's largest economic sector, making up 23% of the GDP. It is followed by wholesale and retail sales, which comprise 15 and 8.4%, respectively. The privatization of major state enterprises is expected to be completed in the next couple of years. In 2001, the private sector contribution to GDP increased from about 72% to about 75%. The share of employees in the private sector rose to about 70%. Recently, the Government of Lithuania completed banking sector privatization. 89% of this sector is now controlled by foreign capital. The privatization of the national gas and power companies "Lietuvos Dujos" (Lithuanian Gas) and "Lietuvos Energija" (Lithuanian Energy) also is underway. The privatization of the national airline is temporarily on hold, while the privatization of "Lithuanian Railways" is postponed until about 2003.

Inflation continues to be low. Annual inflation in 2001 stood at 2.0%, however, at the end of the second quarter of 2002, 0.5% annual deflation was recorded. The deflation has been the result of sharp competition among retail trade chains and appreciation of the local currency against the U.S. dollar.

The minimum wage has not changed since June 1998 and stands at $107.50 per month, well below the poverty threshold. The average wage has hardly changed since the economic recession in 1999 and stands at $241 per month.

Exports to the United States make up 3.1% of all Lithuania's exports, and imports from the United States comprise 3.4% of total imports to Lithuania. Foreign direct investment (FDI) in Lithuania reached 1.3 billion Litas at the end of June 2002, which represented an increase of 17% compared to the same period in the previous year. As of September 30, 2002, the United States was the third- largest investor (10.2%) in Lithuania, behind Denmark and Sweden. In the second quarter of 2002, the current account deficit stood at 8.5% of GDP; 87% of it was financed by foreign direct investment.

On February 2, 2002, the government re-pegged the Litas from the U.S. dollar to the Euro at the rate of 3.4528 Litas for 1 Euro. The re-peg, which went on smoothly, reflects a change in trade orientation and is to help Lithuania prepare for the European Monetary Union. However, with the appreciation of local currency against the U.S. dollar, production costs of our enterprises have been decreasing, and competitiveness increasing.

Lithuania's defense system is based on the concept of "total and unconditional defense" mandated by Lithuania's national security strategy. The goal of Lithuania's defense policy is to prepare their society for general defense and to integrate Lithuania into Western security and defense structures. The defense ministry is responsible for combat forces, search/rescue, and intelligence operations. The core of the Lithuanian force structure is the "Iron Wolf" Rapid Reaction Brigade consisting of three mechanized and motorized battalions and appropriate combat support elements. An additional three battalions are located in the western military district. The National Volunteer Defense Forces (home guard) consist of one battalion-sized unit in each of Lithuania's 10 districts. The 600-man navy uses patrol boats and former Russian corvettes for coastal surveillance; the 800-man air force operates 10 helicopters and 17 planes used mostly for reconnaissance and border patrol. A mandatory 1-year conscription and alternative service is available for conscientious objectors.

The 5,400 border guards fall under the Interior Ministry's supervision and are responsible for border protection, passport and customs duties, and share responsibility with the navy for smuggling/drug trafficking interdiction. A special security department handles VIP protection and communications security.

Lithuania became a member of the United Nations on September 18, 1991, and is a signatory to a number of its organizations and other international agreements. It also is a member of the Organization for Security and Cooperation in Europe, the North Atlantic Coordinating Council, and the Council of Europe. Lithuania gained membership in the World Trade Organization on May 31, 2001, and aspires to NATO membership in the next round of NATO enlargement. Lithuania is among the group of countries aspiring to gain membership in the European Union in 2004. It also seeks membership in the OECD and other Western organizations.

Lithuania maintains foreign diplomatic missions in 94 countries on six continents and consular posts in two countries that are not represented by an embassy. Lithuania's liberal "zero-option" citizenship law has substantially erased tensions with its neighbors. Lithuania's suspension of two strongly ethnic Polish district councils on charges of blocking reform or disloyalty during the August 1991 coup had cooled relations with Poland, but bilateral cooperation markedly increased with the holding of elections in those districts and the signing of a bilateral Friendship Treaty in 1994. Relations with Poland are now among the closest enjoyed by Lithuania. Although a similar bilateral friendship agreement was signed with Belarus in 1995, Lithuania has joined the United States and other European nations in urging the Government of Belarus to adopt democratic and economic reforms.

The United States established diplomatic relations with Lithuania on July 28, 1922. The Soviet invasion forced the closure of the Legation to Lithuania on September 5, 1940, but Lithuanian representation in the United States continued uninterrupted. The United States never recognized the forcible incorporation of Lithuania into the U.S.S.R. and views the present Government of Lithuania as a legal continuation of the interwar republic.

Lithuania has enjoyed most-favored-nation (MFN) treatment with the United States since December 1991. Since 1992, the United States has committed more than $100 million to Lithuania's economic and political transformation and to address humanitarian needs. In 1994, the United States and Lithuania signed an agreement of bilateral trade and intellectual property protection--and in 1997 a bilateral investment treaty.

In 1998, the United States signed a "Charter of Partnership" with Lithuania and the other Baltic countries. The partnership established bilateral working groups that focus on improving regional security, defense, and economic issues.

Principal U.S. Officials
Ambassador--John Tefft
Deputy Chief of Mission--William Davnie
Political/Economic Officer--Marilyn Ereshefsky
Public Affairs Officer--Michael Boyle
Defense Attach�--LTC Larry Beisel (USA)
Administrative Officer--John Gieseke
Consular Officer--Ruta Elvikis

The U.S. Embassy in Lithuania is located at Akmenu 6, 2600 Vilnius [tel/fax: (370) 670-6083/4].

[This is a mobile copy of Lithuania (10/02)]

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