Economist

Not set in stone: How Lithuania dealt with its Soviet statues

Main image:  JOSEF STALIN stands in military dress, his hand tucked inside the breast of his coat. Vladimir Lenin sits—relaxed, cross-legged—with a book. Elsewhere, he extends his arm, mimicking the pose he adopted when he arrived in Russia in 1917 to seize power. Grutas Park, a sculpture garden in south-west Lithuania, is the home of 86 such relics of the Soviet era. Established by Viliumas Malinauskas, a mushroom magnate, the park has been their woodland home since 2001.In 1990, when Lithuania declared its independence from the Soviet Union, citizens pulled down statues of leaders and prominent communist figures. In the heated political moment there was little thought for what to do with them subsequently (as seems to be the case in many of the American cities that have removed their Confederate monuments). After a debate in Lithuania’s parliament, the statues were removed and placed into storage. In Grutas Park, they have been sited thoughtfully across 20 hectares of forest. The figures are grouped according to their role in Soviet activity: the Totalitarian Sphere depicts key thinkers and prominent leaders; the Red Sphere features members of the resistance; the Death sphere shows the bloody means by which the regimes were kept in place. Indeed, the park allows the spectre of suffering to ...

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The old countries: Eastern Europe’s workers are emigrating, but its pensioners are staying

Print section Print Rubric:  Eastern Europe is losing workers and keeping pensioners Print Headline:  The old countries Print Fly Title:  Emigration in eastern Europe UK Only Article:  standard article Issue:  The 45th president Fly Title:  The old countries Location:  VILNIUS AND RIGA Main image:  20170121_EUP002_0.jpg IN THE Lithuanian town of Panevezys, a shiny new factory built by Devold, a Norwegian clothing manufacturer, sits alone in the local free economic zone. The factory is unable to fill 40 of its jobs, an eighth of the total. That is not because workers in Panevezys are too picky, but because there are fewer and fewer of them. There are about half as many students in the municipality’s schools as there were a decade ago, says the mayor. Such worries are increasingly common across ...

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The appeal of the euro: SELL signals

UK Only Article:  standard article Issue:  The war within Fly Title:  The appeal of the euro Location:  VILNIUS Main image:  Another blissful day in the euro zone Rubric:  Joining the euro is still attractive to some Another blissful day in the euro zone HAS the euro crisis dissuaded other countries from adopting the single currency? Not a bit of it. Since 2009, when euro-zone GDP shrank by 5%, four countries—Slovakia, Estonia, Latvia and Lithuania (let’s call them the “SELLs”) have joined. Their experience suggests that the euro still has its benefits, but also some familiar risks. Many thought that joining the euro would spur the SELLs’ foreign trade, by removing the friction of exchanging currencies. The Slovakian central bank, for example, predicted a boost of 50%. That was wildly over-optimistic: the euro has made little difference to Slovakia’s imports and exports. The problem may have been a confusion of cause and effect. ...

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The view from Vilnius: The link between pro-austerity and anti-Brexit

IN RECENT years one of the most divisive issues in economics has been whether or not you see the Baltics as a success. When the financial crisis hit they decided to pursue what the IMF called "unprecedented fiscal and nominal-wage adjustment", in an attempt to preserve their currency pegs with the euro. A long debate has ensued as to whether the Baltics were right to do what they did, and whether countries like Greece, Portugal and Spain have anything to learn from them. Cue reams of graphs about output gaps, exchange-rate competitiveness and nominal-wage rigidity. I have been in Lithuania reporting on another story. Happily, Lithuania's economic and financial elite are now willing to talk about what they did during the crisis. The arguments they put forward are fairly convincing. The first concerns naked economics. When the crisis hit all the Baltics were "euroised", i.e. banking-system liabilities were heavily denominated in euros. The IMF has data on the proportion of private-sector loans denominated in foreign currency. The figures for Estonia, Latvia and Lithuania in 2010 were 90%, 90% and 80% respectively (i.e., high).Some economists say that the Baltics should have let their currencies devalue. Economists in Vilnius counter that had they allowed the currency to devalue, a banking-system crisis would have ensued (because the cost in litas of serving euro debt ...

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Dry-bulk cargo shipping: Hitting the bottom

UK Only Article:  standard article Issue:  The trust machine Fly Title:  Dry-bulk cargo shipping Rubric:  Worse is still to come for many bulk carriers HOW low can the Baltic Dry Index go? That is the question the owners of bulk carriers—ships that carry loose commodities such as coal and iron ore—are asking themselves. Between the start of the financial crisis and January this year, the index—a measure of bulk freight rates—had fallen by 95%. Many in the industry had hoped it would start to recover this year. But there is not much sign of that—and it looks as if more pain is still in store for shipowners. Overcapacity is the main reason for such low rates. When the index approached an eye-watering figure of 12,000 in 2008, shipyards could not keep up with the orders for new bulk carriers. But then the bubble popped, as demand for commodities collapsed due to the financial crisis, and Chinese economic growth underwent a structural shift away from heavy industry. The index fell to a 30-year low of around 500 in February. There was a modest rebound in the summer, but ...

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Eastern Europe and migrants: The mosques of Lithuania

UK Only Article:  standard article Fly Title:  Eastern Europe and migrants Rubric:  A Baltic state worried about the arrival of Muslims overlooks those who have lived there for centuries Location:  VILNIUS Main image:  20150919_blp904.jpg FOR the past few weeks, even as Germany has tried to drag Europe into welcoming Syrian migrants, the Baltic states of Lithuania, Latvia and Estonia have been debating a ban on burqas. There have been no reports of burqas being sighted in the Baltics, so the idea of prohibiting them seems rather superfluous, like banning nude sunbathing in Antarctica. In Lithuania, when the burqa ban was first proposed by the chairman of the country’s national security committee, most officials dismissed it as absurd. (“I suggest you look around the streets to see how many women cover their faces,” says the country’s justice minister, Juozas Bernatonis. “I have seen none.”) Yet the very discussion testifies to the fear triggered in central and eastern Europe by the European ...

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Lithuanian politics: Stirring the pot

UK Only Article:&nbsp; standard article Fly Title:&nbsp; Lithuanian politics Rubric:&nbsp; The leader of an ethnic Polish party tries to broaden his appeal by reaching out to ethnic Russians Location:&nbsp; VILNIUS Main image:&nbsp; 20150307_eup501_2.jpg HE CONDEMNS Ukraine's Maidan protests and has been photographed wearing the black-and-orange St George’s ribbon, a symbol of Russian imperial power. But Waldemar Tomaszewski (pictured) is not a rebel commander in the Donbas. He is the leader of the political party of Lithuania’s Polish minority, the Electoral Action of Poles in Lithuania (AWPL). Mr Tomaszewski’s support is not broad; on March 1st he came third in Vilnius’s mayoral election, with 17% of the vote. But as a leader of Lithuania’s ethnic Poles, who make up 7% of the country’s population, his international influence rises above his domestic support. Relations between Vilnius and Warsaw have long been strained over issues such as the restitution of property confiscated under the Soviet regime and the refusal to ...<div class="og_rss_groups"></div>

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Teacher recruitment: High-fliers in the classroom

UK Only Article:  standard article Issue:  Putin’s war on the West Fly Title:  Teacher recruitment Rubric:  Programmes that place bright and ambitious graduates in poor schools are spreading around the world—and show what it takes to make a difference Main image:  20150214_IRD002_0.jpg “IT’S not enough to have a dream”, reads a banner over the whiteboard in Nancy Sarmiento’s Baltimore classroom. Most of her 12-year-old pupils qualify for a free or cheap lunch. About 70% of the school’s new arrivals last September had reading and mathematical skills below the minimum expected for their grade. Americans call such schools “disadvantaged”. Whatever the label, most countries have schools where most children are from poor families, expectations are low, and teachers are hard to recruit. And in most, the falling prestige of the teaching profession makes matters worse. But Ms Sarmiento, who graduated from a four-year biology degree course a year early, had to see off fierce competition to win her teaching ...

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The world’s nurseries: Getting ‘em young

UK Only Article:  standard article Issue:  America’s new aristocracy Fly Title:  The world’s nurseries Rubric:  Early education matters, but it is not everything THE mayor of New York, Bill de Blasio, has promised that there will be free pre-schooling available to all the city’s infants this year. It is one example of a wider American political enthusiasm for dealing with gaps in educational attainment by focusing on the youngest. International comparisons show that such measures have a long way to go—and that they are far from a cure all. Figures from the OECD show America faring quite well on provision for 0-3-year-olds (see chart); but when it comes to providing pre-school for 3-to-5-year-olds it falls to the back of the class—behind Chile and just ahead of Lithuania and Greece. Attitudes to the right way to spend early childhood years still vary around the world. Scandinavians dislike formal early schooling but relish subsidised day care earlier on. German parents put relatively few of their toddlers into formal crèches, but are happy for them to head off to ...

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Lithuania's ex-deserters: Going after Tomas

UK Only Article:  standard article Fly Title:  Lithuania's ex-deserters Rubric:  Russia wants to prosecute soldiers who quit the Soviet army when their country quit the Soviet Union Location:  VILNIUS Main image:  20150117_eup501.jpg THE phone call from the Ministry of Defence came the week that Tomas*, a 45-year-old Lithuanian chauffeur, had been planning to go to Belarus to show his daughters where he performed his military service. Tomas is one of over 1500 Lithuanians who walked away from their mandatory stints in the Soviet Army in 1990 and 1991, as the USSR was collapsing. Others (like the young protestors pictured above in February 1990) simply refused to report. Now the ministry was warning Tomas not to travel to Russia or other countries outside the EU or NATO. Russia, according to Lithuania’s Prosecutor General, had asked for help in investigating another “deserter” over the summer—one of a series of such requests, officials say. The request was denied, but Lithuanian ...

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The Economist explains: Why Lithuania is about to adopt the euro

THE euro zone is in a terrible state. Growth has been anaemic for years. It is on the verge of deflation, where prices fall, thereby pushing up the value of debt. Unemployment is high: in Spain and Greece it exceeds 20%. The debt-to-GDP ratio of the euro zone has increased from 84% in 2010 to over 90% today. Yet Lithuania, a fast-growing, low-debt Baltic state of 3m people, will on January 1st become the 19th member of the club. Why?Most obviously, Lithuania is supposed to join. All 28 member states of the European Union (EU), except Denmark and Britain, which negotiated opt-outs, have to join the single currency. Lithuania has been a member of the EU since 2004, when it joined with nine other countries. Its Baltic neighbours, Latvia and Estonia, already use the euro. Some say it was only a matter of time before Lithuania followed suit. And there are other political reasons why joining the euro may be necessary. Lithuania is an ex-Soviet nation and is a short flight from Moscow. About one-in-twenty Lithuanians are Russian-speaking—the group that Vladimir Putin, the Russian president, has undertaken to “protect”. Many Lithuanians hope that the euro will be a symbolic defence against a Kremlin incursion. But there are other reasons why Lithuania wants to join. Boosters point to the economic benefits of membership. With euro adoption, investors believe that economic ...

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Lithuania and the euro: Strange bedfellows

UK Only Article:  standard article Issue:  Sheikhs v shale Fly Title:  Lithuania and the euro Rubric:  The euro zone’s newest member faces an uphill struggle Location:  VILNIUS Main image:  A ticket to Taiwan A ticket to Taiwan ON JANUARY 1st Lithuania will become the 19th member of the euro zone. The small Baltic state of 3m people is one of Europe’s fastest-growing economies. The euro zone is on the verge of recession and deflation. So why does Lithuania want to adopt the single currency? Fewer than half of Lithuanians are keen, according to a recent survey by Eurobarometer. But, like all countries that joined the European Union after the euro’s creation, Lithuania is obliged to. Since 2002 it has pegged its currency, the litas, to the single currency. It tried to join in 2007, but was rebuffed on the grounds that its economy was out of sync with the euro zone’s. It still is. Since 2011 the euro zone has stagnated; Lithuania’s ...

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The world in numbers: Industries: Energy

UK Only Article:  standard article Fly Title:  The world in numbers: Industries Main image:  20151101_nic003.png As the global economy ticks up in 2015, overall energy consumption will climb by about 3%, outpacing crude-oil demand, which will creep up by 2%, to 94m barrels a day. After years of splurging, most Western super-majors are aiming for better returns on smaller investments—though Chevron will outspend its far bigger rival, Exxon Mobil, investing $40bn. Big Oil’s success will depend partly on riding the boom in oil caught in American shale rock. Thanks to that, global supplies look very comfortable and the average annual oil price will fall, geopolitical ructions notwithstanding. A parallel shale-gas “revolution” will spawn a batch of American plants for exporting liquefied natural gas (LNG): the first, Sabine Pass in Louisiana, should start up in 2015. Import terminals in Poland and Lithuania will also begin operations as eastern Europe seeks to slip the yoke of Russian supply.  Strong Asian demand, above all, will help gas producers, as dirty coal loses share to somewhat cleaner gas. China’s attempts to tap its ...

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The world in numbers: Countries: Lithuania

UK Only Article:  standard article Fly Title:  The world in numbers: Countries GDP growth: 2.7%GDP per head: $16,680 (PPP: $28,060)Inflation:3.3%Budget balance (% GDP):-1.8Population:2.9m Algirdas Butkevicius of the Social Democratic Party leads an ideologically diverse coalition, but all parties are agreed on the broad direction: an open economy, close alignment with Western powers in foreign policy and strong support for European integration. Energy security will be a policy priority; Russia supplies 100% of the country’s gas at present. The economy will grow substantially faster than that of its European partners. To watch: Exchanging notes. Lithuania will become the 19th member of the euro zone on January 1st as the litas gives way to the euro. Published:  20141118 Source:  The World In Enabled

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UNICEF's report on child poverty: Important, shocking, but lacking

UNICEF, a branch of the United Nations, has just released an interesting report on child poverty during the Great Recession. The report’s results have been reported widely and are distressing. It shows that since 2008 2.6 million children in rich countries have sunk below the poverty line. In 23 of the 41 countries analysed, child poverty has jumped since 2008. In Ireland, Croatia, Latvia, Greece and Iceland rates rose by over 50%. Change in child poverty, 2008 to 2012 (anchored in 2008) I should say at the outset that I am generally convinced by what I’ve read in this report. It is a very important topic and one that needs to be debated more. But for people serious about analysing poverty, the report is not good enough. I’ve been puzzling over a few things in particular.Making assumptions is all well and good in economics research: it is often unavoidable. But researchers usually spend a long time justifying their assumptions, and showing what happens when they make different ones.But in this report the authors make assumptions that are not adequately justified. Take their definition of “poverty”. Usually academics define poverty as those people with incomes below 60% of their country’s median. That’s a relative measure, of course. Here, though, the authors use income figures from 2008—before the crisis really hit—as a “benchmark” against which to compare the incomes of ...

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Lithuania and the euro: No slip-ups

TODAY Mario Draghi, the president of the European Central Bank, visited Vilnius, the capital of Lithuania. Lithuania formally adopts the euro in 2015, becoming the 19th country to do so. (We will be reporting more on Lithuania’s economy in the coming weeks.)Early this morning there was a rather pompous ceremony, in which Lithuania was “formally welcomed” (a lovely bit of Euro-speak) into the euro zone. With Beethoven’s “Ode to Joy” blasting out, Mr Draghi solemnly presented Mr Vasiliauskas with an enormous golden star that contained samples of the new notes. Your correspondent was disappointed that the handover passed off without a hitch (Mr Vasiliauskas did not drop the star, or anything like that), thus depriving journalists of an easy metaphor.Most outsiders are puzzled that Lithuania wants in. It has to adopt the euro, of course, having joined in 2004. And it has held out longer than the other two Baltic states, Estonia and Latvia, which joined in 2011 and 2014 respectively.But many Lithuanians seem rather keen on the idea. Mr Vasiliauskas points to the reduced costs of international trade. The finance minister reckons that adoption signifies Lithuania's arrival on the world stage, and hopes that it will encourage Lithuanian émigrés to return home. Other, more hawkish, observers say that Russia is less likely to menace a euro-zone member. For those reasons, the ...

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On Azerbaijan, work, air traffic, interns, Ukraine, heating, grades, batteries, Google: Letters to the editor

UK Only Article:  standard article Issue:  Xi who must be obeyed Fly Title:  On Azerbaijan, work, air traffic, interns, Ukraine, heating, grades, batteries, Google The West’s disengagement SIR – I welcome the fact that The Economist has shone a spotlight on the long-protracted dispute over Nagorno-Karabakh (“A mountainous conflict”, September 6th). But calling Nagorno-Karabakh a “republic” plays into the hands of the separatists who strive to gain international legitimacy. In reality Nagorno-Karabakh was created in violation of Azerbaijan’s internationally recognised territorial integrity and hundreds of thousands of ethnic Azerbaijanis were forced from the region. Other conflicts happening right now demonstrate how vital it is to commit to the territorial integrity of states. But there is now a dangerous trend in the West where disengagement has become the norm and it is widely accepted that borders can change through the use of force. If this mindset continues it will cause irreparable damage to the international system. With regards to Nagorno-Karabakh, only international engagement and a respect for territorial integrity can ...

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Poland and Russia: Eat apples to annoy Putin

RUSSIA’S import ban on Polish fruit and vegetables will leave Poland with a big surplus of apples by the end of the year. Last year, 677,000 tonnes of Polish apples went to Russia, accounting for 56% of Poland’s apple exports.  This year Poland was able to export its apples to Russia only until August 1st when Russia imposed the import ban.Poles have responded by celebrating the forbidden fruit, encouraging people via a social-media campaign on Facebook and YouTube (pictured) to “Eat apples to annoy Putin”. Intermarché, a chain of supermarkets, is planning to send 40,000 kg of apples to Kaliningrad, the Russia enclave that shares a border with Poland, drawing humorous comparisons with Russia’s recent “humanitarian convoy” to eastern Ukraine.From Tallinn to Warsaw, Moscow’s latest trade sanctions arouse strong emotions. Russia is “a totally untrustworthy and unpredictable business partner,” said Dalia Grybauskaitė, Lithuania's president, on August 8th, the day after Russia banned food products from the European Union and other countries. In Estonia, Latvia, Lithuania and Poland, food producers and politicians expected the ban. But this doesn’t mean they were ready when it was imposed.The ban could cost Polish farmers €500m ($659m), according to estimates of Poland’s ministry of agriculture. In the three Baltic States, where food exports to Russia represent a smaller ...

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Daily chart: The good life

Audio and Video content on Economist.com requires a browser that can handle iFrames. GDP “measures everything,” quipped Bobby Kennedy, the American president’s brother, “except that which makes life worthwhile.” To better track living standards, the Human Development Index (HDI) ranks countries by life expectancy, education and income per person. The latest report on July 24th put Norway on top (as it has been since 2000). America is fifth. Drought-ridden Niger and war-torn Congo are lowest.How does this compare to day-to-day well-being? We plotted HDI against self-reported data on happiness from Gallup, an international polling company. It asks if people had been “laughing or smiling a lot, feeling well-rested, and being treated with respect” in the previous day. By this measure Paraguay has been the happiest place on Earth for the past three years. Syria, locked in civil war, is lowest.Strikingly, there is little correlation between the two measures (the correlation coefficient is 0.25, which is a very weak association). Lithuania has a happiness score of 53%. For its level of development one might expect happiness closer to 70%. Meanwhile Mali and Rwanda are much happier than their living standards might imply.More interesting still, development is generally clustered by region. But in terms of happiness, it runs the gamut from gloomy to chirpy within the same ...

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Crackdown in Kiev: Battle for Ukraine

Thugs and thieves always prefer to act in the early hours of the morning. So did Viktor Yanukovych, Ukraine’s president.Less than 24 hours after he ruined the Eastern Partnership summit in Vilnius and ditched the Association Agreement with Europe, he vividly demonstrated his preferred alternative. In the small hours of Saturday morning he sent in special troops to beat up the few hundred students and activists who stood vigil for Ukraine’s European future. Armed with truncheons and tear gas, the police pummelled the peaceful demonstration, smashing heads and kicking people on the ground. Never in its 22 years of history as an independent country has Ukraine seen such violence.It was a cowardly and treacherous action of a government that behaved like an occupant in its own capital. “Tonight Yankovych turned into Alexander Lukashenka [Belarus's hardline president],” wrote Mustafa Nayyem, a Ukrainian journalist and blogger who mobilised the civil protest a week ago. A video he posted showed the violence that Mr Yanukovych had unleashed.Protestors first started to gather in the centre of Kiev ten days ago when Ukraine froze negotiations with the EU. The government decided not to use force until after the summit. As soon as Mr Yanukovych escaped safely from Vilnius, the restraints were ...

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