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President of Lithuania - next EU budget 'very, very hot' issue

President of Lithuania - next EU budget 'very, very hot' issue
By Euronews
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Lithuania’s President Dalia Grybauskaite will chair the European Union from July 1st.

As an EU Commissioner in Brussels, before becoming her country’s first female female leader, she knows the European Union well.

Grybauskaite spoke to euronews in the country’s capital, Vilnius.

euronews: “The EU Presidency will put the spotlight on your country, and I guess that you want to make the best of it, but six months is quite short, and we often see some hot potatoes being passed on from one Presidency to the next. So considering this, what are your ambitions, what are you willing, and able, to achieve?”

Dalia Grybauskaite: “Of course, usually, we are willing [want to do] a lot more than we can achieve, because it depends not only on the Presidency but also on all institutions, including the member states, the Parliament, and the Commission, partly. But about hot potatoes, probably the largest one – and maybe very, very, very hot – can be still the European budget for seven years [2014-2020]. During these difficulties, we need resources, financial resources, as soon as possible, starting from 2014. If we will be delayed, that means financial resources will be delayed.”

euronews: “So what would that mean for ordinary Europeans, then, if you achieve this result?”

Grybauskaite: “If we will achieve – as much as we can, I mean it’s more than 70 programmes we need to negotiate – that means that from 2014, new programmes can start, new resources can come, especially if we are talking about youth unemployment, for young people, so they need money, they need employment and this will now depend on the Presidency and on the Parliament and on member states.”

euronews: “Can a country of three million people, which is outside the euro, influence the course of a European Union which is totally focused on the eurozone turmoil? Don’t you fear being sidelined?”

Grybauskaite: “No, I don’t, because all [the] main decisions, no matter [whether] they are decided or pre-decided in the eurozone, need to be confirmed by the [then all] 28 [member states] from July 1st. ( By that date Croatia will be in the EU) So that means, finally, we are reconfirming or confirming altogether the main decisions.”

euronews: “But the integration move is about the eurozone at the moment. There is talk about an economic ‘government’ for the eurozone, more regular eurozone summits, institutional changes… And the gap between non-euro members and euro members is deepening.”

Grybauskaite: “I would argue a little bit against that, because of course the eurozone can have its own governance and so on, but the problem of economic difficulties, including debt, the state debt crisis, is not only in the eurozone. Some countries are having problems [whilst] not having the euro. So that means that it’s more general, it’s not a euro crisis, its a state debt crisis, it’s a financial crisis, an economic one, and it’s not necessarily concentrated on the eurozone.”

euronews: “So you don’t fear that non-euro members will become minor players…”

Grybauskaite: “No, it still did not happen up until now, so I hope that it will not be the case.”

euronews: “Are you still planning to join the euro in 2015? Lithuanians are not so enthusiastic about it, and you can’t blame them for that, because belonging to the euro is not so popular at the moment.”

Grybauskaite: “Of course, there are fears in public that you can [could] pay probably for the countries who are not very disciplined and not taking care about [looking after] themselves well, but for us, a small country, a very open and liberal economy, already having de facto euro, because our currency is already pegged to the euro, we do [our currency does] not fluctuate… So really we have [it] de-facto, but we do not have monetary policy in our hands, we are not able to devalue when we need, for example as was done in other countries. So in reality, we have all the obligations of the euro and not all of the rights.”


euronews: “So you would join the euro even if you have the support of only one third of the population?”

Grybauskaite: “We will try to explain to people.”

euronews: “Would you put the question to a referendum? Poland is considering that …”

Grybauskaite: “No, I think that consultation with the people is not necessarily done via a referendum. But in 2004 Lithuania had a referendum for EU membership, and in our membership treaty it is written that as soon as Lithuania ir ready, she will join the eurozone. So, that means, we treat it as if we already had support by a referendum. But of course, explanation, additional explanations, especially in this difficult situation, are needed and we need to talk with our people.”


euronews: “Your country, along with the other two Baltic states, applied very tough austerity programmes early in the crisis, and growth has returned. Why did this work for Lithuania and not in Greece or Spain?”

Grybauskaite: “First, you rightly point out that we had a very tough [economic policy], because a little bit is not enough. All these measures, especially on the cuts, need to be only temporarily. So Lithuania this time did it only for two years, with the promise to people that we would compensate pensions and some other cuts and we are doing this. After we started to recover in one year and a half after a 15 percent drop in GDP (in 2009), immediately we started to recover and because of that people trusted us, because we promised and we delivered, that it is would be temporary and that we will would compensate.”

euronews: “Didn’t this policy work also because you are a small open economy, based on exports, where the average wage is little more than 600 euros ?”

Grybauskaite: “I think that it works not only because of that. It works because we were able to explain to people, we were able to have consensus, and also we started with politicians, me included, the largest one. My salary was cut by about 30 percent.”


euronews: “I would like to switch to energy now. Lithuania relies 100 percent on Russian gas, and Gazprom makes you pay much more than your neighbours for this. Can you actually break free from this dependence?”

Grybauskaite: “Yes. Today we are in the middle of building our LNG terminal (liquefied natural gas), and by the end of 2014 we will finish it and from the beginning of 2015, we about half of our needs will be covered by the LNG terminal. On electricity also, by the beginning of 2015, we will have a link to Sweden by then and we are building a second link with Estonia and Finland. So we will be fully integrated into the ‘Nordpool’ (Scandinavian electricity network) system by the end of 2014, beginning 2015.”

euronews: “So, we are talking about years here, not decades…”

Grybauskaite: “No, no, no, it’s only two years we need to survive, because you are absolutely right, we pay about 30 percent more for gas than, for example, Germany does.”


euronews: “But the high price you pay has a lot to do with your firm political stance towards Russia…”

Grybauskaite: “Not only political stance, it’s a firm stance on energy reform also, because we are introducing the third package of energy reform of the European Union (legislation separating energy suppliers from transmission networks), we are trying to cut our dependency from Russia and of course, they are not happy.”

euronews: “Is this firmness towards Russia still necessary 23 years after independence?”

Dalia Grybauskaite:- “I think that the price which we are paying shows that Russia is still using energy resources as a political, economical pressure.”


euronews: “One last and maybe more personal question. It is quite unusual for a Head of State to be a black belt in karate.”

Grybauskaite: “It was in young time.”[I was younger…]

euronews: “Can a parallel be drawn between politics and this martial art that you are very familiar with?”

Grybauskaite: “I think that martial art[s] are not only about physical fitness and being young, but mainly the philosophy of life, the discipline, and commitment to what you do and how you achieve the goal. And this is [all] applicable to any work you do, including politics.”

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