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Prime Minister Andrius Kubilius, together with Prime Minister of Sweden, the current EU Presidency, Fredrik Reinfeldt, has opened the first plenary session of the 11th Baltic Development Forum Summit in Stockholm today.

Address by Mr.Andrius Kubilius, Prime Minister of Lithuania at the Summit of the Baltic Development Forum:

Dear Fredrik,
Dear Chairman of the Baltic Development Forum,
Ladies and gentlemen,

Thank you very much for the opportunity to open the eleventh Summit of the Baltic Development Forum, a traditional and prominent meeting of friends from our region. This is a particular honor and pleasure to me as the current chairman of the Baltic Sea political cooperation and also as a former member of the Advisory Board of the Baltic Development Forum. Given that this Summit is held in Stockholm during the Swedish European Union Presidency, I would like to congratulate my colleague Prime Minister Reinfeldt for the excellent job done so far in promoting the interests of the Baltic Sea region in the EU.   And I would like to congratulate all of us with brilliant results of Irish referendum.

At the end of this month we expect the European Council to adopt the EU Strategy for the Baltic Sea region. We consider it as a new powerful instrument for transforming our region into one of the most advanced areas in the EU, which once implemented will give a significant boost to our ability to compete globally. At the same time, the Strategy demands that we as governments, as nations around the Baltic Sea should boost our efforts to make the region environmentally clean, attractive, accessible, prosperous, and a safe and secure place to live

The current economic and financial crisis has hit the states of the Baltic Sea region as hard as any other country in the world. There some international reports, which are saying that recession in three Baltic States is globally the deepest one. Most of our governments were forced to search for urgent solutions and encourage domestic structural reforms. There are no universal rules how to fight such crises, still there are no clear answers what were the reasons for all three Baltic states to be hit by such a deep recession, no answers - what should be changed in the behavior of commercial banks and policies of the government to avoid mistakes of such scale in the future, and also there are no common instructions on how to move from damage control to creating a winning situation for our societies under such circumstances. There are no easy answers to those challenges, but we are successfully moving from survival strategy to a long term strategy of recovery, and structural reforms.

Yes, in the Baltics we have suffered a very deep recession, but now situation is almost stabilized. Lithuania’s economy, for example, fell by 15-18 per cent and we are stabilizing at the level of 2005-2006, and what is interesting – we are stabilizing at the same level  like the economies of Germany, Finland or Sweden, despite the fact that in Germany, Sweden  or Finland GDP went down by five or seven per cent. What is a conclusion? The size of the economic bubble of 2006 -2008 years determined the degree of the fall.

In Lithuania we have three priorities for the mean time: 1) to keep financial stability, 2) to stimulate economy and keep business alive, and 3) to keep social stability.  To achieve this goal we use different tools, including National Agreement which was initiated by Lithuania’s Government and will be signed with its social partners in the nearest future. This document is expected to guide us until the end of 2010, when the main difficulties will be over. The agreement will establish agreed steps that the Government must take to fight the crisis.

Dear Friends,
This crisis is a historical one. We are facing a challenging time, a time which brings us not only difficulties, but new opportunities as well. Difficulties will not last for ever, they are for solving. This is why right now we must shift our priorities from crises management to the creation of the the foundations for the nearest and the mid term future. Right now we must determine how our region will look in 5 or 10 years? Where and how we will be at that time?

Lithuania is part of the Nordic-Baltic region, Lithuania is part of the Nordic-Baltic economy. We have three regional benefits – 1)Scandinavian economies on one side, 2)more and more interlinked economies of three Baltic States; 3)and huge markets to the East, including the countries of Eastern Partnership.  That is why we are starting to position ourselves in medium term future as  “Lithuania - Baltic Sea Service Hub”.  Our main task now is to strengthen traditional competitive advantages and create infrastructure, which is needed for development into that direction and will help us to  be attractive for foreign investments. Services,  including medical services, innovative industry and clustered traditional industry – those are the fields we are going to become competitive in the region. To confirm that we are not just talking, I want to note, that today Lithuania has signed Investment Agreement with Barckley Bank on moving their IT service center into Vilnius. And this is just the beginning.

Ladies and gentlemen,
Traditionally we have good ties among the states in the Baltic Sea Region. Once the new EU Strategy is adopted, we will have additional tools at our disposal.

The Baltic Sea region has a unique potential for sustainable economic and social development, and the new Strategy offers good opportunities for our Governments to sharpen their focus on the acute issues that the region is facing. Environment and climate change, energy, transport, promotion of innovations, developing efficient networks between universities, research centers are, in my view, the most important issues to be addressed. Lithuania, as well as other Baltic States, is still lacking efficient energy and transport interconnections, and this is a serious obstacle for the successful completion of our integration within the region and in the EU as a whole. We welcome growing attention and efforts by the European Commission directed at these issues and we can already see progress in this field.

Besides the “technical issues” mentioned above, I would like to emphasize the importance of people-to-people contacts, because the new Strategy is designed, first of all, for our people, for the people of the Baltic Sea region. This is why we must enthusiastically support cooperation projects between regions, cities, youth, non-governmental organizations and others.
 
Baltic Sea cooperation cannot be seen as complete without cooperation with our neighbours – Russia and Belarus. Strengthening of cross-border cooperation is among top priorities during the Lithuanian Presidency of the CBSS and it will remain high on our foreign policy agenda in the future. The experience and values of Baltic Sea regional cooperation should be extended towards the people of the neighbouring countries, for the benefit of all of us. I would like to encourage Russia and Belarus to take even more active part in creating a strong and lasting network of the Baltic Sea cooperation. I think the Baltic Development Forum is already playing an important role in that.

Ladies and gentlemen,

I am convinced that here at this forum you will engage in meaningful discussions and come up with new ideas, to be implemented in the best spirit of Baltic Sea cooperation. I look forward to welcome all of you at the 12th Baltic Development Summit in Vilnius in June 2010, where we will be able to evaluate the progress of the implementation of the Strategy. We plan that the issues of Eastern Partnership neighborhoods, including Belarus, transport and energy issues will be important topics in the agenda of the Vilnius Summit.

Thank you for your attention.