Fri, Feb 13, 2009 page9

• Slump shatters East European dreams

  After five years of boom, Lithuania is experiencing a slump worse than in western Europe. Faith in liberal capitalism, however, has survived

  • By Jason Burke / THE GUARDIAN
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  If you are a French-speaking trucker happy to be based 80km from the Belarus border with a minimum monthly wage of US$290, then Irena Grabaliskiene would be pleased to hear from you.

  Grabaliskiene is director of the job center of Marijampole, a city of 50,000 in a bleak corner of farmland and forest in southern Lithuania, and the truck driver’s post is the only one of eight available at noon last Thursday that she cannot fill. So for the vast majority of the 3,000 registered job seekers in Marijampole, the outlook is bleak indeed.

  “I try to be optimistic. Doing what I do, you need to be,” Grabaliskiene said with a wan smile.

  

  ILLUSTRATION: MOUNTAIN PEOPLE

  Optimism is thin on the ground in Marijampole — as it is across eastern and central Europe. From the Baltic to the Black Sea, the global economic downturn is striking hard. The latest predictions are that Lithuania’s economy will shrink by 6 percent this year, that of neighboring Latvia by 10 percent. Next year will not be much better.

  For such states, which broke free from Soviet rule in 1991 and survived a rocky period of economic transformation in the years after, the shock of the crisis is far greater than in Western Europe. The last half decade has seen an extraordinary boom. Year after year, growth rates have hit double figures. That boom has now come to a shuddering halt. Latvia, which only months ago was top of the EU growth charts, now has the fastest shrinking economy in the EU. Lithuania is not far behind.

  “We were growing, growing, growing and then ... bam!” Lithuanian Prime Minister Andrius Kubilius said. “For us this has not been an easy period. People are upset, emotional, nervous. The problem is how to survive the next two years.”

  For Kubilius, leader of Lithuania’s main conservative party, the crisis means change.

  “A crisis brings opportunity for really significant change,” he said. “If you don’t change, you just suffer.”

  The question now is what form that change will take. Already the economic crisis has fueled tension across the region — there were unprecedented riots in Lithuania and Latvia last month. Many in Western Europe are predicting outbreaks of populist nationalism, demagoguery and civic unrest.

  Local politicians and analysts say that Western fears of a wave of street violence or even collapsing states are exaggerated, but agree that the economic crisis is provoking new soul-searching about which economic and social model to pursue when the dust settles.

  “It will make a big difference to us, the first post-­communist generation,” said Agne Nacivkaite, 27, a language lecturer at Vilnius university, who has recently had her wages cut and works longer hours to make ends meet.

  Some of her friends have lost their jobs, after taking out huge mortgages to pay for flats whose value has gone up six times in as many years.

  “People are turning away from materialism and back to human values,” she said.

  The crisis reached Marijampole, 145km of rolling hills, iced lakes, fields and woods southwest of the capital, Vilnius, late last year. By last month new applicants for jobs had reached 3,435, twice October’s figure. And the city is far from the worst affected in Lithuania.

  Grabaliskiene said no companies were hiring and many of the hundreds of thousands of ­Lithuanians who had been working overseas were heading home.

  One is Odetta Sizvinskaite, 25, who recently returned to Marijampole from the Czech Republic, having left her job in a car parts factory. But her home town has nothing to offer.

  “I’m not very optimistic,” she said.

  At the local dairy factory, director Raimondas Karpavicius sees the crisis as an opportunity to “get closer to God.”

  “Our bodies got fat, we got lazy on EU subsidies, our souls got crushed. This crisis will do us good,” said Karpavicius, 51, who has recently laid off one-fifth of his 520-strong workforce.

  He is not alone: Observers report rising church attendance in Lithuania in recent months.

  Few in Marijampole regret the ending of the days of communist rule, however. Vitas, 42, a driver, laughed at the idea of nostalgia for the Soviet era, a sentiment increasingly widespread in eastern Europe.

  “You’ve got to be joking,” he said. “Perhaps a few of the very poor, but no one else.”

  Mistrust of today’s Russia and memories of decades of brutal, incompetent rule mean that Lithuania, the first of the Soviet republics to declare independence, remains profoundly pro-American, whatever the origins of the economic crisis. Faith in the EU, which the three Baltic states — Lithuania, Estonia and Latvia — joined in 2004, remains solid too.

  “The reaction against consumerism and the materialism of the last few years can be exaggerated,” said Virginijus Savukynas, a prominent journalist. “Very few people are fundamentally questioning the package of capitalism and liberal democracy.”

  In Marijampole, Sizvinskaite said she still felt that “capitalism like in America” was the best means for her to realize her dream of a car, a flat and a job.

  This disappoints Algirdas Paleckis, of the Frontas party, a new group which favors “state capitalism,” a “strong state ... which defends Lithuanian national interests rather than just following the EU or the US,” and reluctantly omits socialism from its name because it has “heavy negative connotations.”

  Though Kubilius insists that, after a millennium of often troubled history, Lithuania can survive two difficult years, it is clear that, as throughout the region, faith in political leadership has been badly damaged.

  “It’s pretty difficult to think of anyone worth voting for,” Arturas, 43, a construction worker laid off last month, said as he stood with 100 others outside parliament to protest last week. “Everyone just makes promises and doesn’t deliver. And it’s going to get much worse.”
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