Baltic Reports No 4 / July 22 – 28 2019

  • August 17, 2019


Latvia is willing to solve the maritime border conflict with Lithuania. This was a hopeful statement made by the newly appointed Latvian president Egils Levits after meeting with the new Lithuanian president Gitanas Nauseda. The sea border between these two Baltic states has remained unratified for 20 years. The two countries have not been able to divide the territory because of oil fields in the water. Now there is a renewed hope that the issue will be resolved. Before meeting with Nauseda, the newly elected Latvian president also met with the Estonian President Kersti Kaljulaid on July 10. They, on the other hand, discussed creating a joint recycling system between the two countries. 

One of the top Swedish banks Swedbank is blaming all of its Baltic offices for the money laundering scandal the bank got into recently. The recently published internal investigation and audits show that Swedbank’s Baltic branches didn’t pay enough attention to the anti-money laundering actions, already in 2009. Both Estonia’s heads of the bank have been fired by Swedbank. It has also been reported that Swedbank’s clients in Lithuania are linked to a transaction used to fund Syria’s chemical weapon program. Latvia’s Swedbank branch has also been accused of illegal transactions and money laundering.


Lithuanian language Kremlin propaganda channel Sputnik News was closed down this week. The Russian state-run news website copied almost 1500 articles from Lithuania’s public broadcasters website without consent. Vilnius District Administration Court found Sputnik guilty of copyright infringement and decided that the website will have to be closed within five days. The Lithuanian language news site has been criticized for its hostile content since it was opened at the end of 2016. The closure of the website may be temporary though because the access to the website could be restored after the illegal material is still works outside Lithuania or when using VPN services.

Lithuanian Migration Department has to make a difficult decision. It is considering whether to grant asylum to a Russian citizen businessman Roman Ruzhechko. The businessman has requested asylum after he was arrested in Vilnius on July 19 on an Interpol warrant. He’s the owner of a small Russian oil collecting company „Samaratransneft terminal“. Since April, Ruzhechko has been a suspect in a Russian investigation into the contamination of around 5 million tonnes of oil. The contamination of the “Druzhba” pipeline led to a major disruption of supplies from Russia, which is the world’s second-largest oil exporter. International buyers are now seeking compensation worth tens of millions of dollars. Russian prosecutors have charged Ruzhechko and several other people in a criminal conspiracy to pollute the pipeline network. Ruzhechko’s lawyer says that Russia’s prosecutors didn’t show any proof of his client’s fault. Russian energy experts express disbelief that Ruzhechko’s small company could have contaminated such a big amount of oil. No details have been so far published of any technical information. Russia has 40 days to request extradition, but Lithuania has a chance to grant the asylum to a Russian businessman sooner than that.

Vilnius City Council renamed a street in the center of Vilnius previously named after anti-semitism idealogue Kazys Škirpa on July 24th. The street will now be called a Tri-color alley. Škirpa is a controversial character in Lithuania’s history. In 1919, he placed the first Lithuanian tricolor flag atop a tower in central Vilnius with a group of volunteer soldiers. Later he became a politician and diplomat promoting political anti-Semitism. The messages were transmitted through various channels in Lithuania by the Activist Front under his leadership. All historical research institutions in Lithuania agree that the street had to be renamed. The Jewish community in Vilnius and around the world are praising the change. However, changing the name has united nationalist politicians and activists speaking out against it. They will seek to rebuff the decision in court. Previously, Lithuania has been reluctant to admit the Lithuanian nation’s role in the Holocaust.

SOURCES: BNN,; Baltic Times.


The migration issue is bringing Estonia closer to Hungary and Poland. Polish Internal Minister together with Hungary’s and Estonia’s Foreign Ministers agreed to exchange information about migration in order to reject new initiatives – mainly those coming from the UN or Brussels. The ministers want to move against pro-migration proposals already in their early phases. This is a direct reaction to the UN global migration pact that was approved in December last year. Hungary and Poland rejected the document. Hungary’s foreign minister Péter Szijjártó called this pact the world’s most dangerous migration document. Estonia’s Foreign Minister Urmas Reinsalu has spoken out against refugees many times. Actually, Estonia has a very small number of asylum seekers. Only 481 people have been granted asylum in the past 11 years. Around half of them have left Estonia. When it comes to an illegal border crossing, around half of them are people from other Eastern European countries like Ukraine, Russia, and Moldova.

Estonia’s public debt is by far the smallest in the EU, based on the latest data by Eurostat. The report compares the ratio of government debt to GDP in the first quarter of this year. Estonia’s government debt to GDP ratio was only 8.1 percent, while the average in the EU member states was 80,7 percent. One of the reasons for Estonia to so strikingly standing out in this statistic is that after the financial crisis between 2008 and 2012 Estonian government started collecting funds rather than making big investments. Estonia was hit particularly hard by the financial crisis, but quickly recovered and is now in better shape than before the crisis. Estonians feel proud of their small debt, even though many big projects that could have improved peoples’ lives like renovating schools or building roads have been postponed a year after year because of this policy.

“I hate them for their behavior, and I apologize for the image this might give.” This is what Estonia’s President Kersti Kaljulaid said to the American magazine Foreign Policy. She was asked how concerned she is about the Conservative People’s Party of Estonia or EKRE, in short. This has kickstarted a wide debate in Estonia about how much can a president intervene in politics and how objective should she remain. EKRE members criticized the president’s choice of words calling it emotional and inciting anger. The head of state expressed her own thoughts, Kaljulaid’s office explained in a statement later.

SOURCES: Delfi, Eesti Päevaleht, Postimees, ERR News


Latvian language online portal Baltnews has been blocked by the Institute of Mathematics and Computer Science of the University of Latvia this week. They are in charge of the domain registry in Latvia and blocked the website after receiving a notice from the Ministry of Foreign Affairs. According to the public media, the ministry sent the institute a letter stating that the owner of Latvian Baltnews was a Russian news agency Rossiya Sevodnya. The news agency is directed by Dmitry Kiselyov who is on the EU sanctions list. The ministry referred to the EU documents regarding sanctions that were imposed after Russia’s annexation of Crimea and Moscow’s activity in Donbas. It is publicly known that the Baltnews online portals operating in the Baltic states are run by the Russian state through a corporate scheme. Russia has responded by denouncing the blocking of Latvia’s Baltnews. Russia’s ministry of foreign affairs criticized Riga for cleaning up its media space from unwanted media. Estonia, on the other hand, has not taken similar steps. This year, Tallinn’s Mayor and the member of the Central Party Mihhail Kõlvart and the Minister of Interior and the head of Conservative People’s Party Mart Helme have given exclusive interviews to the Estonian version of Baltnews.

Rapid population decline is becoming one of Latvia’s major economic problems, and if it won’t be solved quickly it will prevent Latvia from reaching a level of well-being similar to that of Western Europe. According to Latvian public media, earlier this summer the International Monetary Fund paid a visit to the country to measure Latvia’s economy. IMF forecasts the fastest decrease within the next decade when Latvia could lose up to a fifth of its labor force. This would hit Latvia’s economy badly. The IMF suggests bringing in foreign workers as one way to address the failing demographics. The base scenario says that Latvia could lose one-third of its population, by 2050, whereas Lithuania’s population could shrink by 17% and Estonia’s by 13%.


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