Mon, Oct 15, 2012 - Page 6 News List

Lithuanians go to the polls, with PM expected to lose


Austerity-weary voters in Lithuania looked set yesterday to evict the Baltic state’s four-year-old Conservative government in a general election and hand power to the left.

Opinion polls showed Lithuanian Prime Minister Andrius Kubilius’ Conservative party and its Liberal allies facing punishment by the electorate despite a recovery from one of the world’s deepest recessions.

Voters in the EU nation are expected to swing behind the center-left Social Democrats led by Algirdas Butkevicius, and the left-wing populist Labor party of controversial Russian-born ex-minister and businessman Viktor Uspaskich.

Butkevicius, a former finance minister, is tipped to become prime minister in a coalition with Labor.

The left pledges to raise the minimum wage and introduce a progressive income tax, but Butkevicius has also underlined his prudent credentials.

He quit as finance minister in 2005 in part because the then Social Democrat-led government did not close the gap between spending and revenue.

Defeat by the Social Democrats would be a bitter blow for Kubilius, who beat them in the last election in 2008 and is the only Lithuanian prime minister to survive a full term.

In 2008, voters heeded his message that the Social Democrats failed to rein in breakneck growth fueled by credit and wage hikes and left Lithuania ill-prepared for the global crisis.

Kubilius was also prime minister from 1999 to 2000, when Lithuania was lashed by the economic meltdown in neighboring Russia. However, the 2009 crisis was far deeper, with Lithuania’s economy shrinking by 14.8 percent.

The Kubilius government launched spending cuts well beyond those of Western members of the EU, which Lithuania joined in 2004.

“This prime minister now is linked to the cuts in wages and pensions, which many people felt personally,” analyst Ramunas Vilpisauskas said, adding that Kubilius had been frank and never sought popularity.

Despite facing defeat, Kubilius is unbowed.

“If you want to come back to recovery, first of all you need to implement fiscal austerity measures, you need to bring back order into your financial system,” he said “And we have the results.”

The recovery began in 2010, with output expanding by 1.4 percent, before increasing to 6 percent last year, but analysts say too few voters feel the benefits. The government’s growth forecast is a slower 2.5 percent this year and 3 percent next year.

Gloom has stoked emigration to western Europe, which still seems an option despite its economic woes. Last month’s data showed Lithuania’s population was 2.98 million, its lowest in decades. In 2001, it was almost 3.5 million.

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