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Financial Challenge for Lithuania

Next year will be the real turning point for Lithuania from a financial point of view. After gaining independence, Lithuania was dependent on economic support from the European Union to help decrease its dependence on Russia. Many projects started by the country decades ago were successfully financed by the European Union. However, with belt tightening in Brussels, Lithuania’s economic outlook looks tenuous.

Besides the Ignalina nuclear power plant, Lithuania badly needs money for continuation of the Rail Baltica project that would link Lithuania, Finland, Estonia, Latvia and Poland with a European standard gauge rail line. No decisions have yet been made about the next funding period. And Vilnius is making enormous efforts to persuade the EU to continue support for the project.

In other words Lithuania can’t put a full stop to these projects but it can’t continue them without external assistance. Energy Minister Žygimantas Vaičiūnas insisted in December that “EU support is crucial and we simply do not have any other alternatives.”

At the same time, lack of funding does not prevent Lithuania from increasing its defense budget. This year Lithuania will allocate €873 million euros for defense. The increase is €149.2 million more euros than in 2017.

By redirecting this amount to such a vital project as decommissioning the Ignalina nuclear power plant, Lithuania could easily afford to close the plant in the next 20 years without external assistance. If you compare the necessity to close the plant and the necessity to buy containers, trucks, repairs of military equipment, and spare parts for vehicles, the priorities are clear. Maybe something is wrong with the priorities of the Lithuanian government?

With all this additional money Lithuania could close a dangerous nuclear plant and also build a modern railway without asking the EU or other sponsors for money. Let us think about it…