The world financial crisis has hit the Baltics hard – Latvia the hardest, Lithuania less hard and Estonia less hard again. But considering that the three emerged from Soviet occupation not fully 20 years ago from a close to absolute zero mark in terms of any economic and civic measure that can be applied, they have not done so badly. In all three countries, decades of Soviet rule did not actually provide examples or lessons of good governance, so some mistakes were made – as they also were in countries like Greece, Portugal and Italy, with less justification. By a year from now Estonia expects to have strongly recovered from the crisis, and hopefully the other two won’t be too far behind. However, the matter needs to be kept in perspective. In 1980 Lithuanians, Latvians and Estonians would have deeply longed for the problems they have faced in 2009 and 2010, and would have considered those an absolute paradise in comparison with the normalities of their everyday life of 1980.

However, the matter needs to be kept in perspective. In 1980 Lithuanians, Latvians and Estonians would have deeply longed for the problems they have faced in 2009 and 2010, and would have considered those an absolute paradise in comparison with the normalities of their everyday life of 1980. BULL****

M6, how would you comment this: http://www.entrepreneur.com/tradejournals/article/176131428.html Author makes a conclusion: “The Baltic experiment seems likely to remain a neoliberal “miracle” only until they burn out—which will occur at the point where there is no more property to privatize, sell off, or pledge for foreign-currency loans.” And secondly http://www.un.org/Pubs/chronicle/2008/webarticles/080103_marshallplan.html “In recent decades, structural adjustment and coerced trade liberalization have created effects similar to those of the Morgenthau Plan in many countries.”

All the Baltic republics (Latvia, Lithuania and Estonia) left USSR with 0 (zero!) foreign debt since Russia has taken the liability of all of the foreign debt of USSR. USSR left Lithuania with a nuclear power plant. EU recently closed it. USSR left Latvia with hundreds of hospitals, schools... and now these USSR built schools, hospitals are being closed on requirements from IMF which preconditions new loans to the country with harsh austerity measures. Today, 20 years after Latvia has enjoyed "freedom" and "democracy" in the western style, Latvia is forced by IMF to close almost 70% (that is seventy percent!) of its hospitals built by USSR. Watch AlJazeeraEnglish video "Latvia closes hospitals and schools under spending cuts" on YouTube. After getting independence from USSR these Baltic countries have uncritically and blindly followed whatever the western imperialists told them to do, as blindly as they hated Russia. Baltic republics thought that since westerners hate Russia as much as they do that the westerns would then bring them some good. They applied neoliberal policies. American economist Dr. Michael Hudson claims that all the Baltic republics are INTENTIONALLY being destroyed by the neoliberal advisers from USA and western Europe in order to force the country into colonial submission. One can see an interview of Dr. Hudson to a Latvian journalist in YouTube (search YouTube with "Prof. Michael Hudson Interview"). Dr. Hudson is the author of the book "Super Imperialism: The Economic Strategy of American Empire" and author of the article "World Economic Crisis: Latvia’s Neoliberal Madness - You Think Greece Has Problems? Latvia's Road to Serfdom". All these Baltic republics wanted "independence" and now after USSR gave them independence they have become slaves to the very same neocolonial masters who exploited Africa, Asia and Latin America for centuries. Let them enjoy!

Yes, if poor pathetic Lithuania had only remained loyal to the barks of Moscow they wouldn't be in the position they are today. Just look around Russia, all over the country the entire infrastructure has been upgraded to modern standards. In fact, the main road linking the two biggest cities in the country has two whole lanes! It's obvious Russia doesn't have the same problems Lithuania has. There are no such protests like those in Lithuania. The police make sure that doesn't happen. Thanks RT for being faithful to remind us how miserable everyone else is in the whole world outside of Russia.

20 years of Independence, 20 years of liberty and democracy. It feels so good ;)

Oh, Balkan Bear, can you explain how on earth Lithuania, Latvia and Estonia being so miserable without the glorious motherland are managing to maintain higher GDP per capita, higher HDI position, lower corruption levels, higher atractivenes for business, lower crime and generally much hgiher standard of living than that in Russia?

Response to Vse.berlin, Part 2. Vse

Vse.berlin asked me to comment on a long article on Baltic economies from

M6, do you really want only bitching? Can you talk business? How would you call me if I would use the lexicon the ultra right Russians use about Estonians and what they think about Estonians? Besides I did not find that Russians/Soviets instigated such damage like you placate (http://www.tallinn.ee/g3280s23834) My question was about de- industrialization. You said that Estonia has healthy share of production. But quick check showed that after bubble burst Estonia turns out to be cheap labor outsourcing country. I

vse.berlin, I do not understand what you are talking about. You got a bunch of measures and statistics and yet you are saying that Baltic countries are dancing on the cow's bones? What is Russia dancing then? Knowing that Russia's situation and the standard of living of Russian people is considerably worse than that of the Baltic states even AFTER the crisis? Even AFTER the crisis Russia's GDP per head is lower than that of Latvia (the poorest and the least successful of the 3 Baltic countries) which suffered a -18 per cent decline in GDP? How come? And how come that all 3 Baltic countries are maintaining substantially better positions in pretty much ANY global ranking to do with quality of life, economy, business, safety, freedom, democracy and pretty much anything else? How come Lithuania has got the fastest and best quality internet infrastructure in the world (along with Japan)? How come that those miserable Baltic kittens without any natural resources, bursting real estate bubbles, emigrating populations, fallen economies, huge unemployment and lots of other problems are doing MUCH BETTER than the resource-rich, powerful and glorious Russia? I just don't get it.

Jay Famous GDP. GDP = private consumption + gross investment + government spending + (exports − imports) In case of Baltics Private consumption = Financial bubble + housing bubble Gross investment = Financial bubble + housing bubble + EU donations Government spending = Financial bubble + housing bubble + EU donations Import is pretty big. Export is on margins. I repeat, no gloating. I’m really interested how it will develop. In case of Baltics considering population the only way for sustainable (independent) growth and prosperity is export. M6 is right. Estonia fairs better and Govt tries all means possible to attract foreign enterprises. But as I can see it this is a cheap labor export. If wages will grow considerably the production will flee again. May you will do better. I do not know. I cannot see the competitive edge to make your countries export oriented. At the same time if you will not find your place in the market you will be continuously breastfeed by EU. Is it your dream? Basically the same happened in East Germany. After re unification entire industry was killed. Massive investment into infrastructure, yes, but right now East Germany with notable exception of Potsdam, Leipzig and Dresden and some tourist villages is being rapidly depopulated.

Vse.berlin, unfortunately it is not possible for the Baltics, nor for others of Russia’s small neighbours whose very existence seems to annoy Russia, to have the same normal relations with Russia as they do with all other countries on the planet, nor to trade with Russia normally as they trade with all others. This is because Russia will not have it that way. Russia constantly makes demands, seeks privileges and influence for itself that betray ongoing imperial twitches, and uses trade as an instrument of foreign policy to try to exert its will and control over the Baltics to where normal relations become impossible. Every concession is followed only by a new demand. My pointing this out, and detailing similar unresolved Russian actions of the past, is not a case of “bitching” (whatever your definition of that may be). It is simply stating facts. Those facts are often disagreeable, I admit. But that is not my fault. There is a reason why Russia is in various degrees of conflict with many of its neighbours, and this has nothing to do with my supposed proclivity for “bitching”. It has everything to do with Russia’s words and actions towards those neighbours, and the neighbour’s reactions to it.

I have seen this video and I was shocked..!why "RT" allways bashing baltic States...they don't wan't to admit it that they occupated 3 baltic countrys and now they have long road to go...to reach west thanks for russia. :( and now this channel spreads lies..about Lithuania..I was relly pissed when i SAW IT. and I will write a letter to RT for propoganda...but they haven't showed that Thousands of people in Lithuania ,was celebrating independence...like never before...ps.greece is facing the biggest economical crise and they said lithuania...:(((((((((((((((((((((((((((((

tpo vse.berlin I am talking about the GDP after the burst of the housing buggle, NOT before it. The reality is that even deflated by 14-18% the GDP per capita is still HIGHER in ANY of the Baltic states than in Russia. That should say you something i.e. even if we take the bubble away (which burst and has gone in 2008-2009) we are STILL doing better than Russia not to mention all other factors that I have mentioned (HDI, corruption, GINI etc, threy are ALL much, MUCH better than those of Russia or even some EU-15 nations, hence the competitive edge). And exports are marginal? Nonsense. Exports make up about 50% of Lithuania's GDP and even more so in Estonia. Slightly less than that in Latvia. Essentially Baltic GDP is MADE OF exports and the good news is that it is growing fast as we speak. Lithuania's export is estimated to grow 14% this year and so far it seems to be the case. Consumption will be weak this year and even next but even despite that GDP growth is estimated to be 1-2% this year and 3-5% next year with FDI inflows expected to double (which is largely happening... Barclay's, CSC. IBM are just a few among the new-coming investors this year alone to Vilnius. How come Barclay's has established one of 4 its global data centers in Vilnius with toher 3 being in UK, Singapore and India. They clearly had good reasons for that.). If they see the competitive edge then I'm confident so will others. And you have doubts about the competitiveness? How about Lithuania being Number 1-2 in the world in terms of internet speed and quality and by far the leading country in Europe in terms of physical infrastructure of fiber-optic data networks which ensure us communication speeds and quality (including the end-user Internet services) 10 to 20 times higer than in most other countries in the EU? It is time to climb up the value chain and go hi-tech which is precisely what is happening today in Lithuania and perhaps other two Baltic states.

Jay, So you want to become sort of Swiss in banking sector and Germany in export. Formidable task, but anyway good luck. I’m curious how you will manage it. Besides do you know the structure of your export? What comes immediately in mind is food, wood processing, some minerals, what else? And comparison with Russia is not, let’s say accurate. When Brussels unleashed the bureaucracy and made massive cash injections into Baltics infrastructure Russia was plundered. We can speak about beginning of the reforms only now. Before Putin tried to consolidate what was left after bacchanalia of 90th. And back to topic. Do not you bewildered with media attitude to Gorbachev role in Lithuania independence? He ordered troops when you declared independence and yet he NYT at this very date placates him as a hero. A bit strange, isn’t it? M6, Ok, Ok, we already learned that Russians are barbarians and have to be herded in the ghettos to be civilized under all seeing Estonian eyes. Anything more constructive?

I am from Lithuania and I can assure you that we saw MUCH deeper recession during the Soviets. That is why it is much easier for Lithuanian nation to stand this crisis - because people REMEMBER what was it like during Soviets and they KNOW that it can't get worse than that. This kind of manipulation and propaganda doesn't encourage us to love Russia...

vse.berlin No, not banking. Lithuanian industry and exports structure is rather diversified (unlike Russia's which is solely dependent on oil and has). The stress, of course, goes on high added value products. It is estimated, for instance, that solar-panels will make up about 0,5bn EUR by 2016 which is a significant contribution. Biotech, nano, laser industries are developing too. So all in all the hi-tech sector should make up a substantial share of the export structure. Food and related products (including live animals, food, etc.) made up 19.6% of total exports in 2009. Mineral products (primarily oil products) made up 21.5% while chemicals 9.1%, machinery 10%. Of course the "image" may be different. How many British consumers know that Tesco's (largest British supermarket chain and 3rd largest in the world) own Technika brand is largely manufactured in Lithuania in Tauras TV factory? Or that large share of plastics and fertilizers used in the EU today are made in Lithuania? So it is far from being just food. However, I guess those who make their living in those industries know this very well. And regarding Russia, let's be fair. It has been an economic disaster ever since early 90's (it was an economic disaster in the shape of USSR prior to that). Sitting on a pile of money (oil) Russia didn't manage to build even a single motorway in all those years (apart from MKAD upgrade). Look at China, this is how things are done these days. Baltic countries may not yet be like Switzerland or Netherlands but they at least are trying and going to the right direction and despite the bumpy road most figures clearly prove that as so do investors who come there.

To LT citizen.

I'm not sure how old you are, but there was no depression in the Soviet time at all. At least in Balt states. Prices were stable for years(still remember: meat 1,2 rub, 15 cop. icecream, 4 cop. bus fair) , and unemployment did not exist. If you think about 1991 - sorry, this collapce happened to all republics after the break up of the Soviet Union. Russia was hit hard, too. 

I was born in Vilnius, LTSR and remember how well all Baltic countires were supported. From agricultural, they turned to industrial: factories, hospitals and school were built. We had free education, medical, housing. Production: Shilalis, Tauras (TV), Snaige (refrigr.) not mentioning great dairy products and meat. BUT I still remember Russians visiting Vilnius and bying CANNED food wich we never did in Lithuania because we always had FRESH food.

Now, how the country could be free if TV station, factories and roads do not belong to Lithuania? Sold out to the West. Civilization? Well, maybe the raods are great but people are poor. At least Russia, sitting on oil has indenendancy, but Balts will never: lack od natural resources. Sad fact: Balts will always be vassals. It doesn't matter whoes, but that's why they don't like Russia. Can't prosper, West doesn't help, so better blame Russians rather than themselves.

As  kids, we were taught that capitalistic society will not waist a penny in those useless republics. Unprofitable. China is cheaper. Moreover,  Balts are well educated  (thanks to the Soviet educ.system).  Now, only smart people could recognise brainwash from the truth. The most honest  Lithuanians do understand the reality They don't buy nationalism that the government spreads and speculates because can't provide better life for own people.