Opposition Wins Election in Lithuania

16 October 2012, 17:41

Based on returns in three-fourths of voting districts, the Labour Party won 21%, followed by the Social Democrats with 19%. Prime Minister Andrius Kubilius's Homeland Union finished with 13%.

Slightly more than 62% voted against the construction of a new nuclear power plant in Lithuania in the national referendum.

The previous parliamentary election was held in autumn 2008 in Lithuania as the global financial crisis peaked. The situation in the country was aggravated by a steep pre-election salary, pension and social benefits hike that was not backed by equal economic growth. It was an attempt by the then Social Democratic government to stay in power while Gediminas Kirkilas who was prime minister called the crisis “something the conservatives  invented”.

Still, the latter won the election in 2008 and their leader Andrius Kubilius became prime minister. He has headed the Lithuanian government ever since despite some shifts within the coalition which originally consisted of the Homeland Union-Christian Democrats, the Liberal Union of Lithuania, the Liberal and Centre Union and the National Resurrection Party.

Struggling to restrain growth of the national deficit, his cabinet was forced to implement painful and unpopular austerity measures, including salary, pension and social benefit cuts while increasing VAT and excise duties. As a result, the financial and economic situation in the country stabilized and the economy grew by 5.8%, industrial output rose 7.4%, exports soared by 28.8%, and the total income of Lithuanian enterprises doubled over 2011. Meanwhile, the government implemented a consistent policy to strengthen Lithuania’s energy independence from Russia. This included building an LNG terminal in Klaipeda, suing Gazprom for abuse of its monopoly status on the Lithuanian market, and the initiative to build a nuclear power plant in the country.

However, with the European financial crisis in the background, Lithuanian voters felt fairly frustrated with their position. During the campaign, the winning Labour Party led by the notorious millionaire of Russian origin Viktor Uspaskich ran under the slogan “We know how” meaning that his party knew how to virtually eradicate unemployment in Lithuania, raise average pensions to 60% of the average salary, and ban MPs to work in parliament and as minister at the same time. The Social Democrats’ platform was based on the promise to introduce progressive taxes and a luxury tax while also cutting VAT on heating, a number of food items, and medicines. The Order and Justice Party which ranked fourth in pre-election polls and which is headed by Rolandas Paksas, Lithuania’s ex-president who was impeached in 2004 and accused of promoting the interests of Russian business and links to Russian special services, is likely to ally with them in the new parliament.

The platform of Homeland Union-Christian Democrats, which ran on tougher financial discipline, improving the environment for investors, reinforcing the country’s defence capacity and energy independence as its key positions, fared poorly against the competition of its opponents' populist platforms. 

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