A Free Lithuania Turns To Economic Concerns

NEVER had such back-breaking work been so enjoyable for Arvidas Zabarauskis.He was one of six men dismantling the red marble base of Bolshevik revolutionary leader Vladimir Lenin's statue. The monument had dominated Vilnius' central square for years only to be toppled soon after August's coup collapsed and Lithuanian independence became a reality. "For a Lithuanian, this is very satisfying work," Mr. Zabarauski said. Many Lithuanians are working to remove reminders of the nation's forced membership in the Soviet Union. But destroying the old may prove easier than building the new. For starters, many Lithuanians say they don't feel free, although more than 30 Western nations have recognized the independence of the Baltic states of Lithuania, Latvia, and Estonia. The United States was expected to recognize the Baltics on Labor Day. The national Soviet legislature should formalize the inevitable this week, approving the departure of the three republics. Lithuanians seem to be having trouble shedding January's siege mentality, when 13 people were killed in an Army assault on the Vilnius television tower. "There is still the possibility of a provocation," says Laima Kinderis. "The Soviet Army and OMON are still here, and I won't breathe freely until they are gone." The OMON, or black berets, said over the weekend they were disbanding in Vilnius. But there was no indication the barricades around Lithuania's parliament would soon come down. Concrete blocks seal off the front of the parliament and barbed wire rings much of the building. Tough times are predicted for Lithuania as it switches to capitalism. Its industrial base is small, and food products are the main export. It is also almost entirely dependent on Russia for energy. Its economy already faces difficulties. In Vilnius' stores there is food, but little variety. Consumer goods are so scarce that a coupon system was launched in August to ease shortages of everything from rugs to radios. Most government officials hesitate to put a price on the cost of transition, but Eugenijus Maldeikis, head of the Ministry of Economics Department of Strategy and Reform, estimated it will take $2 billion to get Lithuania on the road to capitalism. "It's also necessary to change the way we think about economics," Mr. Maldeikis says. The first step will be lifting all price controls. Privatization of state property and the introduction of a Lithuanian currency will follow. These could bring significant social upheaval, says Saulius Peciulis, deputy head of the Department of Strategy and Reform. "It could be worse than in the former East Germany," he says. Many officials hope Lithuania can become a free economic zone and a conduit for East-West trade. "Lithuania hopes to become the trampoline for the Russian market for trade with Western Europe," says Mr. Maldeikis. But some of the pillars of development appear to be shaky. For one, Lithuania is cash-strapped. According to Kazimieras Antanavicius, chairman of the parliament's Economic Commission, citizens have about 10 billion rubles (about $313 million at the tourist exchange rate) at their disposal, while there is 100-billion rubles' worth of state property (about $3.13 billion) waiting to be privatized. Lithuania will also remain reliant on Russia. Before the collapse of the Soviet Union, Lithuania conducted virtually all of its trade with the other Soviet republics. After independence, Mr. Antanavicius says, Lithuania hopes to conduct about 80 percent of its trade with Russia and 20 percent with the West. Trade with Russia would be mainly on a barter basis, with Lithuania providing food in exchange for raw materials and energy resources. "Of course, if there is instability in Russia, our economy will b e severely affected," he said. Another problem is that Lithuania has virtually zero population growth, meaning there won't be enough people to fuel industrial expansion. As it is, Lithuania depends heavily on skilled ethnic Russian laborers, who settled in the republic after the 1940 Soviet annexation. In addition, Lithuania doesn't have much to offer to guarantee foreign loans. But no matter how difficult the problems, most Lithuanians say they are prepared to sacrifice. "I was prepared to give my life for independence," says trolley driver Tamosunas Kestutis. "It may be rough for the next 10 years, but then I expect to be able to live a normal life."