TRIP TO REGIONS HIGHLIGHTS ECONOMIC DEVELOPMENT

UNCLAS VILNIUS 000814

SIPDIS

SIPDIS

DEPT FOR EUR/NB

E.O. 12958: N/A
TAGS: PGOV LH
SUBJECT: TRIP TO REGIONS HIGHLIGHTS ECONOMIC DEVELOPMENT



1. Ambassador Cloud visited Panevezys and Birzai on November 7 and
8, meeting with city political leaders, linen and glass companies,
and a group of NGO leaders. The Ambassador delivered remarks at a
high school, encouraging the students to consider study
opportunities in the U.S., toured a local museum and gave two press
interviews.


2. Political leaders detailed economic development plans using EU
structural funds, including a science and technology park and a new
electric plant. One mayor indicated some citizens' suspicion of the
EU funding process, a chronic concern in Lithuania, while another
mayor expressed concern that the technology park would remain empty
as a result of companies' interest in hiring only cheap labor.
Ambassador Cloud pointed out that construction of the Via Baltica, a
highway corridor through Poland and the Baltics, could attract
investors and tourists.


3. Business and political leaders expressed concern about
competition with China, particularly in the textile industry, key to
the region. One mayor expressed disappointment at EU failure to
follow thru on a promise to address competition with China and
suggested that the U.S. and Lithuania join efforts. Ambassador
stressed that the U.S. wants free and fair trade and maintains a
dialogue with the EU about competition. One company director
proposed a solution whereby companies would work to find their own
niche in the product market and wait out the period of China's
influence until consumers learned to appreciate quality products
over mass production.

LEADER