G. Nausėda: the more flexible the EU is, the stronger it is

The Lithuania Tribune spoke with professor Gitanas Nausėda, well known economist and independent presidential candidate. The interview was conducted by our collaborator Liudvikas Jakavičius.

Dr. G. Nausėda – obtained a Bachelor degree in Economics by Vilnius University in 1987 and a Master Degree in Economics in 1989. From 1990 to 1992 he was studying at the University of Mannheim under a DAAD scholarship and in 1993 he obtained his PhD in Economics at Vilnius University.

He is a prestigious economist that before becoming presidential candidate was former Chief Economist for the CEO of AB SEB Bankas and lecturer at Vilnius University. In 2004, he supported the election campaign of the former Lithuanian president Valdas Adamkus and then kept out of the public eye in the political scene. Today, he is returning to politics as an independent presidential candidate for the 2019 Lithuanian presidential election.

What do you see as a major threat to Lithuania?

G. Nausėda: I think we have certain external crises which are related to the aggressive policy of our Eastern neighbour – Russia. As we all know they have some open actions in Ukraine.

How are you going to address these kinds of threats?

G. Nausėda: I think that the main possibility for Lithuania to be safe is to be more deeply integrated into NATO and the European Union. Something that fortunately we already did in 2004. I believe we need to develop stronger bilateral relations with NATO and the US to show some enemies abroad that we are strong enough, that Lithuania is prepared for possible attacks or interventions and that we spend a sufficient amount of money for those purposes. Now we have a discussion in Lithuania about the possibility to spend more. NATO members did a commitment six years ago to spend at least 2 percent of their budget in defence by 2024. We are currently discussing to increase our military budget. Lithuania’s defence budget is projected to reach 2.01 percent in 2019 and there are discussions to increase that to 2.5 percent of GDP. I think this is very important because we cannot afford to have strong military forces without sufficient financing. Yes, the East needs to probe to some sceptics that this is necessary.

There is a long discussion about whether we will spend enough for this purpose, because we will spend less for other purposes like social causes and so on. Personally, I don’t think this affirmation is correct because we have a lot of internal resources to reduce in other sectors in order to achieve this percentage of spending. At least, I see that the Lithuanian population is aware of the risks and our people understand very well what is going on and they are ready to pay this price for the safety of our country.

In your foreign policy programme, you stated that you support EU centralization. What differs an EU centralization and an EU super state?

G. Nausėda: I am not a supporter of the centralization of the EU, this is probably a misunderstanding. I think that small countries like Lithuania must have the possibility to make decisions in internal policy, especially in matters such as tax policy. We should keep some discretion in our economic policy and I am against abolishment of veto in for example tax policy issues.

Now a discussion is going on and some people think that we should unify tax policy within the EU. I think this is not a good decision because Lithuania and other Eastern EU countries should converge to Western Europe level and for us friendly and business-oriented tax policies are very important elements. With lower tax rates in foreign investors, we can have a good flow of international investment in Lithuania. If there will be a unification of tax rates it will be very difficult to find other possibilities where Lithuania will be more advanced than other markets.

In this case, I am proponent not of centralization, but of confederation of the EU. If we will go for centralization, I think we will have some consequences in the future like Brexit and I don’t want that. I think one is enough. I believe that the more flexible the EU is, the stronger it is and we should understand this. Probably, proponents of centralization are the largest countries of the EU, not the smaller ones. I can explain this by the fact that they do not take any risks with a centralization because they are big countries. For small countries, the risk is that one day we will lose our independence and we don’t want that.

What do you think about the idea of some EU politicians of creating a European Army? Is this a good idea or is better to keep only NATO and that each country keeps their own armed forces?

G. Nausėda: I have a short and a long-term perspective. In the short term I don’t see how it is possible to replace NATO as an organization. This will not happen, there are no financial resources. Today, there are just some declarations about the possibility to create common military forces in the EU. So, in the short term, I would not like that this talks about unify forces could be treated as a substitution of NATO.

In the long term, having in mind that the policy and attitude of the US to the EU will change because new generations will come and probably would not remember what does it means Cold War, we should start thinking about common military forces. For this new generations will be very difficult to understand that the presence of the US in Europe is necessary and probably the attitude towards countries like china will change. Probably voters will think that the higher priority for US will be to have them there and not in the EU. So, in the long term I see the possibility of common EU armed forces and I think that is good to start talking about this, but again this will not be possible in the short term.

What is the long term for you?

G. Nausėda: I think we can talk about 20 to 25 years. Probably in this long-term perspective we can create a unified military force in the EU.

Regarding the recent aggression of Russia in Ukraine and what happened in Syria and in the last US election where Russia tried to have some influence. How are you going to fight against these threats?

G. Nausėda: You know, we should not be naive and think that what Russia did in Ukraine cannot be repeated in other countries and Lithuania is among them. We see big interests of Russia here in Lithuania. They are interested in the internal life in Lithuania, I mean internal policy, they are interested in what is going on in our elections – presidential election particularly. I think we must be aware of this and create a clear policy of what we will do against this. So, we need a safety net, safety organizations that are responsible for cybernetic attacks and we should centralize those efforts in one institution that is responsible for all these issues.

Now we have one institution in our government, but so far this institution is not so active and do not have broad field of responsibilities and have no sufficient resources. I think we must strengthen these institutions in the future.

Do you think that it could be a good idea to create a division in the armed forces for that?

G. Nausėda: There is a division for that now, but unfortunately, I am not very well informed about the actions of this division. However, my view is that we should centralize and strengthen these efforts in one division or institution. No matter if is in our defence forces or in any other government institution.

What do you think about having mandatory conscription in Lithuania like it is in Israel?

G. Nausėda: It is something that it could be under discussion. I am a proponent of this discussion and I think in the future we will switch to this regime of mandatory military service, but maybe the girls must have the right to participate or not. But mandatory service should be mandatory for men. However, we cannot switch to this in one step.

First, we should spend more resources to create more infrastructure for this mandatory service and only after that we can move to this new regime. But I think we should strengthen this mix of professional army, volunteers and conscription. We should increase the number from 60,000 to 120,000 soldiers in case something happens. 

Do you think that it is still possible to solve Russia – EU – NATO differences in a diplomatic way? 

G. Nausėda: There is no alternative. We should solve those problems in a diplomatic way. But if we are talking about how we must do this I think the first move is on the side of the Russians. If they would like to improve the relations with Western countries, they must show the willingness to improve them. So far, they do not show any signs of wiliness and aggression of Russia is even larger than before. In our fields they are quite aggressive as well and unfortunately that does not allow Western countries to rethink foreign policy to Russia. So, the sanctions imposed in 2014 still in place and if this aggression become larger, we will probably talk about new sanctions. But even having in mind these sanctions we still have some economic relations and our relationship with them is quite active.

I think so far we don’t have any reason to say we should stop our activities in the Russian market. Of course, our food producers are very worried and unhappy about this situation, about sanctions, because Russian market is very important for them. But even having this in mind, they were able to find other markets in other countries. I think those other markets are very interesting too. Also is worth mentioning that Lithuanian economy didn’t suffer as much as some people thought it will with the sanctions. This impacted a bit in the short term but not so dramatically, we never suffer 0 percent growth during this critical period between 2014 and 2015. Lithuanian economy grew up all these years quite successfully and I am looking forward to what will happen if there is no world crisis in the future. If this is the scenario, probably we will continue growing.