Good morning, everybody—convener and members of the committee. It is such a pleasure to be here in the Scottish Parliament and to have this opportunity to meet you. I am grateful to have this occasion to give a brief overview of the priorities of the Lithuanian European Union presidency.
On 1 July this year, Lithuania assumed the EU presidency for the first time. Lithuania has been in the European Union for nine years, and this is the first time that we have assumed the role—it is the first time that any of the Baltic countries has done so. The other two Baltic countries, Latvia and Estonia, will have the role in 2015 and 2018 respectively.
Before I start talking about Europe, I will say a few words about my country, Lithuania. We have successfully overcome the recent economic and financial crisis, and we are returning to sustainable recovery and growth. We are comfortable, economically and financially, in assuming the presidency, as we do not have any internal agenda or internal issues to be solved. We can therefore focus on the EU agenda. The GDP of Lithuania is now growing at a steady rate of about 3 per cent. We have significant growth in foreign direct investment, at a rate of 20 per cent per year. Economically, things are okay.
Lithuania being a small country, we come to the presidency as an honest broker. For us, the success of the presidency lies in a good compromise for all 28 countries. We know that compromises are difficult to reach, but we also know that all European decisions are the fruit of one or another compromise. That is the Lithuanian understanding of the presidency.
The European Union is moving towards recovery and closer co-operation between member states and the European institutions. We believe that co-operation between the European institutions—the European Parliament, the Commission and the European Council—is needed more than ever. Only when those three institutions are functioning effectively can we achieve good results.
The Lithuanian presidency motto is a credible, growing and open Europe. Why is that? The EU should demonstrate that it is pursuing credible financial and economic policies. It should be committed to growth and jobs, and it should be open to partners. I will speak a little bit about all and each of those priorities.
On sustainable finance, we are working on further banking union. The Commission has made a proposal on the single resolution mechanism and we will ensure that there is discussion of that at European level. We do not think that an agreement will be reached by the end of our presidency, but it might be that some agreement could be reached before the European Parliament elections in 2014.
On better economic governance, we speak about creating a favourable environment for the implementation of key social and economic reforms at EU level. That includes smooth and effective implementation of the newly agreed rules for the so-called ex ante budgetary monitoring process for member states in the euro area. The euro area is important, because it affects both euro zone members and non-euro zone members.
Lithuania seeks to ensure the smooth application of provisions contained in the stability and growth pact. We dedicate our attention to the process of transposition of the treaty on stability, co-ordination and governance into national systems, which is being done in each member country.
On financial interests, one aspect is the fight against tax fraud. In the field of combating tax fraud and tax evasion, special focus is being placed on expanding the automatic exchange of tax information both among EU member countries and between the EU and third countries.
An important point is the credibility of Europe for its citizens. As you all know, 2013 is the European year of citizens. That means that we need to raise awareness and knowledge of the rights and duties related to EU citizenship, so that EU citizens can fully exercise their rights to move and settle down freely within the EU, as well as benefit from the other opportunities. Currently, more than 2 million EU citizens who are not UK citizens reside in the UK. That fact is worth bearing in mind in preparing for next year’s European Parliament elections and local elections—EU citizens can also vote in local elections.
On the EU budget and growth, you will know that the principal agreement on the multi-annual financial framework was reached with the European Parliament in June this year. Although that decision has been made, before the MFF can be adopted on 1 January 2014 we need to implement and finalise a legislative package of 75 implementing acts. That is quite important and needs to be done rather quickly before the end of the year. The Lithuanian presidency will also adopt the first annual EU budget, which will be a one-year budget for 2014. That budget will be a starting point for the implementation of new EU programmes.
The important thing for tackling unemployment is the effective implementation of the compact for growth and jobs. In that context, we are focused on the implementation of the so-called European youth guarantee and the operation of the youth employment initiative. That should be ready by 2014, so we are in the preparatory stages. We are also initiating discussions and preparing Council declarations on the European alliance for apprenticeships, which is a new thing. We believe that, as that initiative aims to improve the quality and supply of apprenticeships across the EU, it will be rather important in tackling youth unemployment in particular.
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Lithuania is very much a digital country and e-government is one of our favourite things, so of course the digital agenda is a high priority. We speak about the establishment of a single EU digital market, and within that market we have such initiatives as electronic identification and trust services for electronic transactions. Those two things are important for the good functioning of our digital single market.
In implementing the EU single market for growth, what is important is the implementation of adopted measures on the functioning of the internal market, especially the services directive. There must also be progress in the discussions on the so-called Single Market Act I and Single Market Act II.
Lithuania is focused on energy security, so energy issues are also high on the agenda and I will mention two things with regard to energy. One is the internal energy market. Within the single market we do not yet have a single energy market. The target is to create an internal energy market by 2014 and to have the interconnection of electricity grids around Europe, but we are still working on that objective.
The second thing that is important is our energy policy towards third countries—whether when we purchase energy from a third country we apply the same rules for all EU member states or different rules. At the moment, the situation is that different rules are applied, and we want to homogenise more.
I have a few more brief points. There is a move towards macroregional strategies within the European Union. As you may know, the Baltic Sea region strategy was the first macroregional strategy, followed by the so-called Danube strategy. We believe that the Baltic Sea region strategy functions well. One of the important aspects is that all member states participate in the strategy, not only those bordering the Baltic Sea, and that is the strength of the strategy, which is effective. We will be hosting a huge conference to review the strategy and to discuss further implementation during the next financial perspective.
Lithuania has taken up all the foreign policy issues that are on the agenda. We have spoken about Syria. On 1 July, the first day of our presidency, we had the Egypt crisis with President Morsi—there is never a dull moment in foreign policy. We also have a long-term perspective and we pay attention to our eastern neighbours. As you know, the European Union has two focuses—southern neighbours and eastern neighbours—and although most of the conflicts are going on in the southern neighbourhood and we are always working on that, we should not forget the eastern neighbourhood. There are no conflicts in the eastern neighbourhood, but it is still in the interests of the whole European Union to have a stable, democratic, free trade area in the eastern neighbourhood. The idea is to have an eastern partnership summit in late November this year, and possibly get signatures on some important agreements with the Ukraine, Moldova and Georgia on free trade.
Turning to the EU enlargement process, we have started our presidency with one more member. As you know, Croatia has joined the European Union, so we are now 28 countries. There are also discussions on the table with the western Balkan countries; they are at different stages but the process is continuing. We do not think that concrete agreements will be signed during our presidency, but progress should be made with each of those Balkan countries.
In relation to our strategic partners, we are happy that during our presidency the negotiations on the free trade and investment agreement with the United States took place. The negotiations started on the so-called TTIP—the transatlantic trade and investment partnership—and the political will is strong to have an agreement reached by the end of next year. It is an ambitious agreement, so our negotiators will have to work hard. We also have in mind the start of free trade negotiations with Japan, which is another important trading partner for the European Union.
That is the position in a nutshell, so I shall stop there. I would very much appreciate your comments and I am happy to answer your questions. Thank you for your attention.