By Trend

Trend’s exclusive interview with Vice-Minister of Foreign Affairs of the Republic of Lithuania Egidijus Meil?nas.

Question: What are the priorities of cooperation between Lithuania and Azerbaijan in the sphere of economy?

Answer: Azerbaijan is one of our main trading partners in South Caucasus. Although, trade relationship between Lithuania and Azerbaijan currently are not intense, they could be intensified in the short and medium run. There are opportunities in some sectors to consider in order to expand the trade between Lithuania and Azerbaijan. Industrial engineering (mechanical engineering, electrical equipment), food industry, transport and logistics, furniture, electronic equipment, medicine could be the most potential sectors to expand our bilateral cooperation.

Lithuania has a well-developed food industry – this sector produces a big share of added value in the economy. We can offer Azerbaijan a huge variety of food products, for which the main export market is the EU – the market that requires the highest quality of food products. Industrial engineering companies from Lithuania perform outsourcing activities as well. The most developed subsectors in industrial engineering are the mechanical engineering, metal processing, automotive, computer, electronic and optical products, and electrical equipment industries. Lithuania is well-known worldwide for its optical and laser industry. I believe that Azerbaijani companies can also offer high quality products in these areas, so we can no doubt find better possibilities for further economic cooperation.

The 4th place given to Lithuania in the Global Fintech Index 2020 means that we have a huge potential to be a center of financial technologies. Lithuania has significant advantages in the ICT sector - good information and communication infrastructure, one of the fastest Internet in the world, multilingual qualified specialists. We are among the strongest in Europe in the field of cyber security. Last year, the Lithuanian company Nord Security won the German and Baltic Business Awards 2020 as the best company offering cyber security solutions in the Baltic States.

Furthermore, for decades Azerbaijani tourists have been welcome to both enjoy the Lithuanian nature and to benefit from high quality, innovative healthcare and rehabilitation services. The flows of tourists had been disrupted by pandemic restrictions. But once Schengen borders are reopened, we will be looking forward to further promote incoming tourism to Lithuania, which will, hopefully, exceed the pre-pandemic numbers.

Q.: Which opportunities are there for investments between the two countries?

A.: We seek for more Azerbaijani green field investments in Lithuania especially within high-value added and innovative service sectors (health and life sciences, as well as high technologies). We can offer favorable investment environment, highly qualified employees, perfect logistics and infrastructure (IT and communications), competitive operating costs and living standards. Companies operating in the fields of manufacturing, data processing or web server services can benefit from the Green Corridor. This package of laws offers significant tax incentives and dramatically cuts red tape, making it quicker and easier for international businesses to establish and grow large-scale operations in Lithuania. We invite Azerbaijan businesses to take advantage not only of favorable conditions in Lithuania, but also of the benefits provided by the Green Corridor and to make the best of it.

Q.: Could the two countries open Trade Houses to boost their trade relations?

A.: It takes mutual interest to develop trade relations and the best way to foster our economic and trade cooperation is by exchanging our business delegations and encouraging direct B2B contacts. Moreover, Azerbaijani and Lithuanian companies can take advantage of various initiatives to find potential business partners. For example, an event in Lithuania that was planned in 2020 and postponed to 2021 - the Life Sciences Baltics 2021 to be held in Vilnius on September 22–23, will focus on life sciences, pharmaceuticals, bio- and med-tech. This forum will be organized online, so we invite Azerbaijani companies, seeking for a unique opportunity to meet stakeholders and trend-setters of this industry not only from the Baltics, but from all around the world, to participate in this event. It should also be borne in mind that not only governmental institutions but also businesses themselves can take the initiative to develop bilateral economic relations. Chambers of Commerce may be established to make a significant contribution to the promotion of trade relations.

Q.: What progress have the two countries achieved in the integration of their transportation sector? What are the prospects for further growth of cooperation in this sphere?

A.: Lithuania is an important transit country in the East-West and North-South transportation corridors. One of the main tools for increasing cooperation possibilities between Azerbaijan and Lithuania is an international combined train project - the Viking Train - that links the network of the sea container lines of the Baltic and the Black seas, the Mediterranean and the Caspian seas. Therefore, our country can offer Azerbaijan a safe, fast and inexpensive transportation of Azerbaijani goods, like oil and its products, to Europe and the Scandinavian countries.

We have a well-functioning multimodal transport and logistics system, a well-developed railway network, a modern Klaip?da State Seaport and good roads. Klaipeda State Seaport is the northernmost ice–free port on the Eastern coast of the Baltic Sea. It is the most important and the biggest Lithuanian transport hub, connecting sea, land and railway routes from East to West. Klaipeda is a multipurpose, universal, deep-water port, which provides high quality service with 14 big stevedoring companies. Ship repair and ship building yards operate within the port as well as all types of marine business and cargo handling services. The annual port cargo handling capacity is up to 70 million tons. In 2020, the port handled 47.8 million tons of cargo.

Q.: How do you assess the energy cooperation with Azerbaijan? What are the ways of even more developing the bilateral ties in this sphere?

A.: While paving the way towards a more dynamic and diversified economy, Lithuania proactively and continuously focuses on reinforcing regional energy security. To this end, large-scale energy projects aimed to boost connectivity and competitiveness are in progress, such as the Gas Interconnection Poland–Lithuania (GIPL) and the Synchronisation of the Lithuanian electricity grid with the continental European network.

Lithuania also holds bold plans to promote investments in the reliable and competitive local power generation. Development of off shore wind farm projects in the Baltic Sea will increase local power generation and fulfill Lithuania’s commitment to green energy transition. Our goal is to generate 50% of Lithuania's energy consumption from renewable sources by 2030. We also aim to decarbonise our energy system completely by 2050.

We see renewable energy resources among the fields of possible bilateral cooperation with Azerbaijan in the energy sector. We are open for international cooperation and for sharing experience in the green energy generation, clean energy technologies and innovative solutions to enhance both energy security and the realisation of a low-carbon future. We have strong laser industry with the focus on solar energetics – solar cells research, developments, innovations and manufacturing. Lithuanian companies, producing high quality and innovative photovoltaic panels, are working in Europe and worldwide, take interest in establishing relations in developing solar energy projects in Azerbaijan.

Lithuania remains a strong supporter of an ambitious and result-oriented Eastern Partnership policy. In terms of energy, Lithuania stresses the importance of working together in solidarity to build a fair, inclusive and sustainable recovery, to alleviate the effects of the pandemic crisis and to accelerate the clean energy transition in the EU and in the Eastern Partnership countries [including Azerbaijan, Armenia, and Georgia].

Lithuanian institutions, as well as Lithuanian energy companies, have already been developing numerous initiatives in the eastern partners, sharing their expertise and best practice. In 2021, Lithuania together with Georgia and with the support of the European Commission is co-leading a newly established Eastern Partnership network on renewable energy. The network aims to explore and to identify the existing obstacles to the achievement of a greater share of renewable energy sources in the energy mix of the eastern partners.