Painful history is not hard to find in Lithuania. The country was subjected to Soviet and Nazi occupation. Following WWII, the Red Army moved back in and incorporated the Baltic State into the USSR.

With the breakup of the Soviet Union in 1991, Lithuania regained its independence. Since then, the country has steadily pursued integration into Western institutions like NATO and the European Union.

Though Lithuania has come a long way in its negotiations with the European Union, some key issues remain to be resolved. Among the biggest stumbling blocks are agriculture and justice, with crime and corruption among Brussels’ chief

concerns.

In Soviet times, bribing the authorities was often the only way to get things done. Some Lithuanians, and their ex-Soviet political leaders, still seem to hold on to those practices today. Overcoming that legacy is one of the toughest challenges Lithuania faces.

The Kaliningrad solution

Sandwiched between Lithuania, Poland and the Baltic Sea lies Kaliningrad, a Russian enclave that was once part of German east Prussia. Once Lithuania and Poland become European Union members in 2004, Kaliningrad will become

completely surrounded by the EU (see photo).

Access to Kalningrad from Russia and vice versa brought the EU and Russia on a collision course that had the potential to derail the entire eastern enlargement project. An agreement was finally reached in November.

Beginning next July, multiple entry documents will guarantee access for the enclave's 1.5 million-strong Russian population to the Russian mainland.

EU invests heavily

Over the last four years EU foreign investment has increased. At the Beginning of 2001, it amounted to 64 percent of total foreign direct investment. But the country still lags behind its Baltic neighbors. Foreign trade is lower than it is in Estonia or Latvia.

The EU, Lithuania’s main trading partner, accounts for almost half of the country's exports. But imports have grown much stronger than exports and the country's trade balance is negative.

Pro-expansion government

The parliamentary elections in October put a pro-NATO, pro-EU, center-left coalition into power, replacing a conservative government that believed in almost exactly the same things. A political consensus seems to be emerging. At the top of the new government’s agenda is to export more to the West and get more foreign investment.

People in Lithuania are less Eurosceptic than in other candidate countries, mainly because the alternative is so bleak. The country has made impressive progress in the past decade compared with other ex-Soviet countries.

With Lithuania’s full membership of the European Union, an in many ways painful history could come to a happy end.