I spent Friday and Saturday in Kaunas, Lithuania, guest teaching strategic management to an executive class at the ISM business school. It was an interesting experience – I had never before been in a former East Bloc country. I learned as much as you can expect to when you have two days in a country and spend most of the time in a classroom. The school took good care of me, though, I did get an good view of Kaunas, including a walk along the main pedestrian thoroughfare (pictured) and an excellent dinner with honey beer and Lithuanian snack specialties in the old town center.
My impression was that of a country which is still trying to find its personality – at least in terms of what economic and cultural impression it intends to make on the world. The economy is lacking in natural resources, but has some industry. Still, a comparatively large part of the population makes its living off agriculture, most of which is produced for internal consumption. The country was relatively prosperous when part of the Soviet Union, but much of the industry folded in the face of international competition and the relative disappearance of Russia as a trading partner. The country is slowly coming out of the post-Soviet funk, but still struggles with unstable government (with many of the heads of business and politics having apparatchnik backgrounds), corruption and lack of internationally competitive industries.
Lithuania does not have a very distinctive history – the last time the country was important was in the 1400s with the Archduchy of Lithuania. The Holocaust remains a sore point, and the population is shrinking due to emigration, primarily to the United States. Like many nations which have been held in suspended animation during the Communist period, there seems to be a number of old issues that people still are willing to fight over, though anyone from the outside really can’t understand why. Democratic traditions are still immature, open for exploitation by populistic politicians such as Viktor Uspaskich, a former Russian welder who managed to become economy minister six months after forming his party. He was forced to resign this summer after using his office for personal gain. (He was also discovered to have bought fake degrees from Moscow and a university in Kaunas, which I am sure didn’t help him much.)
So there is some work to do find and implement anything resembling a national economic strategy. One possibility might be that the country takes a leaf out of Denmark’s book and recreates itself as a source of excellent agricultural products. The food certainly is good enough. The country does not have the luxury of the highly educated population and lack of industry that contributed so much to the Irish miracle, but perhaps political stabilization, increased trade with Germany and the long-term influence of their EU membership can induce the diaspora to take a more active and direct role in the country’s economy. It would be deserved – this nation needs to look forward to an democratic future rather than falling back on a largely mythical illustrious past.
They do have excellent basketball, though!