Growing Lithuanian business ties beget political support

Since 2010, both bi-national trade and tourism has doubled, and two new regularly scheduled flights have just been set between the two countries.

Lithuanian FM and Bibi370 (photo credit: Amos Ben Gershom GPO)
Lithuanian FM and Bibi370
(photo credit: Amos Ben Gershom GPO)
Israel’s burgeoning ties with Lithuania have yielded a close political relationship, Lithuanian Economy Minister Evaldas Gustas told The Jerusalem Post Tuesday in an interview at the Dan Hotel in Tel Aviv.
Since 2010, both binational trade and tourism has doubled, and two new regularly scheduled flights have just been set between the two countries.
There have been 30 official diplomatic visits in the same period, compared to only 20 in the 15 years prior.
The reason for the change? “Israel understood that all these medium-size and small countries have the same number of votes in the UN,” Lithuanian Ambassador Darius Degutis said.
From the political end, that has turned out to be a good investment. Lithuania, an EU member (and euro-zone hopeful) has pushed for postponing regulations that would define Israeli territory within the Green Line.
“We are supporting Israel in the sphere that it could take part more actively in economic relations in the EU,” Gustas said. “I have to say that we are talking with other member states to postpone other decisions in the sphere.”
Although Lithuania is supportive of peace talks and efforts by US Secretary of State John Kerry to improve the Palestinian economy, it takes a backseat on such issues.
No less important, Lithuania is taking steps to restore relics of its powerful Jewish history, decimated in the Holocaust.
Vilnius, where Jews at one point represented 45 percent of the population, was “The Jerusalem of Lithuania.”
But more than atoning for its Holocaust sins and attracting Jewish tourism, Lithuania is interested in cooperating with the start-up nation to boost its hi-tech economy.
Israel has already taken an active role in both helping develop and participating in Lithuania’s annual BioMed conference, and the governments have cooperated to expose their start-ups to one another.
Israeli start-up Wix recently announced it would open an office there. In October, 17 Lithuanian startups attended Israel’s DLD tech conference in Tel Aviv. Eight are in negotiations for Israeli investors. One of them, TrackDuck, which creates a visual feedback system for websites, joined Israeli accelerator The Elevator as a result.
“They have this soft approach where they organize events, bring in mentors for different events,” TrackDuck CEO Edmundas Balcikonis told the Post. “So the way Elevator came to Lithuania was because government-sponsored Enterprise Lithuania, responsible for increasing innovativeness, invited them.”
“Lithuania is becoming similar to Israel,” he said. “People are very active from an entrepreneurial side. Maybe not as good as selling, but there’s a certain cultural fit that I think works very well, and I think that’s why Wix chose Lithuania.”
Israel may also have something to learn from Lithuania. While Israel’s ranking on the World Bank’s “ease of doing business index” has gradually slumped to No. 35, Lithuania has climbed its way to No. 17.
The way it did that, Gustas said, was by putting its business registration process fully online and making it two-three times faster to start a new business.
Unlike Israel, they have managed to incorporate high-tech into their daily economic details.
“When I got here four years ago it was quite a shock,” Degutis said of his exposure to Israel’s paper-based banking system. In Lithuania, about 90% of the banking is done online, he said.