00:08Tore Misvalis, Minister for Finance for Lithuania, thank you very much for joining us on Euronews.
00:13Thank you for inviting.
00:14We heard the invitation from Ursula von der Leyen, President of the European Commission,
00:18to Canada for an Associate Membership.
00:20What does that mean to you, taking into context what we're experiencing now
00:25with the withdrawal from the United States, from the Transatlantic Partnership,
00:28the U.S. not being the ally it once was, essentially?
00:32I believe, you know, we should be quite patient with such kind of, let's say, summaries,
00:39because, you know, for us, you know, for Lithuanians, United States is a core ally.
00:44We still, we live in this Transatlantic cooperation,
00:47and we don't want to have some kind of misunderstanding in our communication.
00:53And I believe if Canada is willing to have more intensive cooperation with the European Union,
00:58we're also accepting that as well.
01:00So we believe it could be a part of the dual Transatlantic cooperation form.
01:06So we don't look at this like with some kind of...
01:12Either or.
01:13Either or.
01:14We're just perhaps, we're going to consider this as an additional cooperation opportunity
01:19for the European Union with North America.
01:22However, we still believe in the European cooperation with the United States the way we had before.
01:28And as I said, any kind of efforts to stabilize the current geopolitical situation,
01:35even without the more predictable measures that we were used to have before,
01:41I think they might pay back in the future.
01:44So what do you make then of the decisions by the United States over the past few years?
01:49The withdrawal from really important provisions within the NATO force model,
01:54bombers, F-16s, F-35s, and so on.
01:57Also, the changes to the force posture.
02:02We've heard that potentially it could be as much as 25,000 to 40,000 U.S. troops
02:06being removed from NATO territory.
02:08Are you concerned?
02:10Of course, we're concerned.
02:11We're very concerned about some, you know, signals that we might have less troops in the
02:16European Union, in the European continent, in our region as well.
02:20It's always frustrating at the beginning.
02:22However, we have no right to believe that it's already determined that there will be a collapse
02:27of NATO.
02:28We have no signs for that.
02:30Of course, there are negotiations on different aspects, on different angles, but we still believe
02:34that NATO is strong.
02:36Do you think then this Security Council that Ursula von der Leyen is proposing, which would
02:40be the European states of NATO with Ukraine, that that is important in terms of responding
02:47to what we're seeing, particularly in countries like Lithuania, the Russian shadow war aggression
02:51that we're seeing?
02:53Yeah.
02:54I mean, I believe any kind of effort to make Europe more united is also, it's already a
03:01positive step because it's pathetic, you know, when all this banal thing that, you know,
03:06half a billion nation needs to be begging, you know, needs to beg, you know, the 330 million
03:14nation to be protected from 140 million nations.
03:17So it's really pathetic.
03:18You mean Europe looking to be protected by the U.S. from Russia involving 14 million?
03:22Exactly.
03:23This is what kind of situation we have.
03:26So it's really, really pathetic.
03:27So I think, you know, the sort of the good thing that happened after this full-scale invasion
03:33to Ukraine that Europe has spoken up, you know, we don't, we're not naive anymore.
03:38We're not showing that, you know, somebody must protect, you know, us from the others.
03:44We need to do it ourselves.
03:46And Ukraine, courage has shown a lot that smaller nation, even like three and a half
03:52times smaller nation is capable to do this.
03:55Okay.
03:55Now you are, you've been well on your way to 5% of GDP expenditure anyway, since before
04:01the Hague and the demands by Donald Trump, almost 5 or 4%.
04:05Can you tell us a little bit about what that money is being spent on, particularly, you
04:10know, in relation to drones, because that's the kind of constant.
04:12The air defense is the core priority at the moment, at the moment for us.
04:17We realize that the contemporary world has completely changed, you know, the rules, the
04:21priorities for, for the defense, especially what we see nowadays is not about tanks going
04:26from one side to another.
04:27So it's only about having some efficient defense system for the, for the airstrikes mainly.
04:33And, and obviously our prioritize, our priorities go to, to the air defense side, of course, drones,
04:39promoting drones, anti-drone systems.
04:41So this is the core priority for us.
04:44And also we believe that there are some new technologies emerging that might help, you
04:49know, to deal with this, but because now it's not about how much money you spend.
04:52Now it's about how effective in this, if effective in this expenditure you are and how smart you're,
04:59you're dealing with, with potential threats.
05:00Because the reason I'm asking you as finance minister, because you have to spend the money
05:04to invest in all of this and you have to see return for the money.
05:06I mean, how way, how much is this advancing your economy in a way, in terms of development
05:13investment?
05:14One of the initiatives that we had with the agreement with Polish, with our president,
05:18the Polish president, that we're launching a free economic zone on the border with Poland.
05:23And this allows us to have a lot of confidence that our defense industry will have a chance
05:29to, to grow a lot, much more than we had before.
05:32And we already spoke with the, with the potential global market leaders about it.
05:37So we, we, we, in surprise, we got a very positive feedback from them.
05:41They were all, most of them, whether it was United States company, whether it was Canadian,
05:46Israeli, or, or Norwegian, or French company, they were always, or Turkish company, they were
05:51all willing to be a part of this free economic zone.
05:54So for us, it's a good sign that for, it's not going to be just expenditure.
05:59This determination regarding this amount of money allows us to, to, to have a chance
06:04to be a regional leader in the defense industry and to attract investments to our country,
06:09to, to create jobs and, and to be, be, be more resilient.
06:13Instead of considering this as some kind of loss or, or just an expenditure, we converted
06:19this approach into a new opportunities for our, for our economy.
06:22And we believe that this resilient approach is going to be very, very profitable in, in,
06:29in full scale.
06:30There are concerns from, I suppose, civil society groups that the constant focus on security and
06:36defense, while important, and maybe funds too much weapons manufacturers and keeps that
06:42going to a little bit lucratively.
06:46What's your own sort of feeling about that, that balance that is required?
06:49Well, you know, when you have a pure threat next to your door, you think differently.
06:55You realize that perhaps the biggest, uh, motivation and courage for the aggressor was
07:01that we, as, as a regional, we didn't make enough efforts in order to stop them or demotivate
07:08them, you know, to keep, keep on moving.
07:09I keep saying that, you know, 18 years ago, we had a very, very, uh, uh, almost identical
07:16situation when Georgia lost 15% of the territories.
07:19And just, uh, right after, you know, we, as Europe, we didn't make enough efforts to support
07:26them.
07:27What we have now today, Georgia is completely back in Russian arms.
07:30Yeah.
07:30What we have now with the Ukraine is 10 times larger.
07:34We don't want this scenario to, to, to repeat in the Ukrainian side because it's 10 times
07:39bigger and it's even closer to, to our, you know, our heart of Europe.
07:43And one thing that's really on the agenda at this ECOFIN meeting is the windfall tax for
07:48energy companies that have had extraordinary profits made as a consequence of the chaos that
07:54we're seeing in the Middle East.
07:56But in addition to that, European taxpayers are suffering.
08:00Some people can't fill their cars.
08:01They can't pay their heating.
08:02We're coming into winter.
08:03Do you support a European tax on windfall profits?
08:09Well, you know, as a minister of finance, now I have my own lessons learned, you know,
08:13to be quite cautious regarding, you know, new taxation.
08:16And, and, uh, of course it depends on, on, on, on the brighter vision, you know, how these
08:22additional taxes, you know, could be spent in case if we're very determined and very confident
08:28about our, our, our, our expenditure plan and our action plan, why we're doing this, this
08:34one way, but, but I believe that any kind of taxation should evaluate potential, uh, growth
08:41scenario, potential ability to be competitive globally.
08:45Because, uh, if we increase taxes to our market players, you know, some of the, uh, regions like
08:51BRICS countries, like, like, like other areas, like, um, Mercosur countries that we started
08:57cooperation with, uh, as European Union, they might, you know, use a chance, you know, to
09:02take, uh, additional, uh, market share.
09:04So, global market share.
09:05So, we should be asked, uh, careful as possible.
09:08But then what do you say to the disparity there?
09:09I mean, there's a clear disparity that these, these companies are, they're making so much
09:13money out of misery and other taxpayers are, you know, so there has to be a responsibility
09:19for, for Europeans and governments like yourselves to, to intervene in some way to make some
09:24fairness adjustment.
09:26I agree.
09:26And what would that look then?
09:28Well, we'll see.
09:29We just started our negotiations.
09:30So, we'll see, you know, what's going to be the feedback after, like, all, all countries
09:34this year, their points of views.
09:36And, um, I think now it's a bit too early to, to see, like, what's going to be the, the,
09:41the, the decision about it.
09:42Okay.
09:43And just finally, um, we, we've got this negotiation for the next round of sanctions against Russia.
09:48The French and the Slovakians, but many of the French are insisting that the name of
09:53Umarov, Umarov, is removed from the sanctions list.
09:57Um, the presidency, uh, the Irish presidency of the European Council.
10:00It's saying that, you know, we can't allow this because we thought we saw the end to removing
10:05names of sanction lists when, uh, Victor Orban, uh, was unelected.
10:09Um, what's the Lithuanian position on that?
10:12For the sake of getting the next patent sanctions package across the line, would you be willing
10:17to give in to the French?
10:18They say it's an issue of national security.
10:22Well, regarding any release of sanctions, we're very skeptical because the war is not over.
10:27We believe that, uh, any kind of, uh, uh, efforts to minimize sanctions for Russia before we have
10:37a peace deal.
10:38I believe that the Russian side could consider it as, as our weakness.
10:42So we are always very skeptical at this stage regarding any kind of, uh, uh, decrease of sanctions
10:50regarding Russia.
10:51So for us, it's a red, a red line and, and we don't support any kind of lighter approach
10:57before we, we, we, we're having break-even regarding the, the, the peace deal.
11:01So, but what if the sanctions are with, are held up?
11:05Because remember this sanctions package relates to 3000, uh, individuals and companies.
11:10So it's a big one if, if it's, uh, not allowed to pass.
11:13I know, I know, but, uh, I, we are very skeptical regarding, you know, uh, this kind of scenario
11:20because we believe it's too early.
11:22We, we, we believe that Russia should, should understand that, uh, we are united.
11:27We see Ukraine as a part of our, our enlargement process and any kind of efforts to occupy more
11:36or just, uh, make, um, make more damage to Ukraine, even like in the future, it's completely
11:43unacceptable.
11:43And we just fully support even like, uh, providing more sanctions to Russia.
11:49Yeah.
11:50Tarim Asfalis, uh, Minister for Finance for Lithuania.
11:52Thank you very much for joining us on Euronews.
11:54Thank you very much.
11:55Thank you.
11:57Thank you.
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