DOMESTIC POLITICS: The legislature will continue to be beset by deep ideological divisions and the demands of a vocal populist element. Although the ruling four-party coalition commands the formal support of 83 deputies in the 141-member Seimas, it remains an unstable partnership. Disagreements have already emerged over tax, education and social policy reforms, and tensions will increase as popular discontent grows and the recession deepens. Our baseline forecast remains that the prime minister, Andrius Kubilius, will remain in office for the rest of the forecast period. The dominant position in the Seimas of Mr Kubilius's TS-LKD, which leads the ruling four-party coalition, makes it well placed to dictate the policy agenda over the forecast period. However, the coalition is looking increasingly fragile. Internal and external pressures mean that the coalition is almost certain not to last for the full parliamentary term, which ends in October 2012. Rising public discontent over economic hardship and political manoeuvring by the TS-LKD's coalition partners could lead to fractures.

Source: Lithuania: Country outlook

Source: Country Forecast Lithuania June 2009

Source: EIU Country Data