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Resolution of Lithuania's dispute with Veolia would send a positive message to French investors, France's ambassador to Vilnius, Philippe Jeantaud, said on Monday.
Veolia
Veolia
© AFP / Scanpix

"Certainly, I think that if we manage to resolve this dispute between Lithuania and Veolia, this would be a positive sign for business associations," he told BNS.

Vilniaus Energija (Vilnius Energy), a local subsidiary of Veolia, operated the Lithuanian capital's district heating grid for 15 years under an agreement that expired in late March 2017. However, the investment ended up with mutual accusations.

Central government, municipal and law-enforcement officials accuse Veolia's representatives of illegal manipulation of energy prices and have submitted a claim worth around 200 million euros to the French group. After the claim was rejected, the capital's politicians decided to turn to the Stockholm arbitration court.

Veolia says that its investment was undermined by unfair treatment by politicians and regulatory authorities and is seeking 120 million euros in damages in the International Centre for Settlement of Investment Disputes (ICSID) in Washington.

The French ambassador told BNS that he could not say if it was the conflict with Veolia that was holding back French direct investment in Lithuania, but he noted that the settlement of the dispute would benefit the overall business climate in the country.

"Business climate is in itself important and resolution of disagreements is always a good thing," Jeantaud said.

French officials have raised the issue of Lithuania-Veolia relations in bilateral meetings of various levels.

The French government, formally, is not a party to the dispute, but Veolia is France's largest direct investor in Lithuania and, therefore, Paris is ready to offer its help to resolve the conflict, the ambassador said.

"This is an issue I cannot ignore, because Veolia is the biggest direct investor from France in Lithuania. The French government and I are ready to be accessible, open, positive and constructive if there is a wish to find a solution, to facilitate dialogue," he said.

"If we can help, we will try to do so. I have been sending this message since my arriving in Lithuania," said the diplomat, who has been France's ambassador to Lithuania since 2015.

France is the euro zone's second largest economy after Germany, but its economic ties with Lithuania are weak. With direct foreign investment of 378 million euros, France is not among the top ten investors in Lithuania. The Baltic country has invested a mere 120,000 euros in France.

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