1. Implementation of the National Programme for Youth Entrepreneurship Education and Promotion 2008-2012 (hereinafter referred to as “this Programme”) will contribute to the implementation of the key strategic provisions of the development of the Republic of Lithuania, especially the development of education, economy, labour market, public services to business as well as regions.

2. The period for the implementation of this Programme is 2008-2012.

3. For the purposes of this Programme, the following definitions shall apply:

Youth means persons aged 14 to 29 (except for the concept of young farmer used in this Programme).

Young farmer means a natural person aged 18 to 39 who pursues, alone or with partners, agricultural or forestry activities and has a farm registered in the Register of Farmers’ Holdings.

Youth entrepreneurship refers to the attitude, skills and knowledge of a young person that allow him/her to discover an opportunity to generate added value (both social and economic) as well as the actions aimed at taking advantage of this opportunity.

Youth business means an individual activity, as defined in the Law of the Republic of Lithuania on the Income Tax of Individuals, pursued by young people (Valstybės žinios (Official Gazette) No 73-3085, 2002) or an economic activity carried out by forming a public or a private legal person.

Target group means the Lithuanian youth and young farmers. The actions specified in the Programme are oriented at all young people, not just potential entrepreneurs or persons intending to undertake business activities.

4. Drawing on the data of research conducted in Lithuania and on factual data, the recommendations received from foreign countries (in particular EU states and the UN Economic Commission for Europe) as well as on the experience of the states having extensive experience in youth entrepreneurship promotion, three problem groups have been identified:

5. A survey of higher education graduates has revealed that they lack know-how to start a business (indicated by 53.1 per cent of the respondents) and to prepare a business plan (specified by 40.9 of the respondents). The Strategy on Ensuring Life-long Learning, approved by order No ISAK-433/A1-83 of the Minister of Education and Science and the Minister of Social Security and Labour (Valstybės žinios (Official Gazette) No 56-1957, 2004) of 26 March 2004 states that Lithuanian schools of general education devote insufficient attention to the development of entrepreneurship skills. These skills receive more attention at vocational schools.

6. The Ministry of Education and Science, in cooperation with the British Council and the Teacher Professional Development Centre, carried out the project "Dispersion of Entrepreneurship Education" and provided training to 500 economics teachers of schools of general education. However, Lithuania‘s education institutions do not train entrepreneurship education pedagogues that would have practical training knowledge and abilities, and so far our country has not had such specialists, because entrepreneurship education is a new phenomenon. Having analyzed the peculiarities of economics teaching in the country, a workgroup formed by the Ministry of Education and Science developed the Economics Teaching Programme and standards in 2001 and recommended following them starting with 2002-2003.

7. The guidelines for integrating entrepreneurship education into the curricula of schools of higher education, vocational schools or other educational institutions training students for a particular profession have not been approved yet. At these institutions as well as within the system of informal education, entrepreneurship education is pursued via projects supported by European Union funds and other funds.

8. The Long-term Development Strategy of the State, approved by Resolution No IX-1187 of the Seimas of the Republic of Lithuania of 12 November 2002 (Valstybės žinios (Official Gazette) No 113-5029, 2002), envisages preparation of business and entrepreneurship knowledge modules that should be included into the curricula of secondary, college and university education. The Ministry of Education and Science has implemented several projects related to the introduction of entrepreneurship education into vocational education (with the help of PHARE funds, a course in the basics of economics and business was integrated into all vocational education curricula) and to the publishing of entrepreneurship education materials (an entrepreneurship fundamentals textbook was prepared in the course of a project carried out in cooperation with the British Council).

9. Lithuania lacks an all-inclusive approach to the development of youth entrepreneurship, i.e. the measures of labour market, agriculture, vocational guidance and small and medium business promotion are not coordinated in a way that would allow them to strengthen each other – public authorities are working in different directions. Youth entrepreneurship must be promoted in a consistent fashion: from education and vocational guidance to consultations. Thus, the different measures applied by the State must be purposeful and well-coordinated.

10. As noted in the Strategy for Ensuring Life-long Learning, the small and medium business promotion measures are not sufficiently systematic in contributing to the improvement of the business conditions. The implemented state programmes for the development of the economy and its separate branches are not interconnected, are inadequately coordinated and oriented more towards solving the problem of employment.

11. One of the methods for practical entrepreneurship education is business practical training firms, first launched in Lithuania in 1993 in implementing a project financed by the Ministry of Education of the Kingdom of Denmark and the Ministry of Education and Science of the Republic of Lithuania. In 2006-2007, Lithuania had 48 Lithuanian practical business education firms at 32 education institutions of different types: universities, colleges, vocational schools and secondary schools. Yet another practical entrepreneurship education method is training companies for pupils, first launched in Lithuania back in 1994. In 2006-2007, there were 76 such training companies for pupils in 60 Lithuanian schools. Lithuanian training companies for pupils operate at 28 educational institutions. Economics training as well as entrepreneurship training, which probably bears the closest connection to it, is conditioned by the whole environment, in particular by the school community.

12. Youth informal education, defined in the Law on Youth Policy Framework of the Republic of Lithuania (Valstybės žinios (Official Gazette) No 119-5406, 2003), which has made a sound contribution to the development of practical and general abilities, is well-developed in Lithuania and supported on both the municipal and the national levels. The programmes implemented by the Department of Youth Affairs under the Ministry of Social Security and Labour (hereinafter referred to as "the Department of Youth Affairs“) as well as the European Union programme "Youth in Action" (Decision 1719/2006/EC of the European Parliament and of the Council of 15 November 2006, establishing the Youth in Action programme for the period 2007-2013 (OJ 2006 L327, p. 30)) promote citizenship, leader development, youth participation in NGO activities as well as youth voluntary activities. Young people acquire communication skills, self-confidence, knowledge in organisation management, planning and plan implementation, teamwork, coordination of interests and other knowledge, also social and practical skills necessary in business.

13. When performing the education function, often only formal education is recognized, although the informal education (labour market training, NGO activities) is also important. Informal education is usually more available to people who wish to improve or change their qualification, and its methods are very advantageous in terms of entrepreneurship education, as they are based on practical training and are more flexible.

14. In accordance with the Plan for the Implementation of the Vocational Guidance Strategy, approved by Order No ISAK-415/A1-71 of 23 March 2004 (Valstybės žinios (Official Gazette) No 56-1956, 2004; No 1-11, 2006), a network of vocational guidance is now being created at schools and labour market service institutions, consultants are being trained, and the vocational guidance methodology is being improved. The Ministry of Education and Science is responsible for consultations at schools of general education and vocational schools, while the Ministry of Social Security and Labour is responsible for vocational consultation of labour market participants and youth outside school. However, so far vocational guidance services have been underdeveloped and few of them have been provided – only ten labour market training services and divisions thereof.

15. Research conducted by the Ministry of Economy shows that the representatives of small and medium business are still unable to perceive the lack of entrepreneurship knowledge as one of the key obstacles to business development. Banks note that only 50 per cent of the credit opportunities for small and medium businesses are utilised, mainly because small entrepreneurs are unable to prepare business plans. By Resolution No 853 of 12 June 2002 on the Long-term Strategy for the Development of the Lithuanian Economy by 2015, the Government of the Republic of Lithuania (Valstybės žinios (Official Gazette) No 60-2424, 2002) approved the long-term strategy for the development of the Lithuanian economy by 2015. The strategy makes the following statement: although the number of economically active residents with higher or special secondary education is growing, the national entrepreneurship potential is insufficient and many businesspeople lack the appropriate education and necessary experience.

16. Part of the appropriations from the State Budget of the Republic of Lithuania to the Ministry of Agriculture goes to the education and training of young farmers. Support is extended to the training course under the Farming Basics Training Programme, approved by Order ISAK-2092 of the Minister of Education and Science of 30 October 2006. Those who complete the course acquire the minimum proficiency in agriculture as well as the right to register a farm and to develop activities. In this area, young people could be offered, in addition to traditional farming, also alternative agricultural activities, which are more attractive to youth. According to the data of the Ministry of Agriculture, young farmers lack information, complain about complicated support granting regulations and difficulties in obtaining land and production quotas, while farmer vocational training is of inadequate quality.

17. Under the measure “Setting up of Young Farmers” of the Rural Development and Fisheries priority of the Single Programming Document of Lithuania 2004-2006, approved by Resolution No 935 of the Government of the Republic of Lithuania of 2 August 2004 (Valstybės žinios No 123-4486, 2004) (hereinafter referred to as "SPD"), European Union support amounting to LTL 55.8 million was allocated for the said period. Currently, 99 per cent of this sum has been already disbursed. Support for setting up of young farmers is also envisaged under the measure "Setting up of Young Farmers" of the Lithuanian Rural Development Programme 2007-2013, approved by Decision C(2007)5076 of the European Commission of 19 October 2007. The measure was granted EUR 62.64 million in the 2007-2013 period. Order No 3D-345 of the Minister of Agriculture of 13 July 2007 (Valstybės žinios (Official Gazette) No 81-3344, 2007; No 31-1097, 2008) adopted the Implementing Rules for the measure "Setting up of Young Farmers" under the Lithuanian Rural Development Programme 2007-2013. EUR 31.12 million was allocated for the measure "Setting up of Young Farmers" in 2007.

18. Adequate support for starting up and development of youth activities is important and related to support for small and medium business, because companies established by young people are frequently micro, small or medium and eligible for appropriate support. Provision of support for youth also requires special measures, because young people lack experience and usually have no initial capital or business idea. Such special measures designed for young people have not been applied in Lithuania so far. Micro, small and medium businesses are among the main prerequisites of growth of the modern economy, as they are able to respond to customer needs better.

19. The Law of the Republic of Lithuania on Small and Medium-sized Business Development (Valstybės žinios No 109-2993, 1998; No 132-5354, 2007) stipulates that assistance to small and medium business operators is provided pursuant to the small and medium business development programmes of the Government of the Republic of Lithuania, counties and local authorities. The assistance covers tax advantages if they are provided for in laws, also fee advantages, financial support (preferential loans, loan insurance, provision of guarantees, partial or total coverage of the interest, risk capital investment, reimbursement of certain expenses, subsidies for job creation), company consulting, training, employee qualification advancement and requalification under advantageous terms, establishment of business support institutions etc.

20. The Long-term Strategy for the Development of the Lithuanian Economy by 2015 stipulates that business development is restrained by high taxes, shortage of sources of funding for initial capital and business operations, an underdeveloped network of support institutions, ineffective provision of information and consulting on business issues, insufficient competence of entrepreneurs, excessive administration and legal regulation barriers, as well as insufficient ties among businesses and inconsistent business development in the regions.

21. The business information system is in place, however there is a shortage of data showing how many people benefit from business consulting and incubation services, and information on assistance to business and on advantages is very scarce.

22. The business services sector in Lithuania is intended for micro, small and medium-sized business as well as for start-ups. It consists of 42 business information centres, 6 business incubators and 7 science and technology parks. These institutions are public institutions. One of their shareholders is the State, represented by the Ministry of Economy. Financial assistance to projects of business services is provided from the funds of the Special Programme for the Implementation of the Strategy of the Ministry of Economy for the Development and Promotion of Small and Medium Business (Order No 4-70 of the Minister of Economy of 1 March 2007 on the Approval of Strategic Activity Plans 2007-2009 of the Ministry of Economy of the Republic of Lithuania and of Bodies under the Ministry of Economy of the Republic of Lithuania).

23. Business information centres operate in the territories of one or several municipalities, provide business information and consulting services under advantageous terms, and organise information dissemination events and training on various business management and development-related subjects. 33 business information centres have websites containing information on their activities and services rendered. Business information centres that have not yet created their websites provide this information by phone or e-mail.

24. Information to entrepreneurs is supplied by the public institution Lithuanian Development Agency. The website www.verslovartai.lt has been created to provide companies with information. Start-up entrepreneurs may obtain knowledge on business in the European Union at the European business information centres in Kaunas, Vilnius and Klaipėda. Innovative businesses rent premises and equipment, also receive business information, consulting and training cervices under advantageous terms from six business incubators and seven science and technology parks. Business incubator services are oriented to businesspeople who have good business ideas.

25. Upon entry into force of the Law of the Republic of Lithuania on Support for Employment (Valstybės žinios (Official Gazette) No 73-2762, 2006), financial incentives were established for job seekers as well as persons seeking self-employment encouraging them to undertake private business. A micro or a small undertaking whose founder is a former unemployed person having started his own business, may, within 36 months from the day of registration of the company, receive assistance for establishing a workplace provided that an unemployed person directed by the territorial labour exchange office is employed in that workplace. The subsidy per workplace may amount to the sum of 22 national average monthly wages, as last announced. An employer (the founder of a small or medium-sized enterprise) must cover at least 35 per cent of the costs of establishing a workplace (workplaces) and must maintain the established workplace(-es) for at least 36 months from the employment of the persons directed by the territorial labour exchange offices.

26. In order to help entrepreneurs deal with the problem created by the requirement of a security for a bank loan to finance promising business, Resolution No 887 of the Government of the Republic of Lithuania of 11 July 2001 on the Development of Small and Medium Business (Valstybės žinios (Official Gazette) No 62-2272, 2001) established a guarantee institution, private limited company Investicijų ir Verslo Garantijos (hereinafter referred to as "INVEGA"), while Resolution No 912 of the Government of the Republic of Lithuania of 22 August 1997 on the Rural Credit Guarantee Fund (Valstybės žinios (Official Gazette) No 79-2009, 1997; No 57-2542, 2003) established the private limited company Rural Credit Guarantee Fund (hereinafter referred to as "the Fund").

27. The Ministry of Agriculture performs the supervisory functions of the Fund. INVEGA and the Fund provide business credit guarantees to banks and partially cover the loan interest. Business credit guarantees are granted to banks extending loans to micro, small and medium businesses. The mentioned private limited companies are in a position to grant loans intended primarily to finance investments and circulating means as well as to implement innovative ideas. As a rule, granting of small loans is limited due to expensive administration.

28. Business support by local authorities encompasses assistance from the small and medium business promotion funds, i.e. reimbursement of interest rates and taxes, financing of preferential loans and target projects, support for training and events intended for entrepreneurs, decisions regarding taxes and fees (the land tax, the personal income tax imposed on holders of a business certificate, the real estate tax etc), provision of other advantages from municipal budgets, and granting of subsidies and compensations to undertakings creating new jobs.

29. Initiated by the Ministry of Economy in 2005, the analysis of the methods of entrepreneurship education in different target groups (youth, women) confirms that very significant tools to assist youth business include financial assistance to start-ups, specialised loan funds, preferential loans and business advantages for youth business. Advantages are already applied in Lithuania, however they are not oriented towards young people in business, but directed to small businesses and social enterprises, depending on a decision by national or local authorities.

30. The administrative procedures (regulatory requirements, in particular the ones related to business establishment and accountability to the state; filling in of declarations and reports, forms, licences and other required permits) were identified in the surveys as inflexible and complex, especially to young people. However, the main reason for that could also be the lack of knowledge of regulation and rules.

31. Not all youth potential is utilised for the benefit of Lithuania's regional development. Failure to adapt to the changed economic and social conditions in Lithuania result in youth moving from rural areas to the cities as well as emigration from Lithuania. Therefore, absence of adequate conditions for entrepreneurship is an indirect influence on youth migration.

32. According to the data of the Department of Statistics under the Government of the Republic of Lithuania (hereinafter referred to as "the Department of Statistics"), 7 000–15 000 residents left Lithuania in the period 2002-2004, while throughout 15 years of independence the total emigration figure amounted to 230 000. On 19 July 2006, the Seimas of the Republic of Lithuania passed the Resolution on a Consistent State Policy to Control the Emigration Processes (Valstybės žinios (Official Gazette) No 81–3200, 2006) and urged the Government of the Republic of Lithuania to submit to the Seimas of the Republic of Lithuania a state policy concept regarding the control of emigration processes.

33. The objective of this Programme is to develop a consistent and effective system of responsible business education for young people.

34. To achieve the Programme objective, the following tasks are envisaged:

35. The envisaged Programme implementation results:

36. The following will be the criteria for the assessment of the implementation of this Programme (the monitoring bodies are specified in parentheses):

            37. The Ministry of Social Security and Labour shall coordinate and control the implementation of this Programme and, before March 1 every two years, shall submit a report on the implementation of the measures to the Government of the Republic of Lithuania.

38. This Programme shall be implemented from the general appropriations approved for the responsible implementing bodies in the Law of the Republic of Lithuania on the Approval of Financial Indicators of the State Budget and Municipal Budgets of the respective year, European Union structural funds and other legislative acts.

39. The plan of implementing measures under this Programme (tasks, measures, implementation period, preliminary need for funds and responsible implementing bodies) is presented in the annex to this Programme.