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Gold received from the Soviets

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On 12 July 1920, the Peace Treaty between Lithuania and the Soviet Russia was signed in Moscow. The fact that peace was established with a strong, yet not very trustworthy, neighbour is not its only significance. The Treaty was also significant to Lithuania in introducing its own money.


The fight for independence that lasted until 1920 turned out to be quite successful to Lithuania, as the main opponents were forced out of Lithuania’s territory and the country started gaining its strength. At the time, the Red Army was fighting on several fronts and was in the need of additional allies. At the end of 1919, it retreated from Lithuania, giving rise to lengthy peace negotiations that concluded on 12 July 1920. The main clause of the Treaty was that Russia recognises Lithuania’s sovereign territory and waves any claims to it forever (unfortunately, as we know, “forever” meant about 20 years to the Soviets). The Treaty was significant on another aspect as well. According to it, Russia had to compensate the losses incurred by Lithuania during the occupation and wars. Even though not all of Lithuania’s demands were taken into consideration (e.g. to return historical values or resident deposits), the country was released from the national debt of the Russian Empire and, to compensate war damages, the Soviets allocated around 100,000 dessiatins (roughly 90,000 hectares) of forests and 3 million gold roubles. The gold was brought to Lithuania even before the deadline set out in the Treaty. It was delivered to Vilnius on 8 October 1920 and handed over to the Lithuanian government. The gold was brought in the form of the 1902-issue coins and their total weight reached nearly 2.5 tonnes. It was used to overcome financial struggles and half of it was mortgaged at the private bank Ūkio Bankas to receive a 40 million auksinas loan which was repaid on time and without any loss. The accumulated gold was used to form gold reserves which then served as the basis for the litas adopted in 1922. During the interwar period, the litas was directly convertible into gold – 1 litas was equal to 0.150462 grams of gold. Approximately 9.5 tonnes of this precious metal were accumulated until Lithuania’s occupation.
 

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Last updated: 2021-06-25