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The Lithuanian GDP is diversified. Trade and services constitute approximately 60 percent of it, the industrial sector just under 20 percent and primary agriculture and fisheries at about 3 percent. Lithuania was one of the fastest countries to recover from the global recession of 2008, with the economy returning to growth figures as early as 2009.
The GDP of Lithuania stood at 36.3 billion euros in 2014, with gross domestic product per capita of 12,093 euros. The inflation rate is steady 0.2 percent for the same period. Debt to GDP ratio is 39.7 percent, which, despite the government’s austerity measures, is rising.
Wages and salaries are quite low by European standards and bring about emigration of Lithuanian nationals to countries with higher wages. However, the government has increased the minimum wage in 2015 by 10 euros to 300. Despite this the current unemployment rate is high by European standards, at 10.7 percent.
Foreign trade is developing positively. However, because of the Ukraine crisis, it decreased for the first time in recent years in 2014 – exports fell by 0.6 percent, while imports rose by 1.2 percent. Russia, Lithuania’s chief oil provider, remains the most important trading partner of the country. Other important ones are the Baltic and Nordic countries, Poland and Germany. Main export commodities are food, furniture and wood, plastics, fertilizers and metal products. An important point to mention is Lithuania’s abandonment of the lita; it adopted the euro in January, 2015.
Lithuania is highly dependent on energy imports. The share of its own primary energy sources (biomass and wood waste) in energy production is approximately 20 percent. Due to this prices for electricity and heating heat (mainly fueled by gas) are high.
Lithuania wants to weaken the dependence on gas and electricity imports from Russia, which meet 75 percent of its demand, for political reasons and has therefore built up an alternative infrastructure for energy supply. An LNG terminal was commissioned in late 2014. Furthermore, the completion of power bridges to Sweden and Poland is expected by 2015/16.
Why invest in Lithuania?
- Lithuania is termed as the gateway to the East in Europe because of its excellent infrastructure. It has one of the densest road networks in Europe, as well as one of the fastest and most reliable internet service.
- Lithuania is ranked as 11th in the Ease of Doing Business ranking of 2015. This is primarily due to the robust internet based mechanism of the country and favourable legal conditions.
- Lithuania has tax treaties with 50 of the biggest markets in the world, including the likes of USA, Russia and China. Thus affording a truly global reach to its businesses
- The country also has one of the best-educated workforces in Europe. 90 percent of Lithuania’s population has secondary or higher education. In addition, the country is among 5 European nations with the highest percentage of people speaking a foreign language.