Lithuania

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Lithuania became an independent state in 1990. Since then, it has gradually moved from a centrally planned economy to a free market economy. After its independence, the country started a process of privatization aimed at liberalizing the economy. For the last couple of years, the economy has been experiencing strong growth and is potentially very attractive. The GDP growth rate was 7.6% in 2005, 7.5 in 2006 and 8.0% in 2007. It is expected that Lithuania will have the strongest economic development between Baltic states. Private consumption and foreign investments are mainly driving the economic growth. It should be noted that Lithuania receives a quite substantial amount of financial support from the European Union which is also a good opportunity to modernize the country's different sectors.

GDP Indicators	2006	2007	2008	2009	2010
GDP (billions USD)	30.08	38.89	48.75e	52.37e	57.16e
GDP (constant prices, annual % change)	7.9	8.9	3.9e	0.7e	2.6e
GDP per capita (USD)	8,863.07	11,514.65	14,456.17e	15,553.50e	17,001.26e
Inflation rate (%)	3.8	5.8	11.3e	6.2e	8.5e
Unemployment rate (% of the labor force)	5.6	n.c.	n.c.	n.c.	n.c.
Current Account (billions USD)	-3.22	-5.69	-7.27e	-4.54e	-4.32e
Current Account (in % of GDP)	-10.7	-14.6e	-14.9e	-8.7e	-7.6e

Source: IMF - World Economic Outlook Database; ILO, Laborstat - Yearly Statistics

Note: (e) Estimated data

Socio-demographic indicators	2004	2005	2006
Unemployment rate (%)	11.4	8.3	5.6

Source:

Main sectors of industry

The main industrial sectors of Lithuania are: electronics, chemicals, machine tooling, metal processing, construction materials, food processing and light industry, including the manufacturing of textiles, clothing, furniture and household appliances.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	13.4	7.3	4.5
Value added (in % of GDP)	5.1	33.3	61.5
Employment by sector (in % of total employment)	0.0	0.0	0.0

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2003	2004	2005	2006	2007
Average annual exchange rate for 1 USD	3.06	2.78	2.77	2.75	2.52

Source: World Bank - World Development Indicators

Foreign trade in figures

In 2007, Lithuanian exports and imports were worth 12.5 billion EUR and 17.8 billion EUR respectively. In 2007, the volume of exports and imports rose by 11.2% and 14.5% respectively in comparison with 2006. Therefore, Lithuanian foreign trade is in deficit as imports are greater than exports. In 2007, Russia was Lithuania's main export partner. Other equally significant trade partners are Latvia, Germany and Poland. The majority of exports went to European Union member countries. The top import partners are: Russia, Germany, Poland, the Netherlands, Latvia. The country mainly imports mineral fuels & oils, vehicles, electric & electronic equipment, and plastics.

Foreign trade indicators	2003	2004	2005	2006	2007
Imports of goods (millions USD)	9,362	11,689	14,690	18,360	n.c.
Exports of goods (millions USD)	7,658	9,306	11,774	14,151	n.c.
Imports of services (millions USD)	12,636	16,321	2,055	25,400	n.c.
Exports of services (millions USD)	1,878	2,444	3,104	3,623	n.c.
Imports of goods and services (annual % change)	10.4	14.9	17.2	13.8	9.1
Exports of goods and services (annual % change)	6.9	17.7	12.2	4.7	n.c.
Imports of goods and services (in % of GDP)	57.1	59.2	65.4	70.1	67.4
Exports of goods and services (in % of GDP)	51.3	52.1	58.1	59.7	55.4
Trade Balance (millions USD)	-1,704	-2,383	-2,916	-4,209	n.c.
Trade Balance (including service) (millions USD)	-1,090	-1,570	-1,866	-3,126	n.c.
Current Account (millions USD)	-1,278	-1,725	-1,831	-3,218	n.c.
Current Account (in % of GDP)	-6.9	-7.7	-7.1	-10.8	n.c.
Foreign trade (in % of GDP)	108.4	111.4	123.4	129.8	122.7

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
Russia	12.8%
Latvia	11.1%
Germany	8.6%
Estonia	6.5%
Poland	6.1%

Main suppliers (% of imports)	2006
Russia	24.2%
Germany	14.9%
Poland	9.5%
Latvia	4.8%
Netherlands	3.7%

Source: 2006

Main products

Main exports (% of exports)	2006
Mineral fuels, mineral oils	23.5%
Vehicles other than railway or tramway	8.0%
Electrical machinery and equipment	6.5%
Machinery and mechanical appliances	6.1%
Furniture, bedding, mattresses, cushions	5.7%

Main imports (% of imports)	2006
Mineral fuels, mineral oils	22.4%
Vehicles other than railway or tramway	12.4%
Machinery and mechanical appliances	10.3%
Electrical machinery and equipment	7.3%
Plastics	4.3%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: Ministry of Economy
Ministry of Finances
Statistical Office: Department of Statistics
Central Bank: Central Bank of Lithuania
Stock Exchange: Nordic Exchange
Online newspapers: Akropolis
Lieutvos Rytas (in Lithuanian)
Search Engines: Google
Search.lt
List Lithuania
Lithuania on line
Economic portals: The Baltic Times

Political outline

Executive Power: The President is the chief of state and is elected by popular vote for a five-year term. He/she is also commander in chief overseeing foreign and security policy. The Prime Minister is the head of the government and is appointed by the President on approval of the Parliament (generally leader of the majority party or coalition) to serve a term of four years. The Prime Minister enjoys the executive powers which include implementation of the law in the country and running the day-to-day affairs. The Council of Ministers (cabinet) is appointed by the President on the nomination of the Prime Minister.
Legislative Power: The legislature is unicameral in Lithuania. The Parliament (called Seimas) has a single chamber and consists of 141 seats. Members of the Parliament are elected using a mixed system combining proportional and single constituencies; this means that 71 members are directly elected by popular vote, 70 are elected by proportional representation; all members serve four-year terms. A party must receive at least 5% of the national vote to be represented in the Seimas. The Prime Minister cannot dissolve the Parliament (but President can do so on recommendation of the Parliament) nor can veto its enactment .
Main political parties: Lithuania has a multi-party system in which a single party does not have the chance of gaining power alone. So parties work with each other to form coalition governments. Some of the major parties in the country are:
- LSDP (Social Democratic Party of Lithuania) – advocates social democracy, has communist background.
- VNDS (Peasants and New Democratic Party Union) - an agrarian-conservative political party.
- TS (Homeland Union) – a right-wing conservative political party.
- DP (Labour Party) – advocates globalization and free-market economy in entire Europe; centrist.
- Liberal Democratic Party – a right-of-centre political party.
Current political leaders: President: Valdas ADAMKUS (since July 2004) – non-partisan
Prime Minister: Gediminas KIRKILAS (since July 2006) – Social Democratic Party, heading a coalition government
Next election dates: Presidential: June 2009
Parliamentary: October 2012 (last elections held in 2008)