Lithuania

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Surprisingly, the harsh and protracted lockdown measures introduced at the beginning of the year had only a slight dampening effect on retail trade and GDP growth (+1% year on year in Q1 2021). Swiftly increasing external demand was driven by, among other things, the need for Lithuanian chemicals for use in COVID-19-related pharmaceutical production elsewhere. Short-time work schemes served to cushion the rise of unemployment. However, it will take some considerable time for those workers affected to be reabsorbed by the labour market.

Given the higher-than-expected growth in household consumption and exports, we have substantially raised our GDP growth forecast for 2021 from 1.8% to 3%. For 2022, investment will be driven by expanded public spending. The steadily and rapidly rising real wages and the higher savings accumulated during the lockdowns will be used by households in 2022 to boost consumption. However, the newly introduced EU sanctions against Belarus will adversely affect the Lithuanian transport sector, since Belarus’s most important export products – such as oil products and potassium fertiliser – are shipped via the Lithuanian port of Klaipeda.
        FORECAST*
Main Economic Indicators201820192020202120222023
Population, 1000 persons280227942795...
GDP, real change in %3.94.3-0.93.04.03.5
GDP per capita (EUR at PPP)246402604025880...
Gross industrial production, real change in %4.83.4-1.8...
Unemployment rate - LFS, in %, average6.26.38.58.57.36.5
Average gross monthly wages, EUR92412961429...
Consumer prices, % p.a.2.52.21.12.02.73.3
Fiscal balance in % of GDP0.60.5-7.4-6.0-3.0-2.0
Public debt in % of GDP33.735.947.1...
Current account in % of GDP0.33.38.35.14.23.3
FDI inflow, EUR m109614021337...
Gross external debt in % of GDP78.167.774.2...


Basic data are continuously updated.

* Forecasts are changed beginning of April, July and November.
See Press Conferences.

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Monthly Report No. 7-8/2021

Vasily Astrov, Alexandra Bykova, Rumen Dobrinsky, Selena Duraković, Richard Grieveson, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanovic, Niko Korpar, Sebastian Leitner, Isilda Mara, Olga Pindyuk, Leon Podkaminer, Sandor Richter, Bernd Christoph Ströhm and Maryna Tverdostup
wiiw Monthly Report No. 7-8, July-August 2021
42 pages including 4 Tables and 15 Figures

Details

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LITHUANIA: Recession prevented, revival delayed

Sebastian Leitner
in: Darkest before the dawn?
wiiw Forecast Report No. Spring 2021, April 2021 , pp. 90-93
Details and Buy


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