According to cheeroutdoor, Lithuania is a state with an industrial-agrarian economy. The share of industry in GDP (2000) is 51.2%, agriculture 24.7%, construction 9.8%, transport 3.6%, other areas of activity 10.1%.
The main industries are mechanical engineering, metal and woodworking, production of building materials, textile, chemical and food industries. In 2002, the Lithuanian industry produced and sold products worth 26,334 million litas, compared to 2001, the increase in constant prices was 3.1%, in the mining and processing industries 2.7%, in the electricity and gas industries 5.4%.
Agriculture employs approx. 35% of the economically active population. St. 4 million hectares of land is used by agricultural enterprises and private households. Meat and dairy animal husbandry and poultry farming are developed. The main crop production is cereals and forage crops, potatoes, sugar beets, and vegetables. In 2002, grain production was 9% more than in 2001, sugar beets – by 20%, rapeseed – by 63%, potatoes – by 45%. Structural changes continued in the countryside. Farmers and households produced 81% of grain, 64% of sugar beets, 69% of rapeseed and 99.3% of potatoes. The volume of sales of the main livestock products: livestock 141.1 thousand tons (in 2001 – 127.1), milk 1140.6 thousand tons (in 2001 – 1152.8), eggs 517.7 million pieces. (in 2001 – 480.8). In 2002, 190 million litas were allocated for the development of rural areas and agriculture, in 1,
In 2002, the volume of retail trade turnover amounted to 15,640 million litas, up 12.4% (in constant prices) compared to 2001, and the volume of services – 17.1%. The volume of wholesale trade increased by 13.7% (in current prices) and amounted to 18,972.1 million litas.
Lithuania can be divided into 4 economic regions: in the east, there are various enterprises of mechanical engineering, woodworking and light industries (this is the main resort area); in the southern part hydroelectric power stations, food industry and metalworking enterprises, the main agricultural lands are concentrated; the north specializes in the production of winter crops, flax and sugar beets; in the west, shipbuilding and the ship repair industry, and fishing are developed. Lithuania provides itself with electricity. Energy is based mainly on imported fuel. The largest power plants: Kaunas hydroelectric power station, Lithuanian state district power station, Ignalina nuclear power plant.
The transport network in Lithuania is quite developed. The length of the railway tracks is approx. 3 thousand km, roads – 44.5 thousand km. The main seaport is Klaipeda (design capacity is 30 million tons per year). There is a ferry crossing Klaipeda-Mukran (Germany). There is a main gas pipeline (length 1,400 km) with branches, the Polotsk-Birzhai-Mazeikiai oil pipeline, and an offshore oil terminal in Butinga with a throughput capacity of 16 and 8 million tons per year, respectively. Airports: in Vilnius, Kaunas and Palanga, cargo – in Siauliai. The main telephone communication enterprise is Lietuvos Telekomas.
Lithuania is consistently pursuing economic reforms coordinated by the IMF and the World Bank, the core of which is privatization (the private sector now produces over 80% of the country’s GDP). In the beginning. Summer 2001 Lithuania joined the WTO. According to the European Commission, Lithuania is a country with a market economy, and joining the EU will strengthen its economic security and macroeconomic stability.
Over the years of sovereign existence, the country has experienced a fairly long (5 years) and deep economic recession. In 2000, GDP in Lithuania amounted to 67% of the 1990 level, the volume of industrial production decreased by 44%, agricultural production – by 30%. The Russian monetary and financial crisis of 1998 had a devastating effect on the Lithuanian economy. The material expression of these losses, according to official data, amounted to 700 million litas, or 8% of budget revenues. Many enterprises were declared bankrupt, by the end. In 1998, 274 enterprises were liquidated (food, dairy and meat processing, textile and metalworking industries), exporting products mainly to the Russian Federation. The volume of exports to the Russian Federation decreased by 76.3%, imports – by 41.3%. Accumulated financial resources in advance and a rather tough credit and financial policy helped to overcome the consequences of the Russian crisis. Slow growth in industrial and agricultural production began in 2000.
GDP dynamics in Lithuania in the 1990s had a trend inherent in all transitional economies – a strong decline was replaced by unstable growth. At the same time, exports and foreign investment remained the main sources of growth in the face of limited domestic demand. The volume of GDP in 2002 (in constant prices) amounted to 50,805.2 million litas, an increase of 6.7% compared to 2001. Significant positive changes were observed in all sectors of the economy, with the exception of the mining, mining and fishing industries, where the increase in the volume value added amounted to only 0.7%. The largest increase was in construction (12.8%), wholesale and retail trade (8.7%), transport and communications (12.6%), and financial services (10.6%). In the manufacturing industry, it amounted to 5.5%, in agriculture and forestry – 6.1%, in hotel and restaurant services – 7.6%, in electricity, gas and water supply – 5.4%. The GDP growth in 2002 was achieved largely due to the growth of labor productivity and the increase in hours worked.
The volume of exports in 2002 increased compared to 2001 by 10.6% and amounted to 5472.3 million US dollars, imports – by 11.0% and reached 7615.4 million US dollars. In 2002, the EU countries accounted for 48.4% of exports and 45% of imports, while the CIS countries accounted for 19.2% and 26.2%, respectively. The main export partners were: Great Britain (13.5%), Russian Federation (12.1%), Germany (10.3%), Latvia (9.6%), imports – Russian Federation (21.4%), Germany (17.2%), Italy (4.9%), Poland (4.8%).
The unstable dynamics of the world economy and the negative trends in the development of the EU countries (economic slowdown) in recent years have a direct impact on the Lithuanian economy. This is directly related to the small export opportunities and the increase in imports. At the same time, the growing demand for Lithuanian goods in the CIS countries should be noted. The country managed to partially compensate for losses in the EU markets by more active entry into the markets of the CIS countries, exports to which grew by 12% in 2002. The share of the Russian Federation in Lithuanian exports is growing steadily – from 7.1% in 2000 to 12.1% in 2002.
The Lithuanian economy needs the Russian market. The foreign economic relations of the Russian Federation with Lithuania are based on bilateral agreements and practical cooperation. The volume of trade between them in 2002 amounted to 1980 million US dollars, exports of the Russian Federation to Lithuania – 1670 million US dollars, and imports from Lithuania to the Russian Federation – 309 million US dollars. The negative balance for Lithuania has recently been somewhat reduced, but not in kind, but only in value due to price changes. In the coming years, trade between the two countries is expected to double at least. The Russian Federation remains a major trading partner due to the high activity of both Lithuanian and Russian entrepreneurs. There are 840 joint ventures operating in Lithuania and 215 with purely Russian capital ($16.1 million), mainly engaged in trade and intermediary activities. Relatively large investments were made by the Russian companies Gazprom and LUKOIL. RAO Gazprom invested in the gas marketing company CJSC Stella Vitae. The transit of Russian cargo remains an important element of the national economy of Lithuania. The volume of these services significantly exceeds commodity exports to the Russian Federation in value terms. The Russian Federation is provided with services for the transportation and transshipment of oil and oil products, fertilizers, metals and a number of other goods. Income from the transit of these goods in the budget of Lithuania is approx. 25% ($350-400 million per year). The transit of Russian cargo remains an important element of the national economy of Lithuania. The volume of these services significantly exceeds commodity exports to the Russian Federation in value terms. The Russian Federation is provided with services for the transportation and transshipment of oil and oil products, fertilizers, metals and a number of other goods. Income from the transit of these goods in the budget of Lithuania is approx. 25% ($350-400 million per year). The transit of Russian cargo remains an important element of the national economy of Lithuania. The volume of these services significantly exceeds commodity exports to the Russian Federation in value terms. The Russian Federation is provided with services for the transportation and transshipment of oil and oil products, fertilizers, metals and a number of other goods. Income from the transit of these goods in the budget of Lithuania is approx. 25% ($350-400 million per year).
The economic role of the Russian Federation for Lithuania is largely determined by the supply of energy resources. Its main import needs for gas, oil and nuclear fuel for the Ignalina NPP are mainly met by Russian supplies. The share of the Russian Federation accounts for St. 85% of Lithuanian mineral products imports. A number of Lithuanian industries work on the processing of Russian raw materials (oil, timber, metals, etc.) with the subsequent export of manufactured products to the markets of third countries. Lithuania is an economic bridge between the European Union and the Russian Federation, providing transport infrastructure and energy highways between the Kaliningrad region and the rest of the Russian Federation. The Kaliningrad region accounts for approximately 1/4 of Lithuanian deliveries to the Russian Federation,
The reduction in demand in foreign markets had a downward effect on the dynamics of consumer prices. The trade deficit increased markedly. The increase in the balance of payments deficit was counteracted by a very tangible influx of investments from abroad. The increase in foreign direct investment (FDI) in Lithuania in 2002 amounted to 24% (the volume of FDI accumulated at the beginning of 2002 was 2.4 billion US dollars, or 649 dollars per capita). The largest foreign investors are Sweden, the USA and Finland (43% of all foreign investments).
The economic development of Lithuania in 2003 was still determined by the dynamics of demand in the domestic market. Some growth in consumption became possible due to the increase in wages, the expansion of opportunities for obtaining loans from commercial banks. Lithuania has a two-tier banking system, consisting of a central bank (the Bank of Lithuania) and more than 20 commercial and specialized banks. The total share of government shares in the commercial banking sector is 35%.
Total government debt to con. 2002 amounted to 13,162.8 million litas, external debt – 9,177.8 million litas.
In 2002, GDP per capita reached 4.0 thousand euros (in 1998 – 2.9 thousand). The average monthly wage was $272, the minimum was $107, the average pension was $80, and the average family income per person was $105. Pensions increased by an average of 5%, a provision was legalized to increase small pensions, covering more than 300,000 old-age and disability pensioners. Currently, old-age pensions are received by women who have reached the age of 57.5 years, men – 61.5 years (in 2009, the retirement age for women will increase to 60 years, and for men to 62.5 years). Food accounted for 50% of all expenses. Over the past 3 years, the difference between the poorest and richest segments of the population has decreased from 13 to 9 times.
The number of employed in 2002 amounted to 1,406,000 people, an increase of 4% as compared to 2001. Unemployment, although it decreased from 12.5 to 11.3%, remains quite high, 198.4 thousand people were registered. unemployed (in 2001 – 223.5).