Analytics, Economics, EU – Baltic States, Financial Services, GDP, Lithuania

As compared to the Commission’s forecasts published last November, the estimate of Lithuania’s GDP growth in 2015 was revised down by 0.1 percentage point, from 1.7%, while forecasts for 2016 and 2017 were left unchanged.

“The European Commission's forecasts for Lithuania are basically favorable. They show that more robust domestic consumption and recovering exports should grow our economy,” Finance Minister Rimantas Sadzius said in a press release on Thursday.

“What is also important is that the Commission noted and appreciated the actual tax collection in Lithuania and accordingly improved its general government deficit forecasts, which had given rise to discussions in debates on the 2016 draft budget,” he said.

The Commission expects Lithuania’s economic growth to accelerate this year on the back of strong private consumption and export growth.

Private consumption in Lithuania is projected to increase by 4.9% and by another 3.8% in 2017. Government consumption is expected to grow by 1.4% this year and by 2% next year.

Lithuania’s exports should increase by 3.1% this year and by another 4.3% in 2017. Imports growth is expected to reach 4.1% and 5.5%, respectively.

In its winter 2016 economic forecasts published on Thursday, the EU's executive body revised its Lithuanian unemployment estimate for 2016 to 8%, down from 8.6% in the autumn 2015 forecasts.

It expects that harmonized average annual inflation in Lithuania, which reached minus 0.7% in 2015, will stay in negative territory this year, at minus 0.1%, compared with its previous forecast of a 0.6% rise in consumer prices. However, in 2017, consumer prices in the country should rise by 2.1%.