EU – Baltic States, Financial Services, Legislation, Lithuania, Markets and Companies

Lithuania has strengthened the governance of SOEs, with more than 60% of board members now being professionals rather than public servants, but only half of SOEs reached their financial objectives in 2018, the Paris-based organization said in its latest Economic Survey of Lithuania.  

"Against this background, the government should continue to subject SOEs to the same laws, regulations and market constraints as private companies, and if no compelling reasons persist to maintain public ownership, sell them," it said.   

Lithuania still lacks a clear strategy that defines "the rationale for public ownership", according to the OECD.  

It noted separately that that there are no private rail service providers in Lithuania, calling on the government to create the conditions for them to emerge.

The state must have a long-term debt reduction strategy, but only when the economy begins to recover from the coronavirus crisis, the secretary-general of the Organization of Economic Cooperation and Development (OECD) said on Monday. 

This holds true for the whole world, not only Lithuania, Angel Gurria said at an online news conference following the presentation of the OECD's latest Economic Survey of Lithuania to the Lithuanian president and other officials.  

"Public debt is growing because of all the measures. When the state begins to recover, the government should set long-term debt targets and a long-term debt reduction strategy. But only when the ecohomic recovery is well on its way," the secretary-general said. “You have to put everything you have against the pandemic, all the resources that you need. 2021 is still going to be the year we are going to be fighting the virus. Make sure there are all the necessary weapons, at least fiscally," Gurria said.  "You have to win the battle against the virus first,” he added.

Most banks and institutions forecast that Lithuania's debt will be close to 50 percent of GDP this year and will cross the mark next year.

Outgoing Finance Minister Vilius Sapoka has said that Lithuania must reduce its public debt and bring it back close to 40% of GDP.