Lithuania Business News: Archive 2003-
Saturday, 20th of September
Lithuania Power Plant completed the installation of the new equipment
State-run Lietuvos Elektrine (Lithuanian Power Plant, or LPP) has completed the installation of new desulphurization or flue gas treatment equipment. Advanced emission-reducing equipment was installed at the 7th and the 8th units. Investments into new equipment totalled 90 million euros granted by the European Union (EU). LPP shall be fully upgraded by the closure of Ignalina Nuclear Power Plant (INPP) late in 2009. Upgrade projects are financed by the EU resources administered by the European Bank for Reconstruction and Development (EBRD). LPP is considered a strategic company, which will replace INPP as the main Lithuania' source of electricity after 2009.
Agrowill Group raises LTL 8.961 million via public placement
Agrowill Group, the largest Lithuania's agricultural investment company, has raised LTL 8.961 million via public placement of new share issue for small shareholders. New shares were also subscribed by the investment company ZIA Valda, which shall pay LTL 17.922 million for the securities in one year. Including new stocks, ZIA Valda now owns almost 32 percent of Agrowill Group. Total receipts of Agrowill Group on the overall issue will make up LTL 26.88 million, which will be invested into business expansion. With the issue placed, the authorized capital of Agrowill Group rose to LTL 30.778 million, from LTL 26.143 million.
People in Lithuania would agree to work around 30 hours weekly for an average monthly salary, which currently stands at LTL 2,240, a survey showed on Friday. The research company RAIT and the Lithuanian Free Market Institute (LFMI) conducted this survey in July. The survey has revealed that people know how much they want to be paid for their work and would work overtime for this salary, Giedrius Kadziauskas, a senior expert with the LFMI, said. “People whose per capita household income is the lowest, up to LTL 500, are more inclined to work for the same wage. On average, they would work three hours longer compared with the overall average," RAIT Chairwoman Inga Nausediene said.
Friday, 19th of September
Lack of resources
The Lithuanian government this year will likely fail to build the full amount of oil product stocks it is required to hold as the authorities have fallen around LTL 65 million short of the funds needed for this purpose. The Cabinet on Thursday approved a proposal from Economy Minister Vytas Navickas to take LTL 35 million out of the Ignalina Nuclear Power Plant's decommissioning program, which is administered by the Economy Ministry, and use the money for building oil product reserves. The Finance Ministry says that it cannot raise the remaining LTL 30 million. Navickas said that the authorities had informed the EU's institutions that the country lacked money for oil product stocks. The state now has to cover 50 percent of the costs of building and maintaining 90 days of oil product reserves, with the remaining 50 percent shared by businesses.
Lietuvos Zinios, Lietuvos Rytas
Omnitel suffered the most
Omnitel lost the biggest number of its clients (16,4 thousand) due to the number relocation service in Lithuania during the second quarter of the year. Bite was on the second place according to the number of lost clients (5,7 thousand), while Tele2 was the third (3 thousand), the data of Communications Regulatory Authority shows. Tele2 was leading in terms of the number of clients who transferred to the operators (12,4 thousand). While Bite Lietuva attracted 9 thousand and 4.3 thousand transferred to Omnitel. The alternative mobile connection operators lost 1.6 thousand of subscribers due to the number relocation services.
Kauno Diena, Lietuvos
RytasProjections and changes in the new nuclear power plant project
With current price regulation system in effect, Lithuania's national investor company Leo LT sees it possible to initially build two units of new nuclear power plant with a combined capacity of 2,200 MW, i.e. one-third less compared with the maximum possible capacity. The investments of company's shareholders into Visaginas Nuclear Power Plant (VNPP) would reach some LTL 14 billion, while total investments into the implementation of all strategic projects would be some LTL 17 billion. On Wednesday Leo LT's supervisory committee, which is chaired by Prime Minister Gediminas Kirkilas and includes the ministers of economy, justice, interior, environment, agriculture, finance and foreign affairs, approved the long-term operating strategy of the company, the government press service confirmed. The strategy outlines optimistic and pessimistic forecasts as to the timing of completion of strategic projects. In line with the strategy, power links with Poland and Sweden should be built in 2014 and 2015, respectively. The first unit of new nuclear power plant should be launched in 2016-2018 and the second one - in 2019-2020. The plant's capacity would be sufficient, and Lithuania's share of output would reach some 1,300 MW, while the remainder would be shared by the project partners, Leo LT head Rymantas Juozaitis said.
Verslo Zinios, Kauno Diena
Thursday, 18th of September
Dvarcionys Ceramics posts figures
Dvarcioniu Keramika (Dvarcionys Ceramics), the only manufacturer of ceramic tiles in the Baltics, posted LTL 49.6 million in sales in the first eight months of this year, up 7 percent versus the year-earlier. In August alone, the sales increased by 5 percent, year-on-year, to LTL 7.8 million, the company said in a statement. Eight-month exports to Russia soared by 68 percent, Belarus - 59 percent, and Ukraine - 50 percent. Poland's Cersanit owns 78.22 percent of Dvarcioniu Keramika.
The European Commission refuses to listen to Lithuania
The extension of lifespan of Lithuania's Ignalina Nuclear Power Plant (INPP) is not being discussed, European Commission President has reiterated. "Ignalina [the closure of facility] - to be very clear - is the legal commitment in [Lithuania's EU accession] Treaty. Legal commitments are not an issue to be discussed between Lithuania and the EC. As guardian of the Treaties the Commission can only say: Treaties must be respected," Jose Manuel Barroso said during a joint news conference with Lithuania's Prime Minister Gediminas Kirkilas in Brussels on Wednesday. As part of its pre-accession commitments, Lithuania has obliged to close INPP down by the end of 2009. Yet, the government seeks to agree with the EC on gradual switch-off of the facility thus extending its operations by at least mid-2012.
Respublika, Lietuvos Zinios, Kauno Diena, Lietuvos Rytas
Problems with Lithuania Polish power grid ling project
The implementation of a Lithuanian-Polish power grid link project has been hampered by disagreement between the neighboring countries over a 2-million-euro grant issued by the European Bank for Reconstruction and Development (EBRD) last summer. The two countries and the bank will look for ways to simplify the financing structure. "We are discussing how to normalize financing models, particularly those related to the EU institutions," Lithuanian Economy Minister Vytas Navickas said on Wednesday after meeting with the heads of LitPol Link, a Lithuanian-Polish joint venture responsible for the so-called "power bridge" project. "Since the EBRD is the administrator of the Ignalina International Decommissioning Support Fund, it is important that we establish a clear relationship with the bank to ensure that this project is financed smoothly and as efficiently as possible," he told reporters. Navickas said that officials from the European Commission, the EBRD and all three companies involved in the project --Lietuvos Energija (Lithuanian Energy), Poland's PSE Operator and LitPol Link -- are expected to meet in Brussels or Luxembourg next week to try and simplify the financing model. "Simplicity means promptness for us," he said.
Verslo Zinios, Respublika
Wednesday, 17th of September
FlyLAL offers flights to Madrid and Budapest
Lithuania's flagship carrier FlyLAL-Lithuanian Airlines will offer flights to Madrid and Budapest during the winter season from October 26 till March 29. "These are very important cities both for passengers who intend to visit the capitals of Spain and Hungary and for those who intend to fly further to Southern or Central Europe. Madrid and Budapest are important transit hubs," Liutauras Tarabrinas, deputy director of FlyLAL development department, said at a news conference on Tuesday. The winter schedule of the carrier will include direct flights to Amsterdam, Budapest, Frankfurt, Kiev, London, Madrid, Moscow, Paris, Rome, Istanbul and Tallinn.
Respublika, Kauno Diena, Lietuvos Rytas
Works will be finished earlier
Ignalina Nuclear Power Plant (INPP), which stopped its sole running unit for scheduled maintenance early in August, intends to complete the works a week earlier than planned, and the first turbine of the second unit will be switched on September 22. "We will try to switch the first turbine on earlier - next Monday instead of Sept. 30, as planned previously. It cannot be guaranteed, yet this is our objective. If everything goes smoothly, we will launch the second turbine several days before October 5, as planned before," Viktor Shevaldin, INPP CEO,said. Maintenance would probably be finished earlier than planned since some installations needed no repairs although were included into the maintenance list, he said. With INPP closed for almost two-month maintenance, Lithuania has to import electricity to cover its needs. Kauno DienaLithuania court seizes more than LTL 8 million worth of assets of Mazeikiai Oil
A Lithuanian court has temporarily seized more than LTL 8 million worth of assets of Mazeikiu Nafta (Mazeikiai Oil) at the request of Lietuvos Gelezinkeliai (Lithuanian Railways), which is seeking to recover a debt from the oil refinery. This marks the first court victory for the state-owned railway operator in its dispute with Mazeikiu Nafta, which is owned by Poland's PKN Orlen, over transport tariffs. The Siauliai regional court on Tuesday ruled to take interim precautionary measures in the lawsuit and seize LTL 8.347 million worth of Mazeikiu Nafta's movable and immovable assets, Vytautas Joncas, a public relations aide to the court's president, said. However, the court did not grant the railway operator's request to seize the oil company's bank accounts, he added.
Verslo Zinios, Respublika, Lietuvos RytasTuesday, 16th of September
SEB presents its forecasts
Lithuania's largest bank SEB forecasts that the country's economic growth will decelerate to 4 percent next year and will slow further to 3 percent in 2010. The bank's GDP growth forecast for 2009 is down from its previous estimate of 5 percent in June, but the latest projection for 2010 is unchanged. "We have revised our 2009 GDP growth forecast down to 4 percent from 5 percent to reflect the deteriorating situation in the domestic market, as well as the slowing down of economic activity in Great Britain and the United States, and particularly in the neighboring Baltic States," the bank said in its latest Lithuanian Macroeconomic Review report released on Monday. "Our GDP growth forecast for 2010 remains unchanged at 3 percent," it said. SEB predicted that the country's fiscal deficit would reach 1.5 percent in 2008 and would stay at this level in 2009 before widening to 2 percent in 2010. The latest forecasts are each increased by 0.5 percentage points compared with those in the previous report. The bank left its forecasts for the country's EU-harmonized annual average inflation rate unchanged from June, at 11.5 percent for 2008, at 8 percent for 2009 and at 11 percent for 2010.
Lietuvos Rytas, Lietuvos Zinios, Respublika, Verslo Zinios
Achema Group to join the new project
The Lithuanian Economy Ministry proposes to bring Achemos Grupe (Achema Group), one of Lithuania's largest business conglomerates, into a project to build a liquefied natural gas (LNG) import terminal in the country. The state would hold an 80 percent stake in a company that would implement the proposed project and Achema would own the remaining 20 percent of the shares, Economy Minister Vytas Navickas said on Monday. The new company would have an initial capital of LTL 100,000. "We have sent documents to the government, in which it is proposed that 80 percent [of shares] be owned by the state and 20 percent by private capital. Based on earlier decisions by the government's strategic committee, we are to establish a state-owned terminal jointly with private capital," Navickas told reporters. The ministry interviewed all gas importers but Achema was the only potential investor that agreed to participate and invest in the project, he said.
Lietuvos Zinios, Lietuvos Rytas, Verslo Zinios, Respublika
News from Ignalina Nuclear Power Plant
Lithuania's Ignalina Nuclear Power Plant (INPP) has completed the dismantling of unfinished third reactor building and remediation of contaminated soil around the unit, which has never been launched. The site of the third unit has been indicated as one of two alternative locations for new nuclear facility in the Environmental Impact Assessment (EIA) of new nuclear power plant. The dismantling of the building, land recultivation and other works cost LTL 45 million to INPP, Henrikas Lobacevskis, chief engineer of INPP Decommissioning Service, said.
Monday, 15th of September
Milk purchase price declines in Lithuania
The average natural milk purchase price declined by 1.1 percent, to LTL 784.9 per ton, in Lithuania in August versus July. Compared with August 2007, however, the average purchase price rose by 7.3 percent, the Agriculture Ministry reported. The total volume of natural milk purchased from farmers rose by 3.4 percent, year-on-year, to 930,340 tons in January-August, and declined by 1 percent, to 148,880 tons in August alone.
Sodra transferred LTL 266,64 million
The Lithuanian State Social Insurance Fund (Sodra) on Friday transferred LTL 266.64 million into the country's second-pillar pension funds, 2.8 percent more than a quarter ago. The money represents contributions by 880,000 pension scheme participants for the second quarter of this year, Sodra said. In the second pillar, employees can divert a certain portion of their compulsory social insurance contributions to private pension funds. Currently, this portion is 5.5 percent.
Hourly labour costs rise in Lithuania
Average hourly labor costs in Lithuania rose by 19 percent in the second quarter of this year compared with the same period last year, the Statistics Department reported on Wednesday. Hourly work pay in cash and in kind, as adjusted for calendar effects, increased by 19.1 percent, while other labor costs (social contributions) rose by 18.5 percent in the reporting period. The fastest growth in labor costs per hour was in real estate, rental and other business activities (up 27.1 percent), the slowest - in financial mediation sector (10.6 percent).
Back to Baltic Business Monitor