Observer "Lietuva"

Lithuania Business News: Archive 2003-

WEEK 10/2009

Saturday, 7th of March

Energy from Russia
Russia's electricity exports and imports monopoly Inter RAO UES has confirmed it has signed a 10-year power supply agreement with Lithuania. "The deal was concluded in order to supply electricity to Lithuania after the shutdown of Ignalina Nuclear Power Plant (INPP)," Inter RAO said. Inter RAO, which is controlled by Russia's public corporation Rosatom, will supply to Lithuania 2.5 billion kWh of electricity per year via its Lithuanian subsidiary Energijos Realizacijos Centras (ERC). Commercial terms of the deal have not been disclosed.
Lietuvos Rytas

Output became cheaper
Lithuania's producer prices edged up by 0.5 percent in February from January, but were down by 9.3 percent compared with the same period a year ago, the Statistics Department reported on Friday. Excluding the impact of oil product prices, the producer price index fell by 0.4 percent on a year-on-year basis and was down by 1.5 percent month-on-month, it said. The monthly rise was mostly due to increases of 10.1 percent in prices for refined petroleum products, of 2.1 percent in furniture prices and of 2 percent in beverage prices. This was partly offset by decreases of 4.6 percent in chemical product prices, of 8.8 percent in gas prices and of 2.2 percent in food product prices.
Lietuvos Rytas, Respublika

One more Akropolis is opened in Siauliai
Aido Turtas, a company of the Akropolis Group, has invested over LTL 200 million in a new Akropolis shopping and entertainment center that opened for business in Siauliai, in northern Lithuania, on Friday. The 50,000-square-meter shopping and entertainment complex will create around 1,000 new jobs, the mall's operator said. This is the fourth Akropolis mall in Lithuania. The three operating Akropolis malls -- in Vilnius, Kaunas and Klaipeda -- attracted 40.4 million visitors last year, up 10 percent from the previous year. Their total spending increased by 15.7 percent to LTL 2.08 billion.
Respublika, Lietuvos Rytas

Friday, 6th of March

Argued about litas
The litas-euro exchange rate would most probably be adjusted if Lithuania introduced the single currency today, Kestutis Glaveckas, the chairman of the parliament's Budget and Finance Committee, said on Thursday. The Lithuanian national currency is pegged to the euro under a currency board arrangement at a fixed rate of LTL 3.4528 to one euro. "If the euro were introduced at the rate of LTL 1 euro to LTL 3.45, it would be good, but nobody will give such a rate," Glaveckas said during a news conference. The changeover rate will be set by the European Central Bank (ECB). "It could set the rate at LTL 3.7 or LTL 3.8 [per euro]," the lawmaker said. Glaveckas said that people would lose money even if there were a 10 percent devaluation of the litas during the changeover to the euro. Therefore, there should be no adjustments to the exchange rate, he said. The lawmaker thinks that Lithuania's national currency is overvalued against some currencies.
Lietuvos Zinios, Verslo Zinios, Lietuvos Rytas

Patch for the hole in the budget
Lithuania's budget was LTL 389 million or 16 percent short of revenue target in January-February, while the revenues of the social insurance fund (Sodra) were LTL 72 million below the planned amount. Meanwhile, the revenues of local authorities' budgets were as planned. The revenues on value-added tax were 16 percent or LTL 226 million below the target, and the revenues on excise duties missed the target by 8 percent or LTL 49 million. The revenues on income tax, meanwhile, exceeded the planned amount by LTL 8.5 million or 5.2 percent in January-February.
Lietuvos Zinios, Lietuvos Rytas

Will attract with cut-down prices
Vilnius International Airport, the largest in Lithuania, has slashed the average passenger fee almost by half and is currently in intensive talks with both existing and potential customers. Starting early February, it costs an airline around EUR 11 to fly one passenger via the Lithuanian capital, down from around EUR 19-20 previously, Vilnius Airport CEO Tomas Vaisvila said at a news conference on Thursday. "In this respect, Vilniaus Airport has become competitive vis-a-vis Riga and Tallinn," he said. Vaisvila said that he would meet with the heads of some foreign airlines in the coming week. The airport's CEO said that the key message he wanted to deliver to partners was that Vilnius Airport was undergoing major changes. "Price is not the first question they would ask me. The question is: what is going to change at your company,'" he said.
Respublika, Verslo Zinios, Lietuvos Rytas

Thursday, 5th of March

One billion litas is approved already
Lithuania's government has increased the financing for micro, small and middle-sized companies to LTL 1 billion, from LTL 275 million. Economy Minister Dainius Kreivys, Finance Minister Algirdas Semeta and Richard Pelly, CEO of the European Investment Fund (EIF), signed a respective amendment to a trilateral financing agreement in Vilnius on Wednesday. Loans will be provided via commercial banks, which will be selected by April 30. A respective tender should be announced on March 5. The government has virtually completed negotiations to borrow up to EUR 1.132 billion from the European Investment Bank (EIB) on favorable terms. The money will be used for co-funding of 2004-2013 projects supported by the European Union.
Verslo Zinios, Lietuvos Zinios, Lietuvos Rytas

Unemployment grew
Lithuania's unemployment rate increased by 1.2 percentage points over February, to reach 8.2 percent as of Mar. 1, the Labor Exchange reported on Wednesday. The jobless rate made up 7 percent a month earlier, i.e. on February 1. The number of registered job-seekers reached 176,400 as of early March, of whom 152,400 had the status of unemployed persons.
Lietuvos Rytas

Leo LT is the target
Lithuanian Prime Minister Andrius Kubilius on Wednesday did not rule out that asset distribution or ownership stakes in the national energy company Leo LT could be reviewed. "We do not rule any possibilities. We are not satisfied with Leo's [first] year of operations. We will see what consequences this may entail after the government forms its opinion," Kubilius told reporters after meeting his ruling coalition partners. The prime minister said that the government would also look into other problems highlighted by the Constitutional Court, including the valuation of assets in the three energy companies that were merged into Leo LT, and the planned spin-off of the Kruonis Hydro Pump Storage Plant and the Kaunas Hydro Power Plant into separate companies. "But that requires a somewhat longer period of time," he said.
Lietuvos Rytas, Lietuvos Zinios

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