Observer "Lietuva"

Lithuania Business News: Archive 2003-

WEEK 26/2009

Saturday, 27th of June

Hole of LTL 2 billion
Lithuania's public sector deficit made up LTL 1.999 billion, accounting for 2 percent of this year's projected gross domestic product (GDP). Three-month revenues totalled LTL 7.7827 million, expenditures – LTL 9.6058 million, and transactions in non-financial assets - to LTL 175.8 million.
Lietuvos Rytas

Travelled less
According to the Statistics Department, Lithuanian residents spent a total of LTL 357.5 million while travelling abroad during the first quarter of this year, down 47.1 percent from the same period a year ago. Domestic tourists travelling inside Lithuania with at least one overnight stay and one-day tourists spent a total of LTL 62.3 million during the three months, down 19 percent year-on-year, based on preliminary results of a domestic and outbound tourism survey. During the first quarter this year 194,800 Lithuanian tourists went abroad, which is by 31 percent less than during the same period last year.
Lietuvos Rytas, Respublika

Will begin regular flights
Star1 Airlines, an air carrier owned by Lithuania's tour operator Star Team Group, has had its first plane flown to Vilnius. Next week the airline plans to launch regular scheduled flights. Star1 Airlines is yet to obtain permission to fly passengers. According to Martynas Laivys, the head of Star1 Airlines, the sales of direct flights tickets has started on the internet on Friday. It is planned to begin flights from Vilnius to London, Dublin and Girona (Barcelona) in July.
Respublika, Lietuvos Rytas

Friday, 26th of June

Exceeded half of average
Lithuania's per capita gross domestic product (GDP) last year amounted to 61 percent of the European Union average, data from the EU's statistics office Eurostat showed on Thursday. Latvia's GDP per capita stood at 56 percent of the EU average, Estonia's at 67 percent and Poland's at 57 percent. GDP per capita in all member states varied from 40 percent to 253 percent of the EU average.
Lietuvos Rytas, Verslo Zinios

Hopes for profit
Grigiskes, the largest manufacturer of hardboard and toilet paper in Lithuania, and its subsidiary Baltwood are projecting LTL 800,000 in pre-tax profits for the full year 2009, on revenues of LTL 112.8 million. Grigiskes' management board approved the new goals on Thursday. At the start of this year, the group aimed to achieve LTL 300,000 in pretax profits on revenue of LTL 150 million. "The forecasts for the year 2009 are being revised in view of non-audited financial results for the first quarter, sales trends and lower consumption in the Lithuanian and foreign markets," the company said in a press release. The group has posted losses of LTL 2.489 million for 2008, on revenues of LTL 145.459 million.
Verslo Zinios

Moves away already
Norway's insurance company Gjensidige Forsikring is buying Sweden's Lansforsakringar International, which operates non-life insurance operations in Latvia and Lithuania under the name Nordicia. Gjensidige Forsikring and Lansforsakringar have signed a letter of intent regarding the final negotiations for an acquisition of Lansforsakringar International's assets, the companies said in a press release on Thursday. The parties have agreed not to disclose details of the transaction. Gjensidige intends to operate the business under the Gjensidige brand name, "Gjensidige is already established in the Baltic market with a solid and profitable business and has an explicit ambition of growing further in this market.
Verslo Zinios

Thursday, 25th of June

New head of Lietuvos Energija
Shareholders of Lietuvos Energija (Lithuanian Energy), the power transmission subsidiary of the national energy company Leo LT, on Tuesday appointed a new four-strong management board Aloyzas Koryzna, a business consultant, was appointed chairman of the management board and chief executive officer of Lietuvos Energija. He replaced Darius Masionis, who had been at the helm of the company for less than a year. "We are strengthening the management of the company and building up a team capable of ensuring the continuity of operations and the reliability and development of the electricity transmission system, as well as of implementing the requirements of the EU legislation on a further liberalization of the energy market," Rimantas Vaitkus, the CEO of Leo LT, said in a press release.
Verslo Zinios

SEB advices to stop begging
Lithuania's Gross Domestic Product (GDP) should contract by 15.5 percent this year, SEB bank, the largest Lithuania's commercial bank, forecasts downgrading its previous projection of a 9 percent economic decline this year. For 2010 the bank's analysts are projecting a 3.5 percent decline, unchanged from earlier forecasts. In 2011 the economy should expand by 3 percent. Fiscal deficit should reach 7 percent of GDP this year and 5 percent in 2010. "It means that the hopes of the head of Lithuania's government to adopt the euro in 2012 are too optimistic since the authorities will not manage to reduce the fiscal deficit to the required 3 percent level until mid-2011," Gitanas Nauseda, an adviser to SEB bank president, said on Tuesday.
Verslo Zinios

Standard is 65 years
The pension age in Lithuania will be extended gradually and will reach 65 years eventually, Prime Minister Andrius Kubilius has said. The measure should be taken considering the demographic situation and following the pension age trends in the majority of the European Union (EU) Member States. "A study carried out by the World Bank and the majority of other experts recognize that the pension age in Lithuania is among the lowest across the European Union, that is why it is being proposed to raise the pension age gradually - by a couple of months once in a half a year or once a year - until it reaches that European standard, i.e. 65 years," Kubilius said in an interview to the public radio station Lietuvos Radijas (Lithuanian Radio) on Tuesday. According to him, current pension age no longer matched the demographic situation and the possibilities available in Lithuania: "Hence we have to think about and consider such solutions as well." The pension age is currently 62.5 years for men and 60 years for women.
Verslo Zinios, Respublika, Lietuvos Zinios

Wednesday, 24th of June

State Holiday.

Tuesday, 23rd of June

Another 5,700 of unemployed
Another 5,700 people were registered as unemployed in Lithuania last week, down 24 percent from 7,500 people registered a week earlier, the country's Labor Exchange said on Monday. The total number of people with the status of unemployed persons reached 196,400 as of June 19 (up from 194,900 a week earlier), which accounted for 9.2 percent of the working age population. Some 1,163 job vacancies were registered in June 12-19, down 19 percent from 1,440 vacancies a week earlier. Some 2,600 persons got employed, down 19 percent from 3,200 the previous week.
Lietuvos Rytas, Respublika, Verslo Zinios

Grew and fell
Lithuania's industrial output and sales fell by 17.4 percent in the first five months of this year compared with the same period a year ago, the Statistics Department reported on Monday. In May alone, the country's industrial output dropped by 19.3 percent in year-on-year terms, but rose by 4.2 percent compared with April. In January through May year-on-year, mining and quarrying, and manufacturing output declined by 19.1 percent. The mining and quarrying sector recorded a 36.6 percent drop in output, and the manufacturing sector fell by 18.9 percent.
Respublika, Verslo Zinios

Crisis presents new puzzles every time
Deputy Finance Minister Ingrida Simonyte will be appointed new Lithuania's Finance Minister, Prime Minister Andrius Kubilius has confirmed. Incumbent Finance Minister Algirdas Semeta, who has been confirmed as Lithuania's candidate for the post of European Commission member responsible for financial programming and budget, says the candidate is suitable for the job. "I believe that Simonyte is truly the right person to take up these duties," Kubilius told the reporters when asked whether Simonyte would be appointed the finance minister. As EU budget commissioner, Semeta would replace Dalia Grybauskaite, who was elected Lithuania's president last month and will be inaugurated on July 12.
Lietuvos Rytas, Verslo Zinios, Lietuvos Zinios

Monday, 22nd of June

A billion for business
Lithuania has reached an agreement with the European Investment Fund (EIF) on the boosting of the Business or Holding Fund to LTL 1 billion. On Friday Economy Minister Dainius Kreivys, Finance Minister Algirdas Semeta and Richard Pelly, the CEO of the EIF, signed a memorandum outlining a decision to boost the Business Fund to LTL 1 billion and agreed on the schedule of money transfers. "An agreement with the EIF is an important step towards our goal to revive the credit resources market. I hope that EIF will complete the selection of banks soon and small business will get the money," Kreivys said. The funds will be used for the financing of micro, small and mid-scale enterprises (MSME). The government opened talks with the EIF on the boosting of the fund back in February. On March 4 the authorities and the EIF signed an amendment to a trilateral financing agreement that provides for increasing the funding for micro, small and medium-sized enterprises to a billion litas, from LTL 275 million.
Lietuvos Zinios

Railways lost one third of cargos
Lithuania's national railway company Lietuvos Gelezinkeliai (Lithuanian Railways) saw its freight traffic decline by 31.5 percent in the first five months of this year, compared with the year-earlier, to 16.4 million tons. Year-on-year, international freight volumes slumped by 36.5 percent, to 11.4 million tons, and domestic freight traffic fell by 16.9 percent, to 5.1 million tons, the Statistics Department reported on Friday. Transit shipments accounted for 43.9 percent of the total international freight traffic, down by 41 percentage points compared with a year ago.
Verslo Zinios

Semetas’ candidacy was fine
Lithuanian Prime Minister Andrius Kubilius said European Commission (EC) President Jose Manuel Barroso agrees to Lithuania's proposal to appoint its Finance Minister Algirdas Semeta as Commissioner responsible for financial programming and budget. "To be honest, I didn't take part in the conversation, the two of them conversed alone. Today I exchanged a few words with Barroso, who said the candidate is suitable and all official procedures will kick off shortly" Kubilius in the late hours of Friday told members of the press after meeting with European Union (EU) leaders in Brussels. The current EC term will be up in Oct, with its President Barroso aiming for a second five-year term, with backing of EU leaders. Lithuania is represented in the EC by Dalia Grybauskaite, elected the next president of Lithuania in May's election. Her inauguration is scheduled for July 12, by which time she will have vacated the commissioner's post.
Verslo Zinios

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