aA
Lithuania's Finance Ministry is not changing its outlook and continues to estimate that the country's economy will slow next year, although it still will exceed the EU average.
UNIQA mineralinio vandens gamyklos atidarymas
UNIQA mineralinio vandens gamyklos atidarymas
© DELFI / Rafael Achmedov

"Fast economic growth will not last forever as the international environment is worsening and international organizations are cutting their estimates. (…) Those risks will undoubtedly affect the Lithuanian economy. (…) Our economy will grow next year as growth will be supported by internal consumption but growth will slow and be more fragile. So, we all need to be cautious," Finance Minister Vilius Sapoka said when presenting the latest macroeconomic forecasts on Wednesday.

The ministry raised the GDP estimate for this year to 3.7 percent, from 2.6 percent in March, bur growth will slow in the future.

The spring GDP growth estimate of 2.4 percent was left unchanged, just as the ones for 2021 and 2022 when the growth of 2.3 percent is expected.

Experts from the ministry cited positive factors, like good migration tendencies, faster growth in direct foreign investment, strong internal and external demand and incentives from the European Central Bank.

Meanwhile, Brexit, growing signs of protectionism, monetary policy changes, geopolitical tensions and fluctuations in global financial markets were named among negative factors.

Vice Minister of Finance Migle Tuskiene said the Brexit process and growing investments were behind the significant change in the GDP estimate for this year from the spring one.

"When evaluating and updating estimates, we took into account both factual results and risks. First of all, what we had in March was that we included in the calculation the assumption that Brexit would take place in late March as we had a very clear date. (…) Factual results also affect our forecasts. Investments are growing faster," she said.

In her words, the inflation forecasts were updated only slightly.

"Over the whole estimated period, we do not expect any major changes in price growth as inflation will stand around 2 percent," the vice minister said.

Lithuania's average annual inflation rate, as measured by the EU Harmonized Index of Consumer Prices (HICP), is forecast to stand at 2.4 percent this year, up by 0.2 percentage points from the March forecast, and the 2020 forecast was increased by 0.1 percentage points to 2.3 percent.

The Finance Ministry forecasts that the change in the average monthly salary before tax will stand at 8.3 percent this year, up 0.3 percentage points from the spring estimate, and the 2020 forecast was increased by 1 percentage point to 7.4 percent.

BNS
It is prohibited to copy and republish the text of this publication without a written permission from UAB „BNS“.

Official: ban on Ukrainian poultry imports won't affect our market

The European Commission's ban on imports of Ukrainian poultry meat and poultry products will have...

Some 200 new points of sale of illegal tobacco emerged

204 new points of sale of illegal tobacco emerged in Lithuania, with their number going up by a...

Tourism: Lithuania had biggest growth of nights spent in EU

In 2019, the number of nights spent in tourist accommodation in the European Union (EU) is expected...

No contamination found in Curonian Lagoon fish

Tests have found no contamination in fish from the Curonian Lagoon despite the release of untreated...

Debates started to get a grip on environmental polluters

The of Lithuanian Seimas during its extraordinary session on Thursday started deliberating a package...

Top news

Crazy about coffee: Ukrainian is looking for best cafe in Vilnius (4)

Some people have a passion. For Ukrainian student Oleksandra Kyryliuk coffee is her number one...

Plans to commemorate Baltic Way by naming roads

Lithuania plans to commemorate the Baltic Way , which took place more than 30 years ago, by naming...

Official: ban on Ukrainian poultry imports won't affect our market

The European Commission's ban on imports of Ukrainian poultry meat and poultry products will have...

Foreign ministry advised against travel to central China due to coronavirus

The Lithuanian Foreign Ministry has advised Lithuanian citizens against traveling to China 's central...

Number of barred people up as immigration grows

The number of people barred to enter Lithuania rose last year, and the country's State Border Guard...