Big cities and coastal resorts top entrepreneur rankings

With above-average numbers of small and medium-sized businesses, individuals engaging in business activities, and numbers of credits issued to start-up businesses, these key regions are leading the way, with the least enterprising regions lying along Lithuania’s borders.

Dalia Matukienė, chairwoman of the Lithuanian Small and Medium-Sized Business Council, said that entrepreneurship has been on the rise in Lithuania over recent years, although differences among regions remain.

“We are currently finalizing preparations before implementing entrepreneurship promotion measures from the European Union’s 2014-2020 funds. In order to bridge the divide, we must channel more of these investments towards regions with the lowest level of entrepreneurship,” Matukienė said.

The 2015 entrepreneurship map has been drawn up by the Lithuanian Central Credit Union (LCKU) with each municipality ranked according to four criteria: the number of small and medium-sized businesses per capita, the number of new businesses set up over the last year, business certificates issued to individuals, as well as the number of loans issued by the Entrepreneurship Promotion Fund.

“Seaside resorts and the biggest cities, as well as the districts around them, provide the most favourable conditions to develop and expand small businesses. There is more demand for goods and services due to higher living standards, bigger populations and greater domestic and international tourist flows. Meanwhile the lowest-ranked districts can be found in border regions and agricultural zones,” said Tomas Valauskas, credit department head at the LCKU.

Border regions among least enterprising

Standing out in Lithuania’s entrepreneurship map are Neringa and Vilnius City municipalities where entrepreneurship is 3.5 and 2.7 times above the country’s average, respectively.

The top-ten also includes Kaunas District (1.77 times the national average), Kaunas City (1.65), Vilnius District (1.57), Palanga (1.53) and Klaipėda City (1.47).

“The leadership of the three biggest cities and districts around them has to do with bigger concentration of small and medium-sized businesses, while Neringa and Palanga also benefit from high numbers of individuals engaging in economic activities,” Valauskas said.

Meanwhile at the bottom of the list are Lazdijai and Kalvarijos municipalities (where entrepreneurship level is at 0.49 of the national average), Vilkaviškis (0.51), Birštonas, Švenčionys and Visaginas (0.53 each).

“Of the 10 least enterprising municipalities, eight are located in border regions. The concentration of small and medium-sized businesses in these regions are well below the national average, fewer individuals have registered business activities with the Tax Inspectorate,” Valauskas said.

There were 76,000 small and medium-sized businesses operating in Lithuania in early 2015, according to Statistics Lithuania, or, on average, 26 firms for every 1,000 people. In Vilnius, the number was 52 per 1,000 people, in Neringa, 56.

Most new small and medium-sized businesses were set up in Lithuania’s three major cities or Baltic coastal resorts. Lithuanians established 8,000 new small and medium-sized firms in 2014, with more than half of them located in Vilnius City.

Meanwhile 158,000 people took out individual business certificates that allowed them to engage in economic activity between January and August 2015.

Kaunas City is the number-one municipality in terms of how many people made use of business loans from the Entrepreneurship Promotion Fund. In all, the fund gave out €19.4 million to individuals seeking to implement a business idea, or to new firms under one year-old.