“In the next four years, Lithuania’s growth will surpass eurozone average several times. Other Baltic states will show similar tendencies. Hence even though our region accounts only for 0.8 percent of the total eurozone GDP, it will spearhead the growth,” said Jonas Akelis, EY Managing Partner in the Baltic states.
However, inflation is expected to increase slightly. EY analysts forecast that in 2015 inflation rate will reach 1.4 percent, while in 2016-2018 inflation is not expected to exceed 2 percent.
Tom Rogers, economist of Oxford Economics, says that Lithuania’s growth prospects are among the best in the single currency market as growing export will lead to private investment increase, which in turn will be encouraged by loosening monetary policy in the region. According to the economist, Lithuania should remain the fastest growing economy at least until 2018.
Moreover, unemployment should decrease much faster in Lithuania compared to the euro area. By 2018 it should decrease by 4 percentage points, from 11.4 to 7.5 percent.
In September, the Bank of Lithuania predicted 3.3 percent economic growth rate, but revised projections to 3.1 percent. SEB bank says that in 2015 Lithuania’s economy will grow just 2.6 percent, whereas the International Monetary Fund predicts 3 percent GDP growth rate.