Russian embargo impact on Lithuanian economy minimal, Swedbank says

Swedbank
DELFI / Kiril Čachovskij

Losses in Eastern markets were rather promptly compensated, at least partially, thanks to quickly growing exports to other countries. Exports of Lithuanian goods, except for mineral products, this year have increased by 37 percent to the USA, 58 percent to Spain, 8 percent to Sweden. This year, Lithuanian processors have sold 8 times more dairy products to the USA than a year ago.

Russia is the biggest export market for Lithuania’s services as last year one fifth of all services from Lithuania were exported to Russia in 2014. However, it seems that service exporters too have managed to find new clients besides Russia.

As anticipated, the usually high number of incoming tourists from Russia and Belarus decreased sharply as a result of weaker currencies of these two countries. In the first half of this year, compared to the same period in 2014, the number of accommodated tourists from Russia went down by 37 percent, from Belarus – 14 percent. However, the tourism sector of Lithuania did not see a tragedy, in fact, total number of foreign tourists even grew slightly as more tourists came from Latvia, Poland, UK, Estonia, and Ukraine.

Both service sector and industry have proven that the loss of the Russian market is far from disastrous to Lithuania’s economy.

Swedbank forecasts that the value of Lithuania’s good and service exports will grow by 9 percent in 2016.

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