Economy of Lithuania [1]
Currency	Litas (LTL)
Fiscal year	1 January — 31 December
Trade organisations	EU, WTO and OSCE
Statistics
GDP	$60.38 billion (2010)[2]
GDP growth	5,9% (2011)[3]
GDP per capita	$18.193 (2010)
GDP by sector	agriculture (4.37%), industry (21.46%), services (74.18%) (2008)
Inflation (CPI)	3.4% (July 2011)[4]
Population below poverty line	4% (2003)
Labour force	1.65 million (IIIQ 2009)
Labour force by occupation	services (72.49%), industry (19.58%), agriculture (7.94%) (2008)
Unemployment	13.8 % (April 2012)[5]
Average gross salary	2121 LTL / 858 $, monthly (2010)[6]
Average net salary	1650 LTL / 668 $, monthly (2010)[6]
Main industries	ICT, Biotech, Metal Processing, Machinery and Electric Equipment, Plastics, Furniture, Wood processing & Paper Industry, Textile & Clothing, Food, Real Estate & Construction, Transport & Logistics, Lasers
Ease of Doing Business Rank	27th[7]
External
Exports	€11.8 billion (2009), €15.6 billion (2010), €20.2 billion (2011)
Export goods	mineral products (21.5%), machinery and mechanical appliances, electrical equipment (10.6%), products of the chemical or allied industries (9.1%) (2009)
Main export partners	EU (60.9%), Russia (15.6%), Germany (9.8%), Latvia (9.3%), Poland (7.7%) (2010)
Imports	€13.1 billion (2009), €17.6 billion (2010), €22.6 billion (2011)
Import goods	mineral products (29.3%), machinery and mechanical appliances, electrical equipment (13.1%), products of the chemical or allied industries (12.3%) (2009)
Main import partners	EU (56.5%), Russia (32.6%), Germany (10.5%), Poland (8.8%) and Latvia (6.3%) (2010)
FDI stock	Eur 10,762 billion (2011) [8]
Gross external debt	Eur 7.134 billion (2009) (26,6 % of GDP)
Public finances
Revenues	Eur 9.815 billion (2011)
Expenses	Eur 11.502 billion (2011)
Economic aid	EU structural assistance: 2.286 Eur billion (2010 est.), assistance from Switzerland: 9.09 Eur Mln. (2010)
Credit rating	Standard & Poor's:[9] BBB (Domestic) BBB (Foreign) A (T&C Assessment) Outlook: Stable[10] Moody's:[10] Baa1 Outlook: Stable Fitch:[10] BBB Outlook: Positive
Foreign reserves	US$7.851 billion (April 2011)[11]
All values, unless otherwise stated, are in US dollars

Lithuania is a member of the European Union and the biggest economy among three Baltic states. GDP per capita reached USD 17,800 in 2008 and was higher than the ones of all its neighbors – Latvia, Poland, Russia and Belarus.^[12]

GDP per capita in Lithuania is 70% above the world's average of US$10,500.^[12] Lithuania has a favorable legislative basis for business as the country is ranked the 3rd in the region of Eastern Europe and Central Asia^[13] and the 26th in the world by the Ease of Doing Business Index prepared by the World Bank Group.^[14] Lithuania is ranked the 30th out of 179 countries in the Index of Economic Freedom, measured by The Heritage Foundation.^[15] According to the Human Development Report 2011, Lithuania belongs to the group of very high human development countries.

Having moved away from central planning system in the late 1980s, in 1990, Lithuania was the first to break away from the Soviet Union and become an independent capitalist economy. Lithuania soon implemented liberal reforms and became one of the fastest growing countries in the world last decade, as GDP growth rate was positive 9 years in a row till 2009. It enjoyed high growth rates after entering the European Union along with other Baltic states, leading to the notion of a Baltic Tiger. Current excellent telecommunication infrastructure and well-educated, multilingual workforce give the possibility to provide high quality business services and produce manufacturing products worldwide.

In 2005 the GDP grew by 7.5% and the inflation rate was 3%. GDP growth reached its height in 2007, increasing by 8.9%.^[16] Lithuania was the last among the Baltic states to be hit by the economic crisis because its GDP growth rate in 2008 was still positive. In the third quarter of 2009, compared to the previous quarter, GDP grew again by 6.9% after 5 quarters with negative numbers.^[17] Rebound in Lithuania's economy in the third quarter was the fastest in the EU.^[18] In the last quarter of 2009 Lithuanian economy rose moderately by 0.1%,^[19] however the Finance Ministry of Lithuania forecasts that Lithuania's economy will keep growing by 1.6 % in 2010 and by 3.2 % in 2011.^[20]

History of economy[link]

The history of Lithuania can be divided into 7 major periods. All the periods have some interesting and important facts that had an impact on the economic situation of the country in those times.

• Ancient times – Baltic tribes (until the 13th century)
• Grand Duchy of Lithuania (13th century -1569)
• Polish-Lithuanian Commonwealth (1569–1795)
• Pressure of the Russian Empire (1795–1914)
• Independent Lithuania during the interwar period (1918–1940)
• Lithuanian Soviet Socialist Republic (1944–1990)
• Republic of Lithuania (since 1990)

History up to the 20th century[link]

The first Lithuanians were a branch of an ancient ethnic group known as the Balts. The tribes maintained close trade contacts with the Roman Empire. Amber was the main good provided to the Roman Empire from Baltic Sea coast, by a long route called the Amber Road.

Consolidation of the Lithuanian lands began in the late 12th century. Mindaugas, the first Lithuanian ruler, was crowned as Catholic King of Lithuania in 1253. The expansion of the Grand Duchy of Lithuania reached its height in the middle of the 14th century under the Grand Duke Gediminas, who created a strong central government which later spread from the Black Sea to the Baltic Sea. The duchy was open to everyone. Grand Duke Gediminas issued letters to the Hanseatic league, offering free access to his domains to men of every order and profession from nobles and knights to tillers of the soil. Economic immigrants had a positive impact, improving the level of handicrafts.

In 1569, the Polish–Lithuanian Commonwealth was formed by the union of the Kingdom of Poland and the Grand Duchy of Lithuania. The economy of the Commonwealth was dominated by feudal agriculture based on the exploitation of the agricultural workforce (serfs). Poland-Lithuania played a significant role in the supply of 16th century Western Europe by exporting three sorts of goods, notably grain (rye), cattle (oxen) and fur. These three articles amounted to nearly 90% of the country's exports to western markets by overland and maritime trade.

The Commonwealth was famous for Europe's first and the world's second modern codified national constitution, the so-called Constitution of May 3, declared on the 3rd of May, 1791, after the 1788 ratification of the United States Constitution. Economic and commercial reforms, previously shunned as unimportant by the Szlachta, were introduced, and the development of industries was encouraged.

Following the partitions of the Polish-Lithuanian Commonwealth in 1772, 1793 and 1795, the Russian Empire controlled the majority of Lithuania. One of the most important reforms during the pressure of the Russian Empire that affected economic relations was the Emancipation Reform of 1861 in Russia. The reform amounted to the liquidation of serf dependence previously suffered by peasants and boosted the development of capitalism.

Lithuania in the 20th century[link]

On February 16, 1918, the Council of Lithuania passed a resolution for the re-establishment of the Independent State of Lithuania.^[21] Soon, many economic reforms for sustainable economic growth were implemented. A national currency, called the Lithuanian litas, was introduced in 1922. It proved to become one of the most stable currencies in Europe during the inter-war period.^[21] During the time of its independence, 1918–1940, Lithuania made substantial progress. For example, Lithuania was the second in the world in exporting flax; Lithuanian farm products such as meat, dairy products, many kinds of grain, potatoes, etc. were of superior quality in the world market.^[21]

Having taken advantage of favorable international developments, and driven by its foreign policy aims directed against Lithuanian statehood, the Union of Soviet Socialist Republics (USSR) occupied Lithuania in 1940.^[22] Land and the most important objects for the economy were nationalized, and most of the farms collectivized.^[21] Later, many inefficient factories and industry companies, highly dependent on other regions of USSR, were established in Lithuania. Despite that, in 1990, GDP per capita of the Lithuanian Soviet Socialist Republic was USD 8,591, which was above the average for the rest of the Soviet Union of USD 6,871 but lagging behind developed western countries.

The Soviet era brought Lithuania intensive industrialization and economic integration into the USSR, although the level of technology and state concern for environmental, health, and labor issues lagged far behind Western standards.^[16] Urbanization increased from 39% in 1959 to 68% in 1989. From 1949–1952 the Soviets abolished private ownership in agriculture, establishing collective and state farms. Production declined and did not reach pre-war levels until the early 1960s. The intensification of agricultural production through intense chemical use and mechanization eventually doubled production but created additional ecological problems. This changed after independence, when farm production dropped due to difficulties in restructuring the agricultural sector.^[16]

The myth of Lithuania's economic collapse[link]

According to official statistics, towards the end of central planning economic output plunged in all Soviet-type countries during the transition from central planning to a market economy. The total registered declines in GDP range from 13 to 77% in Eastern Europe.^[23] However, both Soviet period and early transition period statistics were deeply flawed and do not represent the real situation and processes in Eastern Europe and Lithuania.^{[citation needed]}

During the transitional period former USSR republics, including Lithuania, were characterized by these aspects: overproduction reporting; reluctance to pay taxes by people and enterprises; the reduction of value detraction; overestimation of investment ratios; and politically determined trade among the Soviet countries.^{[citation needed]}

Taking into account the shadow economy, value detraction from products and services, doubtful investments and indirect trade subsidies, Lithuania was not faced with such a huge contraction in GDP as was usually thought and represented in official statistics. On the contrary, Lithuania made structural reforms for future growth and welfare.^{[citation needed]}

Development since the 1990s[link]

Panorama of Vilnius downtown

Reforms since the mid-1990s have given Lithuania an open and rapidly growing economy. Open to global trade and investment, Lithuania now enjoys high degrees of business, fiscal and financial freedom. Regulation is relatively transparent and efficient. Foreign capital and domestic capital are subject to the same rules as Lithuania is a member of the EU and the WTO. The financial sector is advanced, regionally integrated, and subject to few intrusive regulations.^[15]

One of the most important reforms since Lithuania regained its independence was the privatization of state owned assets. The first stage of privatization was being implemented in 1991–1995. Citizens were given investment vouchers worth LTL 10.5 billion (USD 2.63 billion) in nominal value, which let them participate in assets selling.^[24] By October 1995, they were used as follows: 65% for acquisition of shares; 19% for residential dwellings; 5% for agricultural properties; and 7% remained unused.^[24] More than 5700 enterprises with LTL 7 billion (USD 1.75 billion) worth of state capital in book value were sold using four initial privatization methods: share offerings; auctions; best business plans competitions; and hard currency sales.^[24]

The second privatization step began in 1995 by approving a new law that ensured greater diversity of privatization methods and that enabled participation in the selling process without vouchers. During the period 1996–1998, 526 entities were sold for more than LTL 2.3 billion (USD 0.58 billion).^[24] Before the reforms, the public sector totally dominated the economy, whereas the current share of the private sector in GDP increased to over 80%.^[25]

The implementation of the monetary reform was one of the key success factors for the stability of the economy. Lithuania has chosen a currency board system formed and controlled by the Bank of Lithuania that is independent from any government institution. On 25 June 1993, the Lithuanian litas was introduced as a free convertible currency, but on 1 April 1994 it was pegged to the United States dollar at a rate of 4 to 1. The mechanism of the currency board system enabled Lithuania to stabilize inflation rates to single digits. The litas soon became a reliable currency as the litas is fully backed by foreign currency. The stable currency rate helped to establish foreign economic relations, therefore leading to a constant growth of foreign trade.^[26]

By 1998, the economy had survived the early years of uncertainty and several setbacks, including a banking crisis, and seemed poised for solid growth.^[16] However, the collapse of the Russian ruble in August 1998 shocked the economy into negative growth and forced the reorientation of trade from Russia towards the West.^[16]

Share of Private Sector in GDP

Lithuania was invited to the Helsinki EU summit^[27] in December 1999 to begin EU accession talks in early 2000.

After the Russian monetary crisis, the focus of Lithuania's export markets shifted from East to West. In 1997, exports to the Soviet Union's successor entity (the Commonwealth of Independent States) made up 45% of total Lithuanian exports. This share of exports dropped to 21% of the total in 2006, while exports to EU members increased to 63% of the total.^[16]

Exports to the United States made up 4.3% of all Lithuania's exports in 2006, and imports from the United States comprised 2% of total imports. Foreign direct investment (FDI) in 2005 was 2.6 billion litas, which represented an increase of only 4.6% compared to the same period in the previous year.

Since February 2, 2002 the litas has been pegged to the euro at a rate of 3.4528 to 1. The rate is not expected to change until Lithuania becomes a member of the Eurozone. Lithuania was very close to introducing the euro in 2007, but unfortunately the inflation level was somewhat above the Maastricht requirements.^[28] The current tough economic situation precludes compliance with the Maastricht criteria on budget balance, so Lithuania cannot expect to have the euro before 2013–2015.^[29]

The Vilnius Stock Exchange (VSE), now renamed the NASDAQ OMX Vilnius, started its activity in 1993 and was the first stock exchange in the Baltic states. In 2003, the VSE was acquired by OMX. Since February 27, 2008 the Vilnius Stock Exchange has been a member of NASDAQ OMX Group, which is the world's largest exchange company across six continents, with over 3800 listed companies.^[30] The market cap of Vilnius Stock Exchange was LTL 11.7 billion (EUR 3.4 billion) on November 27, 2009 and was twice as large as the ones of Riga and Tallinn Stock Exchanges.^[31]

During the last decade (1998–2008) the structure of Lithuania's economy has changed significantly. The biggest changes were recorded in the agricultural sector as the share of total employment decreased from 19.2% in 1998 to just 7.9% in 2008. The service sector plays an increasingly important role in the economy of Lithuania. The share of GDP in financial intermediation and real estate sectors was 17% in 2008 compared to 11% in 1998. The share of total employment in the financial sector in 2008 has doubled compared with 1998.^[32][33]

Lithuania in the 21st century[link]

Real GDP Growth in Lithuania, 1996–2008

Economic sentiment indicator and its components

Balance of Payments in Lithuania, Quarterly Data

The economy of Lithuania was one of the fastest growing in the world last decade (1998–2008) as GDP growth rate was positive 9 years in a row. Since the year 2000 GDP has almost doubled with a growth rate of 77%.^[34]

One of the most important factors for substantial economic expansion was the accession to the WTO in 2001 and the EU in 2004, which enabled free movement of the labour force, capital and trade between the Member States. On the other hand, rapid economic expansion has caused some imbalances in inflation and balance of payments. The current account deficit to GDP ratio in 2006–2008 was in double digits and reached its peak at threatening 18.8% in the first quarter of 2008.^[35] This was mostly influenced by rapid loan portfolio growth as Scandinavian banks provided cheap credits in Lithuania.^[36] The loans directly related to acquisition and development of real estate constituted around half of outstanding bank loans to the private sector.^[36] Consumption was affected by credit expansion as well. This led to high inflation of goods and services, as well as trade deficit.

The global credit crunch which started in 2008 affected the real estate and retail sectors. The construction sector shrank by 46.8% during the first 3 quarters of 2009 and the slump in retail trade was almost 30%.^[17][37] GDP plunged by 15.7% in the first nine months of 2009.^[17]

Lithuania was the last among the Baltic states to be hit by the economic crisis because its GDP growth rate in 2008 was still positive. In the third quarter of 2009, compared to the previous quarter, GDP again grew by 6.1% after five quarters with negative numbers.^[17] The rebound in Lithuania's economy in the third quarter was the fastest in the EU.^[18]

A heavy shock to consumers helped to balance the current account in 2009.^[35] Net external assets of the Bank of Lithuania are at a record height of EUR 5.46 billion.^[38] Inflation in Lithuania is no longer a problem. Economic sentiment and confidence of all business activities have rebounded from a record low at the beginning of the year 2009 and suggest further improvements in the economy.

Sectors related to domestic consumption and real estate are still suffering from the economic crisis. However, exporters have started making profits even with lower levels of revenue. The catalysts of growing profit margins are lower raw material prices and staff expense.

Tax system[link]

Lithuania has a favorable tax system. There are four main types of taxes: personal income tax (15% + 6% health insurance contribution); value added tax (21%); corporate profit tax (15%); and social security tax on employers (31% + employee's contribution of 3%).^[39] 5% corporate tax for small business was introduced on 1 January 2010. Additional taxes are tax on dividends (0-15% - dividends paid or received are not taxed when an investor controls at least 10% of voting shares in the enterprise for the period of at least 12 months), real estate tax (0.3–1.0%) and a land tax of 1.5% on businesses.^[39] The overall tax burden in Lithuania is one of the smallest among all EU countries.

Lithuania attracts foreign investors not only because of small tax burden but also because of a skilled workforce, a well-developed infrastructure and a bigger domestic market than the other two Baltic states combined. Cumulative foreign direct investment (FDI) at the beginning of the year 2009 was LTL 31.6 billion (EUR 9.2 billion).^[40] The manufacturing sector constituted 28% of total FDI, real estate and business activity sector received 20% of total FDI, and financial intermediation a little bit less – 19%.^[41] 4/5 of FDI came from the EU countries. Top countries-investors are Sweden (17% of total FDI), Germany (10%) and Denmark (9%).^[42]

Tax Burden in EU, 2008

Lithuania has an ambitious plan to become a Northern European innovation centre by 2020. To reach this goal, it is putting its efforts into attracting FDI to added-value sectors, especially IT services, software development, and consulting services, as well as finance or logistics.^[43] Well-known international companies, such as Microsoft, IBM, Transcom, Barclays, Siemens, SEB, TeliaSonera, Paroc, Philip Morris and others, have already established a presence in Lithuania.

Lithuania has prepared an attractive environment for business start-ups in two free economic zones (FEZ) in Kaunas and Klaipėda. FEZs offer not only developed infrastructure for investments and service support but also tax incentives: a FEZ is free from the corporate tax for the first six years, as well as free from tax on dividends and real estate tax.^[44] There are nine industrial sites in Lithuania, which can also provide additional advantages by having a well-developed infrastructure, offering consultancy service and some tax incentives.^[45]

The transport infrastructure inherited from the Soviet period is adequate and has been generally well maintained since independence.^[16] Its single port in Klaipėda is ice-free and supplies ferry services to German, Swedish, and Danish ports. There are a few commercial airports; scheduled international services use the facilities at Vilnius, Kaunas, and Klaipėda. The road system is well developed, including the Via Baltica highway passing through Kaunas.^[16]

Border facilities at checkpoints with Poland were significantly improved with the help of EU funds, but long waits had been a frequent phenomenon until 21 December 2007 when the Schengen Agreement came in force in both countries. Telecommunications have improved greatly since independence as a result of heavy investment. There are currently three large companies providing mobile phone services. [2] [3] [4].

Workforce[link]

Population with higher education, 2001–2008

Salaries and unemployment, 2001–2009

The number of the population aged 15 years and over is 2.85 million, and 1.52 million of them were employed in 2008.^[46] The population with higher education was 0.54 million, or more than 35% of employed people.^[46] This ratio demonstrates that workforce in Lithuania is one of the best-educated in Central and Eastern Europe (CEE) and is twice the EU-15 average. About 90% of Lithuanians speak at least one foreign language; every second person speaks two foreign languages and every third person speaks English [32].

Lithuania takes the first position in the EU by the number of students in the country. Compared to the EU's average of 15%, only 7% of 18–24 year-old people in Lithuania are not occupied with studies, the lowest percentage in the EU, announced the European Commission in the end of 2009.^[47] School-leavers can choose from 22 universities or 28 colleges for further studies, so 74% of pupils graduated from an upper secondary school continue studies in schools of higher education.^[48] Every year more than 30 thousand students graduate from universities or colleges, so the population with higher education is gradually increasing. The most popular higher education programs are business and administration, education science, law, and social sciences.

During the last decade (1998–2008) salaries have more than doubled in Lithuania. Despite this, labour costs in Lithuania are among the lowest in the EU. Average monthly net salary in the third quarter of 2009 was LTL 1665 (EUR 482) and decreased by 6% compared to the same quarter in 2008.^[49] The sharpest annual decrease in hourly labour costs in the EU of -10.9% was observed in Lithuania in the third quarter of 2009.^[50]

The unemployment rate in Lithuania is very volatile. Since the year 2001, the unemployment rate has decreased from almost 20% to less than 4% in 2007. This could be explained by two main reasons. Firstly, during the time of rapid economic expansion, numerous work places were established. This caused a decrease in the unemployment rate and a rise in staff expenses. Secondly, emigration has also reduced unemployment problems since accession to the EU. However, the current economic crisis has lowered the need for workers, so the unemployment rate increased to 13.8% and then stabilized in the third quarter of 2009.

Sectors of economy[link]

High value added production[link]

Gross value added per hour worked in 2008, LTL

High value added production is increasing in Lithuania. Several companies produce pharmaceutical substances, components for molecular diagnostics and other sophisticated biotech products. 80% of the production is exported to more than 70 countries.^[51] Lithuanian pharmaceutical companies are expanding to foreign markets by acquiring companies in Slovakia and Poland.

Lithuania has over 50% of the world's market for high-energy picosecond lasers, and is a leader in global production of ultra-fast parametric light generators.^[52] Lithuanian laser companies were among the first ones in the world to transfer fundamental research into manufacture. Lithuania's laser producers export laser technologies and devices to nearly 100 countries, including EU members, the USA, Japan, Israel, and Switzerland, mostly for universities and corporate laboratories for scientific research purposes.

Recent global broadband Internet studies show that Lithuania has the fastest Internet in the world, as well as is one of the leading countries in terms of Internet service quality. The broadband speed analysis tool that allows anyone to test their Internet connection Speedtest.net places Lithuania as No. 1 on the list of the world's top countries by upload speed. Lithuania is also on the list of the world's top countries of download speed.^[53] Lithuania has one of the highest mobile telephone penetration rates, as well. With a subscription rate of 149 per 100 population, Lithuania is ranked the 8th in the world.^[54]

An excellent telecommunication infrastructure and a well-educated, multilingual workforce enable Lithuania to provide high quality business services worldwide. Business services vary from financial to accounting and reporting services. The share of value added in this sector reaches 13%.^[43]

Service sector[link]

The service sector accounts for the largest share of GDP. One of the most important sub-sectors is information and communication technologies. 37 thousand employees work for more than 2000 ICT companies. ICT received 9.5% of total FDI.^[53] 11 out of 20 biggest IT companies from Baltic countries are based in Lithuania.^[53] Lithuania exported 31% of its IT services in the first quarter of 2009.^[55]

Development of shared services and outsourcing of business processes (BPO) is one of the most promising fields in Lithuania. The research company Datamonitor forecasts a 60% personnel growth by 2009.^[56] International companies successfully outsourcing business operations in Lithuania are Barclays Bank PLC, CITCO Group, MIRROR, PricewaterhouseCoopers, Anthill, Ernst&Young and etc.

Manufacturing[link]

Manufacturing constitutes the biggest part of gross value added in Lithuania. More than 57 thousand people were employed in food processing in 2008. The food processing sector constitutes 11% of total exports.^[51] Dairy products, especially cheese, are well known in neighbouring countries. Another important manufacturing activity is chemical products. 80% of production is exported so chemical products constitute 12.5% of total exports.^[51]

Furniture production activity employs more than 50 thousand people. This sector has grown in double-digit numbers over the last three years. The biggest companies in this field work in cooperation with IKEA and provide high quality products at competitive prices. IKEA also owns one of the biggest wood processing companies in Lithuania.^[43]

Companies in the automotive and engineering sector are relatively small but offer flexible services for small and non-standard orders at competitive prices. The sector employs about 3% of the working population and receives 5.6% of FDI.^[43] Vilnius Gediminas Technical University, the biggest technical university in Baltic countries, prepares experts for the sector.

Financial sector[link]

Lending and saving data

The financial sector concentrates mostly on the domestic market. There are nine commercial banks holding a license from the Bank of Lithuania and eight foreign bank branches.^[57] Most of the banks belong to international corporations, mainly Scandinavian. The financial sector has demonstrated incredible growth in the last decade (1998–2008). Bank assets were only LTL 11.2 billion (USD 2.8 billion) or 25.5% from GDP at the beginning of the year 2000.^[58] Half of the bank assets consisted of loan portfolio.^[58]

By the beginning of the year 2009, bank assets grew to LTL 89.7 billion (EUR 26 billion) or 80.8% to GDP, the loan portfolio reached LTL 71.4 billion (EUR 20.7 billion).^[59] The loan to GDP ratio was 64%. The growth of deposits was not as fast as that of loans. At the end of 2008, the loan portfolio was almost twice as big as that of deposits. It demonstrated high dependence on external financing. Contraction in the loan portfolio has been recorded over the past year, so the loans to deposits ratio are slowly getting back to healthy levels.

Utilities sector[link]

Heating energy data

The utilities sector accounts for more than 3% of gross value added in Lithuania. Electricity production exceeded 12 billion kWh in 2007, and consumption exceeded 9.6 billion kWh [49]. Electricity production surplus is exported.

Lithuania had a working nuclear power plant in Visaginas, which had a 72% share in electricity generation.^[60] However, the government undertook a commitment to decommission the nuclear power plant by the end of 2009, and the plant was shut on 31 December 2009. The supply of heating energy has been modernized during the last decade (1998–2008). Technological loss in the heat energy system has decreased significantly from 26.2% in the year 2000 to 16.7% in 2008. The amount of air pollution was reduced by one third. The share of renewable energy resources in the total fuel balance for heat production increased to almost 20%.

Tourism[link]

The tourism sector is becoming increasingly important for the economy of Lithuania. It constituted almost 3% of GDP in 2008.^[61] Having an untouched ecological countryside with rich natural resources (22 000 rivers and rivulets, and about 3000 lakes), a well-developed rural tourism network, a unique coastal area of almost 100 km and four UNESCO World Heritage sites, Lithuania receives more than 2.2 million foreign tourists a year.^[62] The biggest tourist flows arrive from neighbouring countries: Poland; Russia; Latvia; and Belarus. Other important countries for Lithuania's tourism are Germany, the United Kingdom, Finland and Italy.

Agriculture[link]

Despite a decreased share in GDP, the agricultural sector is still important for Lithuania as it employs almost 8% of the work force and supplies materials for the food processing sector. 44.8% of the land is arable.^[63] Total crop area was 1.8 million hectares in 2008.^[64] Cereals, wheat and triticale are the most popular production of farms. The number of livestock and poultry has decreased twofold compared to the 1990s.^[65] The number of cattle in Lithuania at the beginning of the year 2009 was 770 thousand, the number of dairy cows was 395 thousand, and the number of poultry was 9.1 million.^[65] Lithuanians have changed their habits of foodstuff consumption somewhat. During the period 1992–2008, consumption of vegetables increased by 30% to 86 kg per capita, and consumption of meat and its products increased by 23% during the same period to 81 kg per capita.^[66] On the other hand, consumption of milk and dairy products has decreased to 268 kg per capita by 21%, and the consumption of bread and grain products decreased to 114 kg per capita by 19% as well.^[66]

Regional situation[link]

GDP per capita vs. national average, %

Lithuania is divided into 10 counties. There are five cities with a population over 100 thousand and twelve cities of over 30 thousand people.^[68] The gross regional product is concentrated in the three largest counties – Vilnius, Kaunas and Klaipėda. These three counties account for 70% of the gross domestic product while having just 59% of the population.^[69] Service centers and industry are concentrated there. In five counties (those of Alytus, Marijampole, Panevėžys, Šiauliai and Tauragė), GDP per capita is still below 80% of the national average.^[69]

In order to achieve balanced regional distribution of GDP, nine public industrial parks (Akmene Industrial Park, Alytus Industrial Park, Kedainiai Industrial Park, Marijampole Industrial Park, Pagegiai Industrial Park, Panevzys Industrial Park, Radviliskis Industrial Park, Ramygala Industrial Park and Šiauliai Industrial Park) and three private industrial parks (Tauragė Private Industrial Park, Sitkunai Private Industrial Park, Ramučiai Private Logistic and Industrial Park) were established to provide some tax incentives and prepared physical infrastructure.^[45]

While the growth in the 1990s was largely constrained to the cities of Vilnius and Klaipėda, in the 2000s the situation changed. Babilonas real estate development, the largest in the Baltic States by land area, was conceived in the fifth-largest city Panevėžys in 2004. In years 2006 - 2008 the large-scale development also reached cities of Kaunas and Šiauliai and some smaller towns.

Infrastructure[link]

Volume of goods transported, million tonne-kilometers

Funding of roads

The transport, storage and communication sector has increased its importance to the economy of Lithuania. In 2008, it accounted for 12.1% of GDP compared to 9.1% in 1996.^[67] Lithuania became a well-developed transport corridor between the East and the West. Having a high-quality and dense road network, Lithuania has achieved significant growth in the amount of goods carried both by road and by rail transport. The volume of goods transported by road transport has increased fivefold since 1996. The total length of roadways is more than 80 thousand km, and 90% of them are paved.^[63] The government is demonstrating high attention to the quality of road infrastructure by increasing their funding. The funding of roads exceeded LTL 1.75 billion (EUR 0.5 billion) in 2008.

Railways[link]

Railway transport in Lithuania provides long-distance passenger and cargo services. Railways carry approximately 50 million tons of cargo and 7 million passengers a year.^[70] Direct rail routes link Lithuania with Russia, Belarus, Latvia, Poland, and Germany. Also, the main transit route between Russia and Russia's Kaliningrad Region passes through Lithuania. JSC Lithuanian Railways transports about 44% of the freight carried through the territory of Lithuania.^[71] This is a very high indicator compared to other countries of the European Union, where freight transportation by rail amounts to only 10% of the total.^[72]

Sea port[link]

Passenger traffic by maritime transport

The northern-most and one of the few ice-free seaports on the eastern shore of the Baltic Sea is located in the western part of Lithuania. The Port of Klaipėda is a regional transport hub connecting the sea, land and railway routes from east and west. Compared to neighbouring Eastern Baltic seaports, the Port of Klaipėda has the widest shipping line network with other seaports.^[70] The Port of Klaipėda handles roughly 7,000 ships and 30 million tons of cargo every year, and accepts large-tonnage vessels: dry-cargo vessels up to 70,000 DWT, tankers up to 100,000 DWT and cruise ships up to 270 meters of length. The ice-free seaport of Klaipėda is able to receive Panamax-type vessels.^[70] One of the fastest growing segments of sea transport is passenger traffic. Passenger traffic has increased fourfold since 2002.

Warehousing[link]

There are more than 600,000 m² of modern logistics and warehousing facilities in Lithuania.^[73] The biggest supply of new, modern warehousing facilities is in the capital city Vilnius (after the completion of several new projects in the third quarter of 2009, the supply of modern warehousing premises has increased by nearly 12% in Vilnius and currently reaches 334,400 m² of the rentable area). Kaunas is in the second place (around 200,000 m²), and Klaipėda in the third (122,500 m²).^[70] Since the beginning of the year 2009, prices for warehousing premises have dropped by 20–25% in Vilnius, Kaunas and Klaipėda, and the current level of rents has reached the level of 2003.^[73] The costs for renting new warehouses in Vilnius, Kaunas and Klaipėda are similar and reach 2.6 to 4.9 LTL/m² (0.75 to 1.42 EUR/m²), while the rents of old warehouses are 1.2 to 2.3 LTL/m² (0.35 to 0.67 EUR/m²).

International trade[link]

Foreign trade, 1995–2008

International trade for such a small country as Lithuania is crucial. The ratio of foreign trade to GDP has always been at least 100%, and for the last several years exceeded it.

The EU is the biggest trade partner of Lithuania with a 58% of total imports and 64% of total exports during the first ten months of the year 2009.^[74] The Commonwealth of Independent States is the second economic union that Lithuania trades the most with, with a share of imports of 34% and a share of exports of 23% during the same period.^[74] The vast majority of commodities, including oil, gas and metals have to be imported, mainly from Russia. For this reason, Russia is the biggest import partner of Lithuania.

The import of mineral products has a significant share of 30%, as Lithuania has an oil refinery company owned by Polish concern PKN ORLEN, ORLEN Lietuva, with a refining capacity of 9 million tons a year.^[75] The revenues of the company were more than LTL 17 billion (EUR 4.9 billion) in 2008.^[75] Orlen Lietuva received 78% of its sales or LTL 13.7 billion (EUR 4 billion) from foreign markets^[75] in comparison with total export of Lithuania of LTL 55.5 billion (EUR 16.1 billion) in 2008.^[76]

Some sectors are directed mainly at export markets. Transport and logistics export 2/3 of their products and/or services; the biotechnology industry exports 80%; plastics export 52%; laser technologies export 86%; metal processing, machinery and electric equipment export 64%; furniture and wood processing export 55%; textile and clothing export 76%; and the food industry exports 36%.^[77]

The total value of natural resources in Lithuania reaches LTL 58 billion (EUR 16.8 billion) or 50% of Lithuania's GDP in 2008. The most valuable natural resource in Lithuania is subterranean water, which constitutes more than a half of the total value of natural resources.

Main export partners of Lithuania in 2010.

Foreign trade partners, January–December 2011^[78]

Country	Import	Country	Export
EU	55.9%	EU	61.4%
Russia	32.8%	Russia	16.6%
Germany	9.7%	Latvia	10.2%
Poland	9.1%	Germany	9.3%
Latvia	6.6%	Poland	6.9%
Netherlands	4.9%	Estonia	6.6%
Sweden	3.3%	Netherlands	6.1%
Italy	3.2%	Belarus	5.2%
Belgium	3.1%	United Kingdom	4.1%
Estonia	2.8%	France	4.1%
Belarus	2.5%	Sweden	3.6%

See also[link]

• Lithuania's Department of Statistics
• Public Organization "Invest Lithuania"
• Economy of Europe
• Lithuania

References[link]

v t e  Lithuania topics History Early history Baltic tribes Name of Lithuania Lithuania proper Grand Duchy of Lithuania History of Lithuania (1219–1295) Duchy of Lithuania Kingdom of Lithuania Christianization of Lithuania Polish–Lithuanian Commonwealth Revival & Independence Lithuanian press ban Lithuanian national revival Great Seimas of Vilnius Act of Independence Wars of Independence Lithuanian–Soviet War Polish–Lithuanian War WWII & Occupation Occupation of the Baltic states By the Soviet Union (1940) By Nazi Germany By the Soviet Union (1944) Resistance in Lithuania during World War II Baltic states under Soviet rule (1944–1991) Restoration Reform Movement of Lithuania Singing Revolution in Lithuania Baltic Way Act of the Re-Establishment of the State of Lithuania January Events in Lithuania Geography Extreme points of Lithuania Climate of Lithuania Regions of Lithuania List of cities in Lithuania Flora of Lithuania Lakes of Lithuania Rivers of Lithuania List of forests in Lithuania List of regional parks of Lithuania Politics Government & Law Constitution President Government Prime minister Parliament Political parties Elections Law Foreign relations Subdivisions Administrative divisions of Lithuania Counties of Lithuania Municipalities of Lithuania Elderships of Lithuania Military Lithuanian Armed Forces Land Force Naval Force Air Force Special Operations Force Economy Agriculture Communications Lithuanian litas Transport Airports Rail transport Roads Seaport Tourism Demographics Lithuanian people Ethnic minorities in Lithuania Religion in Lithuania Education in Lithuania Culture Lithuanian language Lithuanian literature Lithuanian music Sports in Lithuania Religion in Lithuania Lithuanian mythology Symbols Flag of Lithuania Coat of arms of Lithuania National anthem of Lithuania Category Commons Portal WikiProject

 This article incorporates public domain material from the United States Department of State document "Background Note: Lithuania" by Bureau of European and Eurasian Affairs (retrieved on 2009-10-17).

Republic of Lithuania Lietuvos Respublika
Flag Coat of arms
Anthem: Tautiška giesmė The National Hymn
Location of  Lithuania  (dark green) – in Europe  (green & dark grey) – in the European Union  (green)  —  [Legend]
Capital (and largest city)		Vilnius 54°41′N 25°19′E / 54.683°N 25.317°E / 54.683; 25.317
Official language(s)		Lithuanian
Ethnic groups (2011)		83.9% Lithuanians, 6.6% Poles, 5.4% Russians, 1.3% Belarusians, 3.8% others and unspecified[1]
Demonym		Lithuanian
Government		Parliamentary republic[2]
-	President	Dalia Grybauskaitė
-	Prime Minister	Andrius Kubilius
-	Seimas Speaker	Irena Degutienė
Legislature		Seimas
Independence		from Russia and Germany (1918)
-	First mention of Lithuania	9 March 1009
-	Coronation of Mindaugas	6 July 1253
-	Personal union with Poland	2 February 1386
-	Creation of the Polish–Lithuanian Commonwealth	1569
-	Partitions of the Commonwealth	1795
-	Independence declared	16 February 1918
-	1st and 2nd Soviet occupations	15 June 1940 and again 1944
-	Nazi German occupation	22 June 1941
-	Independence restored	11 March 1990
Area
-	Total	65,300 km2 (123rd) 25,174 sq mi
-	Water (%)	1.35%
Population
-	2012 estimate	3,187,176[3] (133rd)
-	2002 census	3,483,972
-	Density	50.3/km2 (120th) 141.2/sq mi
GDP (PPP)		2012 estimate
-	Total	$63.653 billion[4]
-	Per capita	$19,600[4]
GDP (nominal)		2012 estimate
-	Total	$42.438 billion[4]
-	Per capita	$13,068[4]
Gini (2008)		37.6 (medium)
HDI (2011)		0.810[5] (very high) (40th)
Currency		Lithuanian litas (Lt) (LTL)
Time zone		EET (UTC+2)
-	Summer (DST)	EEST (UTC+3)
Date formats		yyyy-mm-dd (CE)
Drives on the		right
ISO 3166 code		LT
Internet TLD		.lt1
Calling code		370
1	Also .eu, shared with other European Union member states.

Lithuania (ⁱ/ˌlɪθuːˈeɪniə/ or /ˌlɪθjuːˈeɪniə/; Lithuanian: Lietuva), officially the Republic of Lithuania (Lithuanian: Lietuvos Respublika) is a country in Northern Europe, the largest of the three Baltic states. It is situated along the southeastern shore of the Baltic Sea, whereby to the west lie Sweden and Denmark. It borders Latvia to the north, Belarus to the east and south, Poland to the south, and a Russian exclave (Kaliningrad Oblast) to the southwest. Lithuania has an estimated population of 3.2 million as of 2011, and its capital and largest city is Vilnius. The Lithuanians are a Baltic people, and the official language, Lithuanian, is one of only two living languages (together with Latvian) in the Baltic branch of the Indo-European language family.

For centuries, the southeastern shore of the Baltic Sea was inhabited by various Baltic tribes. In the 1230s the Lithuanian lands were united by Mindaugas, who was crowned as King of the Grand Duchy of Lithuania, the first Lithuanian state, on 6 July 1253.^[6] During the 14th century, the Grand Duchy of Lithuania was the largest country in Europe: present-day Belarus, Ukraine, and parts of Poland and Russia were territories of the Grand Duchy of Lithuania. With the Lublin Union of 1569, Lithuania and Poland formed a voluntary two-state union, the Polish–Lithuanian Commonwealth. The Commonwealth lasted more than two centuries, until neighboring countries systematically dismantled it from 1772 to 1795, with the Russian Empire annexing most of Lithuania's territory.

In the aftermath of World War I, Lithuania's Act of Independence was signed on 16 February 1918, declaring the re-establishment of a sovereign state. Starting in 1940, Lithuania was occupied first by the Soviet Union and then by Nazi Germany. As World War II neared its end in 1944 and the Germans retreated, the Soviet Union reoccupied Lithuania.

On 11 March 1990, the year before the break-up of the Soviet Union, Lithuania became the first Soviet republic to declare independence. Prior to the global financial crisis of 2007–2010, Lithuania had one of the fastest growing economies in the European Union. Lithuania is a member of NATO, the Council of Europe, and the European Union. Lithuania is also a full member of the Schengen Agreement.^[7] The United Nations Human Development Index lists Lithuania as a "Very High Human Development" country. In 2011, Lithuania hosted the European men's basketball championship, EuroBasket 2011, and the Organization for Security and Co-operation in Europe Ministerial Council Meeting.

History[link]

Prehistoric[link]

The first people settled in the territory of Lithuania after the last glacial period in the 10th millennium BC. Over a millennium, the Proto-Indo-Europeans, who arrived in the 3rd – 2nd millennium BC, mixed with the local population and formed various Baltic tribes. The first written mention of Lithuania is found in a medieval German manuscript, the Annals of Quedlinburg, in an entry dated 9 March 1009.^[8]

Medieval[link]

Trakai Island Castle

Initially inhabited by fragmented Baltic tribes, in the 1230s the Lithuanian lands were united by Mindaugas, who was crowned as King of Lithuania on 6 July 1253.^[6] After his assassination in 1263, pagan Lithuania was a target of the Christian crusades of the Teutonic Knights and the Livonian Order. Despite the devastating century-long struggle with the Orders, the Grand Duchy of Lithuania expanded rapidly, overtaking former Slavic principalities of Kievan Rus'.

By the end of the 14th century, Lithuania was one of the largest countries in Europe and included present-day Belarus, Ukraine, and parts of Poland and Russia.^[9] The geopolitical situation between the west and the east determined the multicultural and multi-confessional character of the Grand Duchy of Lithuania. The ruling elite practiced religious tolerance and borrowed Chancery Slavonic language as an auxiliary language to the Latin for official documents.

Battle of Grunwald and Vytautas the Great in the centre

In 1385, the Grand Duke Jogaila accepted Poland's offer to become its king. Jogaila embarked on gradual christianization of Lithuania and established a personal union between Poland and Lithuania. It implied that Lithuania, the fiercely independent land, was one of the last pagan areas of Europe to adopt Christianity.

After two civil wars, Vytautas the Great became the Grand Duke of Lithuania in 1392. During his reign, Lithuania reached the peak of its territorial expansion, centralization of the state was begun, and the Lithuanian nobility became increasingly prominent in state politics. Thanks to close cooperation, the armies of Lithuania and Poland achieved a great victory over the Teutonic Knights in 1410 at the Battle of Grunwald, one of the largest battles of medieval Europe.^[10][11][12]

After the deaths of Jogaila and Vytautas, the Lithuanian nobility attempted to break the union between Poland and Lithuania, independently selecting Grand Dukes from the Jagiellon dynasty. But, at the end of the 15th century, Lithuania was forced to seek a closer alliance with Poland when the growing power of the Grand Duchy of Moscow threatened Lithuania's Russian principalities and sparked the Muscovite–Lithuanian Wars and the Livonian War.

Modern[link]

The Polish–Lithuanian Commonwealth was created in 1569. As a member of the Commonwealth, Lithuania retained its institutions, including a separate army, currency, and statutory laws.^[13] Eventually Polonization affected all aspects of Lithuanian life: politics, language, culture, and national identity. From the mid-16th to the mid-17th centuries, culture, arts, and education flourished, fueled by the Renaissance and the Protestant Reformation. From 1573, the Kings of Poland and Grand Dukes of Lithuania were elected by the nobility, who were granted ever increasing Golden Liberties. These liberties, especially the liberum veto, led to anarchy and the eventual dissolution of the state.

During the Northern Wars (1655–1661), the Lithuanian territory and economy were devastated by the Swedish army. Before it could fully recover, Lithuania was ravaged during the Great Northern War (1700–1721). The war, plague, and famine caused the deaths of approximately 40% of the country's population.^[14] Foreign powers, especially Russia, became dominant in the domestic politics of the Commonwealth. Numerous factions among the nobility used the Golden Liberties to prevent any reforms. Eventually, the Commonwealth was partitioned in 1772, 1792, and 1795 by the Russian Empire, Prussia, and Habsburg Austria.

The largest area of Lithuanian territory became part of Russian Empire. After unsuccessful uprisings in 1831 and 1863, the Tsarist authorities implemented a number of Russification policies. They banned the Lithuanian press, closed cultural and educational institutions, and made Lithuania part of a new administrative region called Northwestern Krai. These ruthless Russification policies failed owing to extensive network of book smugglers and secret Lithuanian home schooling.

After the Russo-Turkish War (1877–1878), when German diplomats assigned what were seen as Russian spoils of war to Turkey, the relationship between Russia and the German Empire became complicated. The Russian Empire resumed the construction of fortresses at its western borders for defence against a potential invasion from Germany in the West. On 7 July 1879 the Russian Emperor Alexander II approved of a proposal from the Russian military leadership to build the largest "first-class" defensive structure in the entire state – the 65 km² (25 sq mi) Kaunas Fortress.^[15] Between 1868 and 1914, approximately 635,000 people, almost 20% of the population, emigrated from Lithuania.^[16] Large numbers of Lithuanians went to the United States in 1867–1868 after a famine.^[17] A Lithuanian National Revival laid the foundations of the modern Lithuanian nation and independent Lithuania.

20th and 21st centuries[link]

The original 20 members of the Council of Lithuania after signing the Act of Independence of Lithuania, 16 February 1918.

Map showing changes in the territory of Lithuania from the 13th century to the present day.

During World War I, the Council of Lithuania (Lietuvos Taryba) declared the independence of Lithuania on 16 February 1918, and the re-establishment of the Lithuanian State. Lithuania's foreign policy was dominated by territorial disputes with Poland and Germany. The Vilnius Region, and Vilnius, the historical capital of Lithuania, (and so designated in the Constitution of Lithuania) were seized by the Polish army during Żeligowski's Mutiny in October 1920 and annexed two years later by Poland. For 19 years Kaunas became the Temporary capital of Lithuania. The Polish occupation of Vilnius was greatly resented by Lithuania; there were no diplomatic relations between the two states for most of the period between the two world wars.

Acquired during the Klaipėda Revolt of 1923, the Klaipėda Region was ceded to Germany after a German ultimatum in March 1939. During the interwar period, the domestic affairs of Lithuania were controlled by the authoritarian President, Antanas Smetona and his party, the Lithuanian Nationalist Union, who came to power after the coup d'état of 1926.

The Soviet Union returned Vilnius to Lithuania after the Soviet invasion of Eastern Poland in September 1939.^[18] In June 1940, the Soviet Union occupied and annexed Lithuania in accordance to the secret protocols of Molotov–Ribbentrop Pact.^[19][20] A year later the Soviet Union was attacked by Nazi Germany, leading to the Nazi occupation of Lithuania. The Nazis and their collaborators murdered around 190,000 Jews of Lithuania^[21] (91% of the pre-war Jewish community) during the Holocaust.

After the retreat of the German armed forces, the Soviets re-established the annexation of Lithuania in 1944. It followed with massive deportations of citizens to Siberia,^[22] complete nationalisation and collectivisation and general sovietization of everyday life. From 1944 to 1952 approximately 100,000 Lithuanian partisans fought a guerrilla war against the Soviet system. An estimated 30,000 partisans and their supporters were killed, and many more were arrested and deported to Siberian gulags. It is estimated that Lithuania lost 780,000 people during World War II.^[23]

The advent of perestroika and glasnost in the late 1980s allowed the establishment of Sąjūdis, an anti-communist independence movement. After a landslide victory in elections to the Supreme Soviet, members of Sąjūdis proclaimed Lithuania's independence on 11 March 1990, becoming the first Soviet republic to do so. The Soviet Union attempted to suppress the secession by imposing an economic blockade. Soviet troops attacked the Vilnius TV Tower and killed 14 Lithuanian civilians on the night of 13 January 1991 (January Events).^[24][25] On 31 July 1991 Soviet paramilitaries killed seven Lithuanian border guards on the Belarusian border in what became known as the Medininkai Massacre.

On 4 February 1991, Iceland became the first country to recognise Lithuanian independence. After the Soviet August Coup, independent Lithuania received wide official recognition and joined the United Nations on 17 September 1991. The last Soviet troops left Lithuania on 31 August 1993 – even earlier than they departed from East Germany. Lithuania, seeking closer ties with the West, applied for NATO membership in 1994. After a transition from a planned economy to a free market one, Lithuania became a full member of NATO and the European Union in the spring of 2004 and a member of the Schengen Agreement on 21 December 2007.

Geography[link]

Lithuania is located in Northern Europe. It covers an area of 65,200 km². Thus it is roughly larger, in terms of total area, than the Netherlands, Belgium, Denmark or Switzerland.

The Geographic Centre of Europe is in Lithuania

Lithuania lies between latitudes 53° and 57° N, and mostly between longitudes 21° and 27° E (part of the Curonian Spit lies west of 21°). It has around 99 kilometres (61.5 mi) of sandy coastline, of which only about 38 kilometres (24 mi) face the open Baltic Sea and which is the shortest among the Baltic Sea countries; the rest of the coast is sheltered by the Curonian sand peninsula. Lithuania's major warm-water port, Klaipėda, lies at the narrow mouth of the Curonian Lagoon (Lithuanian: Kuršių marios), a shallow lagoon extending south to Kaliningrad. The main and largest river, the Nemunas River, and some of its tributaries carry international shipping.

Lithuania lies at the edge of North European Plain. Its landscape has been smoothed by the glaciers of the last ice age. Lithuania's terrain is an alternation of moderate lowlands and highlands; its maximum elevation is Aukštojas Hill at 294 metres (965 ft) in the eastern part of the country. The terrain features numerous lakes, Lake Vištytis for example, and wetlands; a mixed forest zone covers nearly 33% of the country. The climate ranges between maritime and continental, with wet, moderate winters and mildly hot summers.

After a re-estimation of the boundaries of the continent of Europe in 1989, Jean-George Affholder, a scientist at the Institut Géographique National (French National Geographic Institute) determined that the Geographic Centre of Europe is located at 54°54′N 25°19′E / 54.9°N 25.317°E / 54.9; 25.317 (Purnuškės (centre of gravity)).^[26] The method used for calculating this point was that of the centre of gravity of the geometrical figure of Europe. This point is located in Lithuania, specifically 26 kilometres (16 mi) north of its capital city, Vilnius.

Climate[link]

Aukštaitija National Park

Lithuania's climate, which ranges between maritime and continental, is relatively mild. Average temperatures on the coast are −2.5 °C in January and 16 °C (61 °F) in July. In Vilnius the average temperatures are −6 °C (21 °F) in January and 16 °C (61 °F) in July. During the summer, 20 °C (68 °F) is common during the day while 14 °C (57 °F) is common at night; in the past, temperatures have reached as high as 30 °C (86 °F) or 35 °C (95 °F). Some winters can be very cold. −20 °C (−4 °F) occurs almost every winter. Winter extremes are −34 °C (−29 °F) in coastal areas and −43 °C (−45 °F) in the east of Lithuania.

Sand dunes of Curonian Spit (UNESCO World Heritage Site)

Lithuanian countryside

The average annual precipitation is 800 mm on the coast, 900 mm in the Samogitia highlands and 600 mm in the eastern part of the country. Snow occurs every year, it can snow from October to April. In some years sleet can fall in September or May. The growing season lasts 202 days in the western part of the country and 169 days in the eastern part. Severe storms are rare in the eastern part of Lithuania but common in the coastal areas.

The longest measured temperature records from the Baltic area cover about 250 years. The data show that there were warm periods during the latter half of the 18th century, and that the 19th century was a relatively cool period. An early 20th century warming culminated in the 1930s, followed by a smaller cooling that lasted until the 1960s. A warming trend has persisted since then.^[27]

Lithuania experienced a drought in 2002, causing forest and peat bog fires.^[28] The country suffered along with the rest of Northwestern Europe during a heat wave in the summer of 2006.

Reported extreme temperatures in Lithuania by month are following:^[29]

Politics[link]

Dalia Grybauskaitė has been the President of Lithuania since 12 July 2009.

Since Lithuania declared the restoration of its independence on 11 March 1990, it has maintained strong democratic traditions. In the first general elections after the independence on 25 October 1992, 56.75% of the total number of voters supported the new constitution.^[30] There were intense debates concerning the constitution, especially the role of the president. A separate referendum was held on 23 May 1992 to gauge public opinion on the matter and 41% of all the eligible voters supported the restoration of the President of Lithuania.^[30] According to the explanation of Constitutional Court of Lithuania on 10 January 1998, Republic of Lithuania is a parliamentary Republic with some semi-presidential features inside of parliamentary republic type.^[31]

The Lithuanian head of state is the President, elected directly for a five-year term, serving a maximum of two consecutive terms. The post of president is largely ceremonial; main policy functions however include foreign affairs and national security policy. The president is also the military commander-in-chief. The President, with the approval of the parliamentary body, the Seimas, also appoints the Prime Minister and, on the latter's nomination, the rest of the cabinet, as well as a number of other top civil servants and the judges for all courts.

The current Lithuanian head of state, Dalia Grybauskaitė was elected on 17 May 2009 becoming the first female President in the country's history. This marked a dramatic shift in Eastern European politics after its European neighbour, Latvia elected their first female political leader late on in the previous decade.^[32]

The judges of the Constitutional Court (Konstitucinis Teismas), who serve nine-year terms, are appointed by the President (three judges), the Chairman of the Seimas (three judges) and the Chairman of the Supreme Court (three judges). The unicameral Lithuanian parliament, the Seimas, has 141 members who are elected to four-year terms. 71 of the members of this legislative body are elected in single member constituencies, and the other 70 are elected in a nationwide vote by proportional representation. A party must receive at least 5% of the national vote to be eligible for the 70 national seats in the Seimas.

Administrative divisions[link]

Alytus County

Kaunas County

Klaipėda
County

Marijampolė
County

Panevėžys County

Šiauliai County

Tauragė County

Telšiai County

Utena County

Vilnius County

Baltic sea

Latvia

Belarus

Poland

Russia

The current administrative division was established in 1994 and modified in 2000 to meet the requirements of the European Union. Lithuania has a three-tier administrative division: the country is divided into 10 counties (Lithuanian: singular – apskritis, plural – apskritys) that are further subdivided into 60 municipalities (Lithuanian: singular – savivaldybė, plural – savivaldybės) which consist of over 500 elderships (Lithuanian: singular – seniūnija, plural – seniūnijos).

The counties are ruled by county governors (Lithuanian: apskrities viršininkas) appointed by the central government. They ensure that the municipalities adhere to the laws of Lithuania and the constitution. County government oversees local governments and their implementation of the national laws, programs and policies.^[33] As the counties have limited functions, there are numerous proposals to reduce their number and organize the new counties around the ethnographic regions of Lithuania^[34] or five major cities with population over 100,000.^[35]

Municipalities are the most important administrative unit. Some municipalities are historically called "district municipalities", and thus are often shortened to "district"; others are called "city municipalities", sometimes shortened to "city". Each municipality has its own elected government. In the past, the election of municipality councils occurred once every three years, but it now takes place every four years. The council elects the mayor and appoints elders to govern the elderships. There is currently a proposal for direct election of mayors and elders, however that would require an amendment to the constitution.^[36]

Elderships, numbering over 500, are the smallest units and do not play a role in national politics. They provide necessary public services close to their homes; for example, in rural areas the elderships register births and deaths. They are most active in the social sector: they identify needy individuals or families and distribute welfare or organise other forms of relief.^[37] While the elderships have a potential of becoming a source of local initiative to tackle rural problems, complaints are made that elderships have no real power and receive too little attention.^[38]

Foreign relations[link]