VILNIUS 's Lithuanian Prime Minister Gediminas Kirkilas is remaining sanguine in the face of a credit agency's decision to downgrade its rating of his country's economic prospects.
"The fact that the credit rating agency Fitch has changed the outlook on Lithuania's rating from stable to negative is not pleasant to us, but we'll make no tragedy out of it either," said Kirkilas.
According to the Prime Minister, a deeper analysis shows that Lithuania's current macroeconomic situation is sustainable. Although increased inflation and a large current account deficit are a cause for concern, there is no major risk of overheating, he maintains.
In the Prime Ministers' view, the Fitch assessment is based on "a somewhat superficial attitude towards the Lithuanian economy" which concentrates on only two indicators -- inflation and the current account deficit.
"The Baltic States have been rapidly catching up with the other EU Member States; they receive substantial amounts from the EU support funds every year. Today Lithuania's GDP is growing s three times faster against the EU average, and we may wish the convergence of living standards was also faster, but any serious hopes of that would be unrealistic," a statement from Kirkilas' office said.
Kirkilas also pointed towards its successful recent Eurobond issue as evidence of the underlying strength of the economy.
"Moreover, as we can see the first signs of a gradual and smooth slowdown, which in time will lead to a decline of inflation, it is crucial to ensure that the measures taken would not slow growth too much and the smooth slowdown, which is our target, would not turn into a slump", said Kirkilas.
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