Growth slows from eurozone crisis

VILNIUS - The fast pace of Lithuania’s economic growth, even in the light of higher uncertainty about the eurozone debt crisis, should not surprise us since the current situation in the country is completely different from that in autumn of 2008, says chief economist at Swedbank Lithuania Nerijus Maciulis, reports ELTA.

“The eurozone debt crisis tension that rose in late 2011 reminded many of us of the autumn of 2008. Back then, Lithuania’s economy was almost paralyzed and suffered an unprecedented downturn as the global financial crisis started. However, the current situation in the country is entirely different. First of all, even though the eurozone is experiencing a recession, the countries have managed to prevent a financial crisis. The problems remained confined to a particular region and did not disrupt global trade. Secondly, Lithuania’s economy at the moment is well-balanced and prepared to accept external challenges,” the economist said.

Swedbank forecasts Lithuania’s economy to expand 3.3 percent this year. The growth should accelerate in 2013 and reach 4.3 percent. The Bank of Lithuania offers a less optimistic forecast at 2.2 percent.
Data show that Lithuania’s economic growth slowed in the first quarter as the European debt crisis sapped demand for Lithuania’s exports. Gross domestic product (GDP) grew a preliminary 3.9 percent from a year earlier, compared with a 4.4 percent increase in the previous three months, Lithuania Statistics said on April 30. The median estimate of six economists in a Bloomberg survey was 3.5 percent. The economy grew a seasonally adjusted 0.8 percent in the January-March period.

Lithuania’s economy grew at the second-fastest pace in the European Union in the fourth quarter before the crisis hit exports. The Finance Ministry estimates economic growth may slow to 2.5 percent this year from 5.9 percent last year.