Economy review

 

GDP growth remains high. In the third quarter of 2017, as compared to the same period of the previous year, Lithuania`s GDP grew by 3.4% and accounted to €11.2 billion at current prices. The economic growth driven by the household consumption and investments, meanwhile gross export made negative impact. In the period under review, the household consumption increased by 1.0% or by 4.7 percentage point lower than in the second quarter of this year. The slump possibly affected by the acceleration of the growth in inflation. Public spending picked up by 1.5%. The highest growth of gross value added was in wholesale and retail trade, repair of motor vehicles and motorcycles, manufacturing and construction activities. The decline was only in the agriculture, forestry, fishing and real estate operation sectors.

The gross fixed capital formation boosted by the construction and transport equipment. In the period under review, the gross fixed capital formation increased by 9.3% and amounted to €2.1 billion (the highest level since pre-crisis level). The growth of investment in engineering structures, non-residential buildings and transport equipment were among the main drivers of increase in investment activities. The investment in ITC products grew by 4.5%, meanwhile it picked-up by 15.0% in to intellectual property products.

Higher inflation drives down the growth in real wages. In the third quarter of 2017, as compared to the same period of the previous year, real average monthly wage increased by 7.2%. It was the lowest level since the first quarter of 2016. Gross monthly earning increased by €57.5 and amounted to €850.8. The unemployment rate fell by 0.9 percentage points and reached 6.6%. The number of employees in Lithuania (individual enterprises excluded) increased by 0.8% or by 9.7 thousand. In private sector it grew by 17.9 thousand, meanwhile in public sector it fell by 8.1 thousands. The highest increase in number of employees in private sector was in transportation and storage, manufacturing, administrative and support service activity sectors.

Exports of goods keeps growing at a high rate. In the third quarter of 2017 as compared to the same period of the previous year, the value of exports of goods increased by 14.7%. The growth in exports of goods was due to a rise in all kinds of export. The growth of exports of refined petroleum products amounted to 22.7%, an increase in re-exports of goods - 20.2%. The exports of Lithuanian origin goods (energy products excluded) increased by 8.6% (mostly machinery and equipment, dairy products, furniture and tobacco). The exports of Lithuanian origin goods (energy products excluded) forecasted to grow by 12% in 2017 and by 6.5% in 2018.

Industrial output – the 2nd fastest growing in the EU. In the period under review, as compared to the same period of the previous year, industrial production increased by 8.8% and amounted to €5.66 billion. It mostly driven by the manufacture of machinery and equipment, metal products, furniture, motor vehicles, trailers and semi-trailers. The number of employees in industry sector grew by 1.5%, meanwhile revenues up by 12.7%.

The growth of construction sector accelerated. In the third quarter of 2017, as compared to the same period of the previous year, the volume of construction works carried out within the country increased by 10.8% and amounted to €0.75 billion. The main driver of growth was an investment into engineering structures and non-residential buildings. The number of employees in construction sector grew by 2.7%, meanwhile revenues up by 27.4%.

The growth in retail trade reached their lowest level of the past eighteen months. In the period under review, annual change in turnover of retail trade was 7.1% and reached €2.67 billion at current prices (real annual change – 2.9%). The real annual growth was only in automobile fuel and non-food retail.

 

Last updated: 06-04-2016