Lithuania’s central bank has decreased its projections for GDP growth in Lithuania next year, citing sanctions against Belarus and decreased consumer spending.
The economy is projected to grow by 4.9% in 2021 and by 3.5% in 2022. In June, Lithuanian Bank (Lietuvos Bankas) said the economy would grow by 5.1% in 2021 and by 4.1% the following year.
“This has to do with a smaller growth in exports, which will be determined by sanctions against Belarus,” said Gediminas Simkus, head of Lithuanian Bank. “However, this should not have a strong impact on domestic demand. Forecasts for both investment and consumer consumption are more favorable than in June.”
If Lithuania was to completely restrict trade relations with Belarus and China, the country’s GDP growth per year would decrease by 1%.
“Lithuania’s exports to Belarus make up 4% of the country’s exports, with big part of it being re-exported goods and transport services,” said Simkus. “Lithuanian products make up a small part. When looking at the effects on the economy, the largest part of these effects would come next year.” (LRT/Business World Magazine)