Lithuania’s economy will grow approximately by 1.3 % next year, outpacing other countries, chief economist of the Organization for Economic Cooperation and Development (OECD) has said, calling on the country to continue its reform efforts in order to remain competitive.
“There will be a slowdown for sure, but Lithuania’s economy will grow by 1.3% in 2023 – at a more rapid pace compared to other countries. However, this will depend on the war, on the economies of other countries. Other factors beyond Lithuania’s control will have an even stronger impact on economic slowdown,” Alvaro Pereira said during a presentation of OECD’s Economic Survey of Lithuania 2022 in Vilnius on October 20.
“As far as economic reforms are concerned, Lithuania is surprising. It is resilient, therefore, our forecast for Lithuania is better than for other countries,” he added.
Finance Minister Gintare Skaiste said that the government expected the economy to grow by approximately 1.5% in 2023.
“We hope the economy will stay on the growth path and the pace of growth will reach approximately 1.5%,” she noted.
The OECD expects Lithuania’s gross domestic product (GDP) to grow by 1.6% this year.
The organization estimates that the jobless rate in Lithuania will rise by 0.7%, to 6.5% next year, average inflation will fall to 10.4% from 17.6%, general government deficit will go down to 3.6% of GDP next year from 4.2% projected in 2022 and general government debt will increase to 55.1% of GDP from 52.8%.
The OECD recommends Lithuania to tighten fiscal policy at an appropriate pace to help mitigate inflationary pressures, to address problems related to population ageing, to help households and businesses cope with rising energy costs using targeted and temporary measures and to respond to negative tendencies in the real estate market in a timely manner. (LRT/Business World Magazine)