Economic trends
Lithuania became independent in 1990. Since then, it has gradually moved from a centrally planned economy to a free market economy. After its independence, the country started a process of privatization aimed at freeing the economy. In recent years, the economy has had strong growth (an average 8%). Private consumption and foreign investments are the main economic growth drivers. It should be noted that Lithuania received a substantial amount of financial support from the European Union, which provided a good opportunity to modernize the country's different sectors.
Even though its economy was already showing signs of being in trouble before the crisis hit, Lithuania was affected by the 2008 financial crisis. The progressive inflation that was difficult to control, as well as the trade balance deficit worsened with the onset of the crisis. Therefore, Lithuania went into recession in 2009, a fact that translated into a drop in domestic demand. However, of the three Baltic states, Lithuania appears to be the least affected due to its banking system, which is less exposed, and the diversity of its industrial sector.
Main branches of industry
Agriculture contributes around 5% of the GDP. Lithuania's main agricultural produce is wheat, wood, oats, potatoes, wine and meat (beef, mutton and pork). Nearly 13% of the active population works in agriculture.
The main industrial sectors of Lithuania are electronics, chemical products, capital equipment, metal processing, construction material, food processing and light industry (including textile), clothing, furniture and household appliances. The industrial sector contributes around one third of the GDP.
Lastly, services contribute almost 60% of the GDP.
International trade
In 2007, Lithuanian exports and imports reached EUR 12.5 billion and EUR 17.8 billion respectively, i.e an 11% increase in exports and 15% increase in imports, compared to 2006. Therefore, Lithuanian foreign trade shows a deficit insofar as the value of imports is greater than that of exports. This can largely be explained by the fact that the country imports a large quantity of gas from Russia, whose prices were raised in recent years.
In 2008, export increased by nearly 28%, with mineral products in the lead (more than 26% of the total). Russia is Lithuania's main export partner. Other export partners are Latvia, Germany and Poland. The majority of the country's imports come from European Union member countries. Lithuania's main suppliers are Russia, Germany, Poland, the Netherlands and Latvia. The country mainly imports mineral fuels, oil, vehicles, electrical and electronic equipment, and plastics.
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