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EBRD launches new strategy for Lithuania
Lithuania is continuing to make progress with the establishment of a strong
market economy. The economy grew by more than 7 per cent on average every year
since 2000 fueled by strong domestic consumption and investment demand.
Lithuania was admitted to the European Exchange Rate Mechanism (ERM II) last
May.
However, a number of key challenges remain as the EBRD states in its new strategy
for Lithuania. In its assessment the Bank has identified the following
priorities:
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Infrastructure, environment and energy: Although the country has extensive
investment needs, there is limited private sector participation in municipal
infrastructure development. Energy efficiency urgently needs improvement,
especially as the closure of the Ignalina Nuclear Power Plant by the end of
2009 will be a key challenge for the future energy supply of the country.
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Enterprise sector: Further improvements in the business environment are
needed, including consistent enforcement of laws, reduction in corruption and
improved transparency in public procurement.
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Financial sector: Financial intermediation remains low, particularly to the
SME sector.
The EBRD remains committed to playing a key role in addressing these
challenges and will focus on:
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Supporting large, complex or sensitive transactions that would benefit from
the Bank’s expertise;
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Supporting the expansion of local companies, particularly in cross-border
projects;
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Promoting SME and municipal financing and energy efficiency;
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Encouraging the development of local capital markets, for example through
investing in the local securitisation of mortgage loans.
As of end-2005 the Bank had signed a cumulative total of 31 projects in
Lithuania with a total project investment value of €1.1 billion, of which 67
per cent of all projects were in the private sector.
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