The Smart Move

Lithuania – the Smart MoveAmbassador Jonas PaslauskasConsul General of the Republic of Lithuania in New York

LithuaniaLithuania

Population: 3.4 M

Area: 65,300 sq. km

In-between Huge MarketsIn-between Huge Markets

250 million CIS consumers

340 million Western European consumers

110 million Baltic Sea Region consumers

Total Baltic GDP

Lithuania 47% Latvia 29%

Estonia 24%

One the Best Performing EU One the Best Performing EU EconomiesEconomies • Performance ranked as one of the best in the European Union (IMF)

• Very low economic and political risks (“Economist

Intelligence Unit”, the research subdivision of “The Economist” magazine)

• Easiest place to do business among new EU members (World Bank)

According to “Eurostat”, the EU statistics agency,

the annual increase of Lithuanian industry production

(13.7%) is three times greater than

the EU industry growth and the biggest among all EU

members

2002 2003 2004 2005 2006 2007

GDP growth (%)

6.8 10.5 7 7.5 7.7 8*

CumulativeFDI (€ bn)

3.8 4 4.7 5.4 8.3 9,2**

Source: Lithuanian Department of Statistics, DnB Nord *2007 second quarter data ** as of April 1, 2007

LithuaniaLithuanian Economy at a Glancen Economy at a Glance - I - I

2002 2003 2004 2005 2006 2007

Exports (€ bn)

5.9 6.4 7.4 9.5 11.2 7*

Imports (€ bn)

8.3 8.8 9.8 12.5 15.4 10*

Source: Lithuanian Department of Statistics, DnB Nord * as of August 1, 2007

LithuaniaLithuanian Economy at a Glancen Economy at a Glance - II - II

Export / import growth forecasts

During the first 7 months of 2007, in comparison with the same period of 2006, Lithuania’s exports increased almost 10%, and imports leaped 17%.

Exports growth was much influenced by the increase of exports of the following production: fertilizers, vehicles, articles of plastics, machinery and equipment

Increasing imports of vehicles, chemical products, iron and steel had an influence upon the rapid growth of Lithuania’s imports during the first 7 months of 2007

2002 2003 2004 2005 2006 2007

Inflation -1% -1.3% 2.9% 3% 4.5% 4.5*

Unemployment rate

13.8% 12.4% 11.4% 8.3% 5.6% n/a

Source: Lithuanian Department of Statistics, DnB Nord *Forecasts

LithuaniaLithuanian Economy at a Glancen Economy at a Glance - III - III

Lithuanian GDP

Construction7%

Industry26%Agriculture

6%

Services61%

Source: Lithuanian Department of Statistics

9200

469039683821

308827072392

6921

8333

1999 2000 2001 2002 2003 2004 2005 2006 April 2007


(€ mln)


Cumulative FDI in Lithuania

Finland6.7%

USA2.8%

Germany9.9%Denmark

15.3%

Estonia5.9% Russia

6.3%

Sweden10.6%

Other15.1%

Poland 22.6%

Major Countries Investors as of January 1, 2007


Top InvestorsTop Investors

http://www.tele2.com/pages/StartPage.aspx?id=77

MAJORMAJOR US INVESTORS IN US INVESTORS IN LITHUANIALITHUANIA (ml(mlnn Euro) Euro)

PHILIP MORRIS 87 MARS INC. 44 KRAFT FOODS 37 COCA-COLA 36 McDonald's 10

FDI in Lithuania by Sector as of January 1, 2007

Electricity, Gas, Water Supply

10.6%

Manufacturing39.9%

Wholesale and Retail Trade

10.7%

Other4.3%

Financial I ntermediation

16%Transport, Storage

and Communication

10.9%Real Estate, Renting and

Business Activities7.6%

0

5000

10000

15000

20000

Exports 4302 3483 4417 5314 5881 6158 7478 9490 11240

Imports 6717 5605 6326 7366 8279 8526 9958 12498 15371

1998 1999 2000 2001 2002 2003 2004 2005 2006



Lithuania’s Foreign Trade(€ mln)

USA4.3%

Estonia6.5%

Denmark4.2%

Poland6%

Other32.6%

Sweden4.6%

UK4.3%

Netherlands4.9%

Russia12.8%

Latvia11.1%

Germany8.7%



Lithuania’s Major Exports Destinations 2006

Chemical Products

6.5%Miscellaneous manufactured

articles6.2%

Plastics and articles thereof5.2%

Prepared foodstuffs;beverages;toba

cco5.8%

Animal products

4.6%

Other17.1% Transport

means10.1%

Textiles and textile articles8.3%

Machinery and

equipment12.2%

Mineral products

24%

Lithuania’s Exports by Products, 2006


Estonia3.1%

Finland2.9%

Latvia4.8%France

3.2%

Netherlands3.7%

Sweden3.3%

Italy3.4%

Germany14.8%

Poland9.6%

Russia22.4%

Other26.8%

Lithuania’s Major Imports Partners, 2006


Lithuania’s Imports by Products, 2006Mineral

products23.6%

Machinery and

equipment17.6%

Transport means13.9%

Chemical Products

8.3%Base metals and articles

thereof7.1%

Other15.3%

Textiles and textile articles

5%

Plastics and articles thereof5.2%

Prepared foodstuffs; beverages;

tobacco4%


Excellent InfrastructureExcellent Infrastructure

• The “Economist Intelligence Unit” (the research subdivision of “The Economist” magazine) evaluated Lithuania as a country maintaining a convenient infrastructure for business

• Northernmost ice-free port on the eastern shore of the Baltic Sea

• Best roads among the Baltic States

Excellent InfrastructureExcellent Infrastructure

• International airports (located in Central, Eastern and Western Lithuania) with direct routes to most European cities

• Convenient system of logistics & warehousing

facilities in Lithuania’s major industrial hubs

• Plenty of well-equipped office premises

Lithuania’s “Gold and Oil”Lithuania’s “Gold and Oil”

• Best educated human resources in Central and Eastern Europe (CEE); proportion of graduates highest in CEE (4.3 per year per 1000 inhabitants)

• Universities in all 5 major economic centres; largest technical university in the Baltic States

Source: Eurostat; public opinion analysis „Europeans and Languages“ by the European Commission

Lithuania’s “Gold and Oil”Lithuania’s “Gold and Oil”

• Kaunas University of Technology (KTU) www.ktu.lt – largest technical university in the Baltic States

• 90% of Lithuanians can speak at least one other language apart from their mother tongue, mostly Russian, English and Polish

Source: Eurostat; public opinion analysis „Europeans and Languages“ by the European Commission

One of the Most Business-One of the Most Business-friendly Tax Policies in the EUfriendly Tax Policies in the EU

29,229,529,63132,2

34,236,3

38,640,8

0 10 20 30 40 50

LithuaniaSlovak Rep.

LatviaEstoniaIrelandPoland

Czech Rep.Hungary

EU-25

Efficient Industry Base

Lithuanian Development Agency (LDA)

provides relevant business information services investors through the investment decision process

identifies local suppliers and sourcing organizes site and company visits

is represented in Germany, Italy and Belgium

Lithuanian Embassy in Washington DCTwo Lithuanian Consulates General – in New York and Chicago

Fifthteen Lithuanian Honorary Consuls all over USA

Lithuanian American Business Council Baltnet is a corporative member of LABC)

WWW.BUSINESSLITHUANIA.COM [email protected] WWW.LTCONSNY.ORG

To start a business in Lithuania

mailto:[email protected]

http://www.labcny.org/

Lithuania - Summary I Located at the crossroads of Scandinavian, East

European and West European markets, offering knowledge-economy-oriented business environment, one of the most qualified human resources in the EU, a wide range of investment incentives (free economic zones with tax benefits and one-stop-shop services, industrial parks with developed infrastructure, access to EU Structural Funds support etc.) and the most diversified industry base among the Baltic States, Lithuania is a treasure to be discovered by foreign investors and businessmen looking for reliable business partnership and opportunities to expand their business activities.

Lithuania - Summary II Lithuania invites foreign businesses to use

the opportunity to expand their activities to the booming Lithuanian market and to join the conglomerate of many big corporate names, such as Microsoft, IBM, Philip Morris, HP, AON, Coca-Cola, Kraft Foods, Masterfoods, Siemens, Dalkia, Yazaki, SEB, TeliaSonera, Marzotto, Transcom Worldwide, DSV, Schenker, Indorama and many others, who are already at home in Lithuania. Refresh your investment portfolio and discover new opportunities in a prospering Lithuanian economy!

Laser technology in Lithuania

The French daily “Le Monde” has recently published an article about Lithuania’s world-leading laser manufacturers.

According to “Le Monde”, Lithuania is the biggest exporter of femtosecond lasers in the world. The Lithuanian laser technologies producer UAB “Šviesos konversija” only holds 80% of the global market of femtosecond lasers.

A country of 3.5 million people, Lithuania, has about 15 laser producers, employing about 300 laser specialists, half of which are engineers and doctors of sciences. Lithuania’s laser sector grows about 15-20 % annualy, which is twice faster than the whole economy of the country. The Lithuanian laser production is demanded by the best scientific laboratories in Europe and the US.

In 2008 a laser innovation center is planned to be established in Lithuania. Also, Lithuania expects to receive about EUR 600 million for scientific research and technology developments from the EU Structural funds for the period till 2013.

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