“This year should be better for business - domestic consumption will remain strong, while along with the stabilising international environment and the strengthening of the euro zone, exports should grow as well,” said Antanas Sagatauskas, the head of Swedbank business customer service.
Lithuanian companies managed to easily overcome a temporary economic slowdown last year and this year have a more optimistic outlook and should show higher growth, he said. Swedbank economists predict that this year Lithuania's GDP will grow by 3.3%.
“The growth slowdown was largely due to the unstable external environment. Closure of Eastern markets forced exporters to quickly find new markets. Assessing the last year's results, we can see that business has withstood this challenge better than expected. Part of the losses were absorbed by discovering new markets, another part – by using growing domestic demand,” Sagatauskas said.
Sagatauskas said that last year the real estate sector had surprisingly good results - during the third quarter of 2015, only 2% fewer flats were sold in Vilnius than in the same period in 2014. This compares with Riga where sales dropped 10%, while in Tallinn 15% more apartments were sold.
The construction sector will grow in 2016 because of growing demand for modern offices.
“All the new offices in Vilnius are leased. This is one of the indicators showing the overall business expectations for the future. In modern office space, Vilnius is still lagging behind from Riga and Tallinn – in Vilnius the office space amounts to 0.96 sq. m. per capita, while in Tallinn it is 1.25 sq. m. So we have room to grow.”
Mr. Sagatauskas said that household consumption this year should grow by 4.7 percent.
Last year the Baltics states economies grew at significantly different rates. In Lithuania and Estonia GDP grew by 1.6% and 1.2% respectively, in Latvia by 2.8%.