Lithuania Economic conditions

Lithuania Population and Economic Conditions

Physical characteristics

The Lithuania it does not correspond to a well-defined geographical region: it is a small peripheral part of the Russian lowland, which is almost flat and scarcely subject to dislocations. By far the most important river is the Nemunas which for about half of its course (890 km in all) flows through Lithuanian territories. It passes through Kaunas and flows into Kursky zaliv to the South of Klaipėda. Its main tributary is the Neris. The climate is transitional between maritime and continental influences. Towards the interior, winters become more rigid, summers warmer and rainfall becomes less abundant. The ground is covered by snow on average for 80 days a year. The vegetation has remained almost intact in several places. The woods, which occupy about a quarter of the territory, are largely made up of coniferous trees.


The population consists of Lithuanians, who by language belong to the Baltic branch of the Indo-European language family, and small Russian and Polish minorities. Before 1914 the Lithuania was characterized by a strong emigration, so there are many Lithuanians who live outside the state. Even more than those residing in neighboring countries, what counts is the nucleus that has moved to the USA, since it has kept the Lithuanian culture and language alive ; they reside above all in the triangle whose vertices are Boston, Baltimore and Chicago.

79% of Lithuanians profess the Catholic religion.

Economic conditions

Since independence (1991), the Lithuanian economy has undergone a rapid and decisive transition from a planned and centralized system to a typically market one, dominated by private companies and aimed at exports. Obviously, that transition was anything but painless. While the government carried out the main economic reforms, including the liberalization of prices, the privatization of the productive apparatus, the introduction of the litas as the national currency, there was a decrease in industrial production (-40% between 1992 and 1995) and an increase in unemployment and inflation. Lithuania also suffered heavily from the consequences of the Russian recession and financial crisis (August 1998), as the Baltic state maintained the largest commercial relations with Moscow. For Lithuania economics and business, please check

The economy is characterized by the scarcity of raw materials (limited to peat and small quantities of oil in Kretinga, 25 km N of Klaipėda) and the need to import oil and gas from Russia. Agriculture, despite having vast cultivated areas (over 40% of the national territory) and a high degree of mechanization, is rather in crisis due to the difficulties in marketing the products. The main crops are cereals (wheat, barley, rye), sugar beets, potatoes, flax and vegetables. Breeding developed (poultry, pigs and cattle). Fishing is very active and has as its main base the port of Klaipėda, where related industrial establishments (fish conservation) have also sprung up. From the intensely exploited coniferous forests,3of timber. The industry is well developed, diversified and technologically advanced. The production system is powered mainly by the Ignalina nuclear power plant, whose energy, in addition to satisfying a large part of the internal needs, is exported to Latvia. Basic industries include the Mažeikiai refinery and the petrochemical plants of Klaipėda, Kaunas, Jonava and Vilnius. The electrotechnical and electronic sectors are also concentrated in the capital. There is no shortage of traditional sectors (food, textiles and the paper industry), while the amber processing is characteristic. In the second half of the 1990s, some free zones were established (the largest in 2000, near Klaipėda) which attracted numerous foreign investments, thanks to the low cost of labor, including skilled ones, and ease of access to the Russian, Belarusian and Ukrainian markets; these investments, in particular Scandinavian ones, have above all encouraged the growth of the information technology industry. The tertiary sector is growing both in the commercial and in the services sectors. Tourism, which developed in the late 1990s, attracts flows of visitors mainly from Russia, Germany and Poland.

Lithuania Economic conditions