Lithuania Business Forecast Q1 2007

Content

• Executive Summary
  • Focus On 2007
• Chapter 1: Political Outlook
  • SWOT Analysis
  • BMI Political Risk Ratings
  • Domestic Political Outlook
  • Survival Prospects Increase
  • The lack of a parliamentary majority does not appear to be deterring the coalition government from promoting its
  • policy agenda Competent management and careful consensus building suggest it may achieve rather more than
  • previously expected But just how much more is uncertain, as electoral considerations could still trigger further
  • bouts of political turbulence and lead to policy deadlock
  • Table: Lithuanian Cabinet (As Of December 2006)
• Chapter 2: Economic Outlook
  • SWOT Analysis
  • BMI Economic Risk Ratings
  • Economic Activity
  • Growth Slows Sharply In Q306
  • Provisional estimates reveal that the economy slowed sharply in Q306 The slowdown is likely to prove temporary,
  • however Faster growth can be expected going into 2007, although the trend will be towards lower and more
  • sustainable growth further ahead as world growth slows, domestic financial conditions tighten, and supply-side
  • bottlenecks begin to bind
  • Table: Indicators Of Economic Activity
  • Fiscal Policy
  • Government Approves Socially Oriented Budget For 2007
  • Budget plans for 2007 suggest that Lithuania will again comfortably meet the Maastricht Treaty fiscal criteria
  • But they fall short of providing the significant fiscal tightening that the European Commission and IMF believe
  • is needed, if the Maastricht inflation criterion is to be met in time to adopt the euro by the government's new
  • target date of January 2010
  • Table: Key Fiscal Data
  • Balance Of Payments
  • Current Account Widens, External Debt Grows
  • Robust investment spending and high energy costs have put upward pressure on the current account The
  • strength of domestic demand growth suggests little scope for a significant improvement in the external position
  • in 2007-2009
  • Table: Current Account
• Chapter 3: Special Report
  • BMI Sovereign Risk Ratings
  • Table: BMI Sovereign RIsk Ratings
  • Emerging Europe
  • Table: Emerging Europe Sovereign Ratings - Evolution of Ability to Pay
  • Table: Emerging Europe Sovereign Ratings - Evolution of Willingness to Pay
• Chapter 4: Business Environment
  • SWOT Analysis
  • Legal Issues
  • Labour Force
  • Table: Demographic Indicators
  • Table: Employment Indicators
  • Foreign Investment Policy
  • Table: Lithuania, Annual FDI Inflows
  • Table: Emerging Europe, Annual FDI Inflows
  • Foreign Trade Regime
  • Tax Regime
  • Table: Top Export Destinations, US$mn
• Chapter 5: Key Sectors
  • Telecommunications
  • Table: Lithuania Telecoms Sector Mobile Historical Data & Forecasts
  • We now forecast that the active mobile subscriber base in Lithuania will grow by around 7% in 2006, raising
  • penetration to just over 135% Growth rates should slow but the entry of new operators as well as greater take-up
  • of 3G services and continued trend of multiple SIM ownership should combine to raise penetration in excess of
  • 150% in 2009
  • Table - Key Players: Lithuania Telecoms Sector