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EC cuts growth forecast for Lithuania

Staff writer ▼ | November 6, 2014
The European Commission (EC) cut its growth forecast for Lithuania to 2.7. The EC said Russian sanctions were expected to crimp exports and dampen consumer and investor sentiment in the Baltic country.
Growth this year   Russian sanctions were expected to crimp exports
In 2014, Lithuania's exports received a setback due to the ban imposed by Russia on agricultural and food products coming from the EU, the EC said in its autumn forecast.

In 2015 and 2016, however, Lithuanian exports are set to recover.

"This correction is not significant enough to call it somewhat very disappointing," Nerijus Maciulis, Swedbank's chief economist in Vilnius, was quoted as saying by local website VZ.LT.

According to Maciulis, the increase of Lithuania's budget deficit foreseen by the EC should be valued as a more worrying indicator, due to the risk of breaching the EU's fiscal rules.

Unemployment in Lithuania is estimated to decline, from 11.2 percent in 2014 to 10.4 percent in 2015 and 9.5 percent in 2016. Inflation will stand at 0.3 percent this year and 1.3 percent in 2015, according to the forecast.