Lithuania's Economy Accelerates in Q3 2007

Lithuania's economy seems to have accelerated in the third quarter, expanding by 10.8 per cent according to a preliminary estimate from Statistics Lithuania. This is the fastest pace in four years, and the fact that the economy is gaining speed rather than slowing down must increase concern that Lithuania's economy may also be in danger of having a hard landing.

Statistics Lithuania informs that based on available statistical data and econometric models, estimated GDP for 3 quarters of 2007 totalled LTL 69946.9 million at current prices and as compared to 3 quarters of 2006 grew by 9.1 per cent (estimated using a chain-linking method in volumes of value added).

This year, the increase in the gross value added (GVA) was conditioned by the value added created by enterprises engaging in agricultural, construction, wholesale and retail trade, real estate, renting and other business, as well as transport, storage and communication activities. In III quarter 2007, GDP reached LTL 26473.5 million at current prices and, as compared to III quarter 2006, increased by 10.8 per cent. In the third, as in the second, quarter, the increase in GVA was conditioned by construction, wholesale and retail trade, transport, storage and communication, real estate, renting and other business, as well as manufacturing and agricultural activities. Value added created by agriculture reached the level of 2005 (in III quarter 2006, a 22.8 per cent decrease in value added was recorded).