It is good to do business in Lithuania; Swedish business survey

Lithuania is a great country to do business, the Swedish business community state in a survey done by the Swedish Trade Council in cooperation with the Embassy of Sweden in Lithuania. Over 30 per cent of all Swedish companies operating in Lithuania responded to the survey questions, and that is a great result, Mantas Zalatorius, the Vice President of Central and Eastern Europe of the Swedish Trade Council told the press on 23 August.

Respondents to the survey are experienced top executives mainly Lithuanian nationals and working in private enterprises with high monthly income relatively young, predominantly male. Respondents manage companies with common service focus in versatile industries. Nearly half of the companies are medium and large enterprises focused on the local market while expecting growth from exports.

According to the survey the quality of life in Lithuania is good and further improving; It is a good place to do business. Local market is still lucrative. The future expectations look even better. It is becoming easier to find reliable business partners and more investments are planned. Investments are expected to slightly increase; the interviewed Swedish business leaders said they are planning to invest 230 million Litas into the country this year.

Political influence on business is expected to weaken, although governmental impact on business is expected to remain quite strong. Traditional media function as communication platform, however lacks credibility.

According to Zalatorius that a fact that an overwhelming majority of respondents have not been directly exposed to corruption, but they assume that corruption mechanisms are widely used is very worth of attention. The perception of corruption is extremely high in Lithuania but when it comes to actual corruption the story is different. When asked ‘Have you been offered to pay a bribe or to use other corruption mechanisms to win a tender / a contract during the period of the last 3 years?’ only 15 per cent of respondents said yes. However, when asked ’Do you assume that your competitors won a tender / a contract because of corruption mechanisms involved? ‘some 46 per cent had responded positively. Undisclosed respondent commented; ‘The perception of corruption is bigger than the corruption itself. When a company loses a tender, it has to explain somehow, why it lost it and corruption usually becomes the best explanation.’ Another added that; ‘Corruption is also when my competitor wins a tender because he knows the guy who holds the tender. “La familia”? The most encouraging comment comes from another respondent ‘At least 9 out of 10 tenders in Lithuania are “clean”. If you bring the lowest price, you get the tender. It might be different in another sphere.’ Lack of transparency is expected to decrease but still remains an issue.

Regulatory framework is quite favourable, but followed only to some extent. However major improvements expected. Taxation system is reasonable and improving. Dispute settling mechanisms are not trusted to full extent and the payment terms are often not followed

It is easy to establish a company. Good salary and productivity ratio. Good availability of competent staff, lots of hard work but lack of initiative. Internet and mobile telephony infrastructure is excellent. Well developed road infrastructure, poor accessibility by air. Access to capital is rather difficult. Competition is strong. Nordic companies are very well perceived.

The optimism of the Swedish business in Lithuania was illustrated by the Swedish Minister of Foreign Affairs Carl Bildt, who wrote in his tweet on 3 September; ‘We find that Swedish business find business climate here in Lithuania to be very good. Sweden is largest foreign investor in the country.’