Lithuania’s economic growth remained strong at 3.6 percent last year as the employment rate was high and unemployment continued to decline, the European Commission said on Wednesday in a report on challenges faced by the economy.
The EU’s executive body forecasts that Lithuania’s economy will continue to expand this year and next year, but growth will decelerate to 2.7 percent and 2.4 percent, respectively. Lithuania kept its public finances in surplus in 2017 and 2018 and is expected to continue doing so this year. Public debt is expected to decrease, according to the report.
Strong wage growth continues to support consumption and drive economic growth, but an increasing labor shortage causes concern about the long-term sustainability of economic growth, the Commission said, pointing to the need for improving education and making innovation policy and public investment more efficient.
Overall, Lithuania has made limited progress in addressing the 2018 country-specific recommendations, it said.