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Lithuania
BY: DANIEL GHOSSEIN
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Map & Flag

https://commons.wikimedia.org/wiki/File:Flag-map_of_Lithuania.svg
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About Lithuania

 Lithuania is a country in Northern Europe.

 Situated on the southeastern shore of the Baltic Sea, it shares a border with Latvia, Belarus,
Poland, and the Russian enclave of Kaliningrad.
 Capital City: Vilnius (+2 GMT)
 Major Languages: Lithuanian (official) 82%, Russian 8%, Polish 5.6%, other 0.9%,
unspecified 3.5%
 Primary Religions: Roman Catholic 77.2%, Russian Orthodox 4.1%, Old Believer 0.8%,
Evangelical Lutheran 0.6%, Evangelical Reformist 0.2%, other (including Sunni Muslim,
Jewish, Greek Catholic, and Karaite) 0.8%, none 6.1%, unspecified 10.1%.
 Calling Code: 370

https://globaledge.msu.edu/countries/Lithuania/memo
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People

 Population: 2,828,403 (2017)

https://globaledge.msu.edu/countries/lithuania
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Geography & Environment

Total Area 65,300 sq. km

Land Area 62,680 sq. km

Water Area 2,620 sq. km

Coastline 90 km

Climate Transitional, between maritime and

continental; wet, moderate winters and
summers

Terrain Lowland, many scattered small lakes, fertile

soil

Lowest Point Baltic Sea 0 m

Highest Point Juozapines Kalnas 294 m

https://globaledge.msu.edu/countries/lithuania
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Strengths

 Member of the Eurozone since 2015 and the OECD since May 2018.
 Sound public and external accounts.
 Banking system dominated by three Scandinavian institutions
 Transit zone between the EU and Russia/Kaliningrad enclave
 Diversification of energy supply (Klaipeda gas terminal, shale gas potential, electricity
links with Poland and Sweden)

https://globaledge.msu.edu/countries/lithuania/memo
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Weaknesses

 Tight labor market: shrinking workforce (emigration of skilled young people) and high
structural unemployment.
 Large underground economy (26% of GDP).
 Wide income disparity between the capital and the regions – particularly in the northeast,
where poverty persists.
 Limited value added of exports (mineral products, timber, agri-food, furniture, electrical
equipment).
 Competitiveness eroded by insufficient productivity gains.

https://globaledge.msu.edu/countries/lithuania/memo
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Cultural Factors

Cultural Taboos:
 Lithuanians do not really have Taboos about subjects of conversation that should be avoided; except
that you should show respect and avoid open criticism of Lithuania or its people.

 There are a number of behaviours that are not acceptable in Lithuania. The consumption of alcohol in
parks, squares and other public places is prohibited by law along with smoking in cafes, restaurants,
halls and on public transport, except in specially marked smoking areas, and littering from car
windows or in public places. Fines can be quite expensive and these offences are taken seriously.

 Avoid kissing, when greeting a person that you do not know well, a handshake is far more common
and appropriate. Usually only relatives or close friends kiss when meeting.

https://businessculture.org/eastern-europe/lithuania/
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Cultural Factors

Business Communication:
 Lithuanians are respectful with a conservative demeanour. They are formal and tend not to use many
physical gestures. Usually, men and women do not touch whilst talking, although patting on the shoulder
might be observed. It is recommended not to point with a single finger, but to use the whole hand with the
palm facing up.

 Eye contact is crucial and Lithuanian business people prefer to look into the eyes of their partners while
discussing business opportunities. Maintaining good eye contact is a sign of respect and demonstrates how
seriously someone is taking the subject of discussion.

 Lithuanians are usually conservative in their manners and the way they communicate; they are direct and
say what they mean politely.

https://businessculture.org/eastern-europe/lithuania/business-communication/
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Cultural Factors

 Man greeting Man - Men shake hands when greeting one another. A firm handshake is the norm.
Good friends and family may engage in light hugs.

 Woman greeting Woman - At a first meeting, women generally shake hands. Many times a simple
nod of acknowledgment will suffice. Good friends may engage in hugs or exchange kisses on the
cheek.

 Man greeting Woman - At a first meeting a regular handshake will do. Many times a simple nod of
acknowledgment will suffice. Good friends may engage in hugs or exchange kisses on the cheek.

http://guide.culturecrossing.net/basics_business_student_details.php?Id=7&CID=119
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Cultural Factors

Business Relationships:
 Like in other Baltic states, it is very important to have a personal contact in the
destination country. Lithuania is more product-orientated, which means that if you have a
good product, they would be willing to do business with you.

 A Lithuanian businessman will be more comfortable in engaging in business with you, if

you have been introduced to him by someone he knows and trusts.

https://businessculture.org/eastern-europe/lithuania/business-communication/
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Cultural Factors

 You should dedicate time and effort in fostering relationships through informal meetings
and continuing communication.
 Lithuanians prefer to have all agreements on paper, signed and sealed. Verbal agreements
are good, but not legally binding.
Personal Titles:
 It is advisable to use the information on their business card to determine how to address
an associate. So, if he or she has a title written in front of their name, then you should
address the person by their title and surname.

https://businessculture.org/eastern-europe/lithuania/business-communication/
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Cultural Factors

Negotiations:
 Decisions tend to be made from the top down.
 Avoid hard selling tactics and any sort of conflict or confrontation

http://guide.culturecrossing.net/basics_business_student_details.php?Id=22&CID=119
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Political System

 The government system is a parliamentary democracy;

 The chief of state is the president,
 The head of government is the prime minister.
 Lithuania has transitioned from a command economy to a market economy in which the
private sector accounts for the majority of GDP, and government regulation is transparent
and efficient.

https://globaledge.msu.edu/countries/lithuania/memo
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Country Risk

 Country rating: A3
 Changes in generally good but somewhat volatile political and economic environment
canaffect corporate payment behavior.
 A basically secure business environment can nonetheless give rise to occasional
difficulties for companies.
 Corporate default probability is quite acceptable on average

https://globaledge.msu.edu/countries/lithuania/memo
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Legal System / Corruption Index

 The Republic of Lithuania (Lietuvos Respublika) is an independent democratic state.

 The foundation of the social system is enforced by the Constitution of the Republic of
Lithuania, adopted in 1992 by referendum, which also establishes the rights, freedoms,
and duties of citizens.
 Under that law, sovereign state power is vested in the people of Lithuania and is
exercised by the Seimas (Parliament), the President of the Republic, the Government,
and the Courts.

https://www.nyulawglobal.org/globalex/Lithuania.html
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Legal System = Civil Law

 In 2001, the new Civil Code came into effect. During recent years other important codes
(Code of Civil Procedure, Criminal Code, Code of Criminal Procedure, Code of the
Execution of Penalties, Labour Code) were newly re-enacted by the Parliament, and
entered in force in 2003.
 Moreover, the Lithuanian laws have been harmonised with the acquis
communautaire of the EU in order to become a member state as of 1 May 2004.
 Corruption Perceptions index score: 59

https://www.nyulawglobal.org/globalex/Lithuania.html
https://globaledge.msu.edu/countries/lithuania/indices
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Economic System

https://globaledge.msu.edu/countries/lithuania/economy
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Economic System

https://globaledge.msu.edu/countries/lithuania/economy
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Economic System

https://globaledge.msu.edu/countries/lithuania/economy
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Economic System

https://globaledge.msu.edu/countries/lithuania/economy
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Economic Rankings

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Economic System

https://globaledge.msu.edu/countries/lithuania/economy
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Economic System

 Income Level: High Income

 Level of development: Developed
 Economic Trivia: The government offers special incentives for investments in the high-
technology sectors and high value-added products.
 Trade:
Top 3 Trade Partners (2017): Russia, Germany, and Poland
Top 3 Exported Goods (2017): Oil & Mineral Fuels, Industrial Machinery, and Furniture
 Top Industries : Metal-Cutting Machine Tools; Electric Motors; Television Sets;
Refrigerators and Freezers

https://globaledge.msu.edu/countries/lithuania/economy
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Economic System

https://globaledge.msu.edu/mpi/data/2017
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Business Rating

 Business Climate rating: A2

 The business environment is good. When available, corporate financial information is
reliable.
 Debt collection is reasonably efficient. Institutions generally perform efficiently.
 Intercompany transactions usually run smoothly in the relatively stable environment

https://globaledge.msu.edu/countries/lithuania/memo
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Ease of Doing Business
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Business Idea

 A good business idea would be a franchise of “Ariodante Tourism” service in Lithuania.

 Ariodante creates personalised experiences for its clients, in the European and
Mediterranean cities they want to visit.
 Ariodante boast a strong presence everywhere in Europe, which allows to keep creating
new experiences for clients.
 An opportunity to join a very high growth potential franchise, dedicated to luxury, culture
and travel. This franchise will allow to mix business with pleasure, while being part of a
growing network for a small investment.

https://www.franchiseeurope.com/travel-leisure/ariodante/
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Business Idea

 Lithuania experiences a constant increase of foreign visitors.

 In 2017, the accommodation establishments of Lithuania received 3.25 million tourists,
which is by 6.2 per cent more than in 2016.
 Lithuania attracts foreign visitors mostly from Germany, Poland, Russia, Latvia, Belarus,
the United Kingdom, Estonia and Finland.

https://en.wikipedia.org/wiki/Tourism_in_Lithuania
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Business Idea

Strengths of Lithuania:
 Favourable geographical position, the ice-free seaport;
 Strategically important transport corridors;
 Recreational resources (lakes, rivers, forests, coast);
 Rich cultural and historical resources;
 Low-urbanized rural landscape;
 The UNESCO World Heritage listed six Lithuanian tourism resources and facilities;
 Unique coastal area in Europe;
 Historical and cultural ties with foreign countries;
 Water parks in the region;
 Developed inland (kayaks, canoes) tourism;
 There are numerous pilgrimage tourism infrastructure

https://www.jois.eu/files/GrundeyV_5_N1.pdf
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Business Idea

Weaknesses of Lithuania:
 Lack of public tourism infrastructure;
 Lack of cultural heritage for tourism and public needs;
 Lack of leisure activities diversity;
 There is no universal and global reservation system for tourist services.

https://www.jois.eu/files/GrundeyV_5_N1.pdf
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Business Idea

Different forms of Tourism in Lithuania:

 Historical
 Cultural; (museums, concerts, theaters)
 Natural
 Religious
 Thermal
 Beach
 Outdoor Activities
 Shopping

https://www.nordeatrade.com/en/explore-new-market/lithuania/travel-tourism