The national economy has as yet survived the pandemic far better than expected

Date

2020 08 09

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The most recent national economic indicators show that by now we have managed to survive the pandemic much better than expected. Payments under the Economy Promotion Plan continue and with some measures completed others are being launched.

Economic situation

The Government is watching the number and tendencies of enterprise bankruptcy: compared to the previous year, the number of enterprises with registered legal status of bankruptcy has dropped by more than half  compared with 2019 (361 enterprise in 2020, 728 enterprises in 2019).

According to the data of Statistics Lithuania, Lithuania’s gross domestic product declined by 3.7 per cent in the second quarter compared to the same period of last year, and by approximately 5 per cent compared to the first quarter.

‘The Lithuanian economy has as yet survived the pandemic much better than expected. Rapid mobilisation of national economic rescue measures has also contributed to this, but it is still important to ensure the resilience of the country’s economy to the new possible wave of coronavirus, so that the economy does not have to be drastically blocked. This requires understanding and concentration of all of us,’ – says First Deputy Chancellor of the Government Lukas Savickas.

Monitoring the implementation of the Economy Promotion Plan

Out of the additional EUR 4.9 billion available for measures under the Economy Promotion Plan, almost one fifth of the budget – 17.5 %, or EUR 863 million has now been used. The funds continue to be used evenly: the last week, EUR 44.8 million was used. On average per week, spending continues to grow by around 1 percentage point.

Compared to the last week, payments for the preservation of jobs and residents’ income increased by almost 3 times: more than EUR 26 million were paid out in the last week of July. This growth was driven by a significant (more than 5 times) increase in the amount of payments to self-employed persons. From the total EUR 1 billion 893 million almost EUR 436 million (23 %) has already been used.

The Government continues to seek to help business and preserve its liquidity. There is also a steady increase in the use of funds. Out of EUR 1 billion 200 million available for preserving business liquidity, more than EUR 336 million (28 %) was used on 31 July and EUR 16 million — last week.

According to INVEGA data of 31 July, more than EUR 15 million have already been paid for the rent compensation by the end of July. The amount of subsidies for small enterprises is still growing slowly, with more than EUR 90 million already paid out of EUR 100 million allocated to the measure to date.

In the last week of July, the amount of not recovered tax arrears increased rapidly (+ EUR 73 million): it currently makes almost EUR 700 million and is the largest since 16 March. The number of natural, legal persons from which arrears in payments are not recovered is currently more than 63 thousand.

It should be noted that from 15 July applications for direct loans to tourism service providers affected by the pandemic began. The applications received are currently being evaluated; their number corresponds to EUR 18 million; in total, EUR 30 million has been allocated to the measure.

 

The data on the implementation of the economy stimulus package is available on https://koronastop.lrv.lt/lt/pagalba-verslui. The information is updated on regular basis.

The most important information about the cornovirus is available at http://koronastop.lrv.lt/en/.