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Roundup: Lithuanian industrialists urge gov't to tackle demographic, competition issues

Xinhua, April 19, 2016 Adjust font size:

Concerned about the country's dwindling population, competitiveness, and economic growth, Lithuanian industrialists put forward dozens of proposals at an annual meeting with the prime minister on Monday.

Meeting with Prime Minister Algirdas Butkevicius, the leaders of the Lithuanian confederation of industrialists highlighted that the country's business environment faced difficult problems.

The head of the confederation, Robertas Dargis, pointed to the fact that Lithuania's economic growth, which was among the fastest in the European Union at the beginning of 2015, had lost its position.

"In 2015, the development of the Lithuanian economy wasn't fast, GDP increased only by 1.6 percent, this is the worst score since 2010," Dargis was quoted as saying in a press release after the meeting.

Economic growth had been increasingly affected by structural problems, he said, citing red tape, stalled liberalization of labor regulation, business funding, flaws in the taxation system, and the quality of education.

According to the confederation, the worsening demographic trends are taking its toll on the country's businesses, making it hard for companies to find a qualified labor force.

"From 2012 to 2015, Lithuania lost 82,000 residents, half of those emigrating were of employable age," said the confederation, noting that Lithuanian companies had been creating jobs four times faster than hiring.

Industrial companies say the lack of labor force wage increases have negatively affected productivity. Last year, the real average gross wage in the private sector increased by 6.5 percent, four times faster than the country's GDP.

As a possible solution, industrialists urged the government to change its immigration policy to make it easier for Lithuanian companies to hire foreign specialists.

On Monday, the confederation presented the government with dozens of proposals to change taxation, labor market regulation, and energy, reported news website vz.lt.

Meanwhile, the prime minister insisted the government's efforts to modernize labor regulations were met positively by the industrialists. Butkevicius noted that the Lithuanian economy had been able to withstand geopolitical shocks to the country's economy, such as the food embargo from Russia, one of Lithuania's key trading partners.

Lithuanian economy minister Evaldas Gustas also met with the industrialists and promised in the near future it would become easier for the companies to bring in highly qualified foreign specialists from non-EU countries, after the new regulation is approved by the country's parliament.

"There's the whole list of measures to ease the arrival of specialists from third countries to Lithuania, the government has already approved the amendments of the law on the legal status of foreigners," Gustas told Lithuanian national radio LRT. Endit