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Lithuanian authorities deny country's vulnerability to Brexit

Xinhua, July 14, 2016 Adjust font size:

Lithuanian finance ministry criticized on Wednesday the report from credit agency S&P and called its conclusions about Brexit effects on the Baltic state inaccurate.

According to Lithuanian finance ministry, S&P's analysis which named Lithuania as the most vulnerable Eastern European country to Brexit contains illogic conclusions and inaccurate data.

Lithuanian deputy finance minister Algimantas Rimkunas noted that many assumptions in the analysis are false, and Lithuanian economy is not dependant on the UK economy as much as S&P's analysis claims.

"The currently anticipated effects and risks are minimal, and we currently don't feel direct effects," Rimkunas told a press conference.

He pointed out that remittances from Lithuanian migrants working in the UK are not to decrease at a scale as the agency forecasts. According to S&P, 5.4 percent of Lithuanian population currently lives in the UK, and their remittances to the Baltic state account to 1.2 percent of Lithuania's GDP.

"In 2014, residents' remittances from the UK amounted to 213.5 million euros, or 0.6 percent of GDP, according to the data from the Bank of Lithuania," announced the finance ministry in its press release.

The finance ministry claims that Lithuanians, living in the UK, account to 5.1 percent of the total Lithuanian population. The ministry also disagrees with the agency's forecast on the possible decrease of EU funds to Lithuania.

The direct "effects on Lithuania's exports to the UK would be small," and the motives putting Lithuania among the most exposed countries in terms of trade links "raises doubts," added the ministry.

"Many analysts agree that Ireland, the Netherlands, Belgium, Malta, Cyprus and Luxembourg would feel the biggest negative consequences of Brexit," said Lithuanian finance ministry in the press release.

In a Brexit heat map announced on June 30, S&P suggests that Lithuania, Latvia, Hungary and Poland would be the most exposed Central and Eastern European countries in the UK leaving the EU, given their large migrant populations, remittances, trade links and the importance of EU funds to finance investment. Endit