There is a rather high probability that all types of foreign investments will decline in the Baltic countries. We can also expect some flight of foreign capital – mostly because of rapidly growing production costs. The latter will first affect all those investments which hoped to earn profits mainly on the cheapness of local production. At the same time we expect that inflow of foreign investment will continue, as production costs here are still lower than in most other EU countries (particularly compared with the EU15). This shift – away from very cheap products toward higher value-added production in investments – is welcomed as it follows and supports structural changes in the economy. In the near future the volume of actual investments is quite significantly influenced by economic policy decisions.

The hesitation of foreign investors could be diminished with well-balanced and adequate political choices. There is a probability, albeit very slight, that capital flow into the Baltic economies will halt if bad economic policies bring about a full scale economic crisis.

(Macro Outlook, The Baltic Region, Hansa bank, October 2007)

Lithuanian Economic Outlook BnB Nord, 2007, (Investment p. 39-43)