Foreign Trade

The Ministry of Economy continued to improve the legal framework regulating foreign trade, adjusting it to the provisions of EU legislation while preparing to implement the provisions of the EU regulations and to carry out obligations to the World Trade Organisation. Under projects drafted by the Ministry and on the motion of the Ministry the Government passed a resolution in 2003 that changed the procedure of import and export regulation in the country, the resolution on the readiness to apply EU quotas and suspending customs duties and approved by its resolution the plan of actions simplifying provision of public services for 2004-2007. The plan established among other things measures related to foreign trade.

In order to liberalise the procedure of import, transit and export control of strategic goods the Law on Control of Export, Import and Transit of Strategic Goods was drafted and approved on 5 July 2002 along with the government-approved resolution concerning approval of the procedure of licensing export, import and transit of strategic goods.

In accordance with the data of Statistics Lithuania the turnover of foreign trade increased 7.3 per cent in 2003 as compared with 2002; exports increased 9.1 per cent while imports went up 6 per cent. Foreign trade balance was negative and, in comparison, decreased 1.8 per cent.

The most important Lithuanian foreign trade partners within the general trade system were the following countries: Russia (export amounted to 10.1 per cent of total export, while import stood at 18 per cent of total import), Germany (9.9 per cent and 17.9 per cent respectively), Latvia (9.7 per cent and 3.8 per cent), Switzerland (11.7 per cent and 1.1 per cent), Poland (3.4 per cent and 6.7 per cent). The breakdown of Lithuanian export by country groups is shown in Figure 16 .

Figure 16

Lithuanian Export by Country Groups, billion litas

The share of general Lithuanian commodity export to the EU and accession countries amounted to 61.4 per cent and for EFTA countries was 14.1 per cent during the analysed period (the value of exported goods increased nearly 3.7 times).

Seventeen types of goods originating in Lithuania worth 790.8 million litas were exported in 2003 amounting to 80.3 per cent of the total value of Lithuanian exports. Most of those goods were exported to markets of countries, which have high requirements (Table 3) : EU and accession countries (65.6 per cent.) and EFTA countries (17.1 per cent). The share of CIS exports was 9.3 per cent. The export of vegetable products, furniture, machinery and electric equipment, tools and devices and chemical industry goods was the fastest to move up the export scale.

Table 3

Changes in Exports of Commodities Originating in Lithuania by Country Groups (in 2003 as compared to 2002)

The ongoing EU enlargement process is related to tightening competition. Stronger competition as well as the slow-down of economic growth that has been recently observed in the euro zone reduced the ability of producers to increase their export volumes.

The slump in prices of exported products also has had adverse effects on the value of the total export of goods originating in Lithuania . Some producers were forced to cut back their exports due to the fall of the US dollar.