Message from Ambassadors

Talent and Connectivity
Driving Lithuania’s GDPand FDI GrowthGediminas Varvuolis
Ambassador of the Republic of Lithuania to JapanGediminas Varvuolis has been Lithuanian Ambassador to Japan since February 2018. He was previously
Ambassador to Belgium, also accredited to Luxembourg. Before ambassadorship in Belgium, Ambassador
Varvuolis was responsible for national and international security issues in Lithuanian Ministry of Foreign
Affairs, was also posted to Lithuanian Embassy in France and Lithuanian Permanent Representation to NATO.

Growing Economy

Connectivity

Lithuania has come a long way from its first heady days
as an independent state in 1990. 1st in the EU for GDP
growth since 2000, and with GDP growth of 3.4% in2018 and predicted growth of 2.8% in 2019, the country
successfully weathered the aftershocks of the financial
crisis of 2008 and has been increasing GDP year-on-year.
Now in the top 14 nations in the 2018 Ease of Businessrankings, Lithuania is justly taking its place as a regional
hub for foreign direct investment.

What has attracted so many big names to the small Balticnation? For the answer to this question you first need tolook to connectivity. Located at the heart of Europe, andas a convenient bridge between East and West, Lithuania
is an ideal gateway nation. It can offer companies directaccess to clients in the CEE, CIS and Western Europe.
Moreover, with average flight times of 2-3 hours to most
European destinations, and international airports in bothKaunas and Vilnius it is easily accessible for international
business.

Lithuania’s consistent GDP growth, its supportive
business environment, excellent connectivity to WesternEurope, the CEE, the CIS and Scandinavia, deep talentpool with the highest level of tertiary education in the EU,
and near 100% proficiency in English amongst young
professionals, makes it a fertile ground for foreigncompanies wishing to expand their operations. In 2015,
Lithuania introduced EURO. In 2018 Lithuania became amember of OECD, and this year we celebrate our 15thanniversary of EU and NATO membership.
From 2010 to 2018 alone, the Global Business Services(GBS) sector increased more than three-fold, from 25 toalmost 80 centers. Capital Vilnius was chosen for
expansion by Western Union, Nasdaq, some of
Scandinavia’s biggest banking names (SEB, Danske,DNB Nord), Moody’s, Dana Incorporated, and second
biggest city Kaunas by Centric, NKT, OAG and AL-KO
Tech and many others. In total, GBS offices in Vilnius andKaunas employ more than 17,000 professionals.

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2019.5The country also ranks 1st in the CEE for its roads, and it
offers direct rail links to Russia, Belarus, Latvia, Poland,Germany, Ukraine and Asia (incl. China). This rail
connectivity, meanwhile, is set to expand following theopening of the Rail Baltica which will run from Berlin toHelsinki via Kaunas. Then there is the ice-free Sea Port ofKlaipeda, which is the largest port in the Baltic States,
handling up to 65 million tons of cargo each year.
But the connectivity the country has to offer is not limited
to rail, road, air and sea. One of the global leaders ininternet speed and 4G coverage (OpenSignal 2018), thecountry can provide a global digital reach that is fast,
reliable and affordable: its fixed broadband prices are thelowest in the EU (European Commission Digital Agenda
Scoreboard 2016). In fact, Lithuania ranked 1st in 2016
for globally fulfilling business needs for ICT (IMO World
Competitiveness Yearbook 2016). This is partly why theGBS sector in particular has taken off.

FDI in Lithuania
1. Talented Workforce
Overall, FDI is led by Nordic investment. In 2010-2018
FDI projects from the Nordics (Sweden, Norway,Denmark and Finland) accounted for 29% of the total
number. Meanwhile, the US accounted for 14%, the UKfor 10%, while Germany – for 8% of the total number ofFDI projects. This weighting towards Scandinavian
investment is, of course, precipitated by geographicalproximity, but also by working culture and mindset. The
local workforce is multilingual, competent intechnological, ICT, engineering sciences, extremely
adaptable and quick to fit the needs of any incoming
company.
2. Fintech
Another reason the country has proven attractive is that its
government and local institutions have been very
proactive in enacting changes that improve the conditions
for FDI. Lithuania’s take on the emerging fintech industry
is a prime example of this. The Bank of Lithuania hasoverhauled the country’s financial regulatory frameworkso that it could guarantee the sector with the quickest
turnaround in the EU for financial license application.
The plan worked nicely, and Lithuania is now able toissue e-money and payments institution licenses 2-3

times faster than other European nations. And theselicenses are valid in the broader EU market comprising
512 million people and 23 million businesses, making
Lithuania the fastest gateway to Europe. As a result,
Lithuania’s fintech sector grew by astonishing 45% in2018. The progressive and transparent regulation of Bankof Lithuania, Lithuania’s emphasis on innovation,
introduction of new Startup Visa program has drawn theeyes of many global fintech companies, notably Revolut,
Google and Earthport.
3. R&D
Being a small nation with very limited natural resources,
our greatest asset is innovation-thirsty people. Therefore,
we focused our energies on creating the best conditions
for R&D and tech growth. On the industrial innovation
front, the country has a long tradition in cutting-edge
photonics. Lithuania’s Workshop of Photonics is working
alongside Corning Incorporated – whose Gorilla Class isfound in 4.5 billion smartphones worldwide – on newlaser glass technology. Meanwhile, in the HealthTechnology field, Lithuanian talent is delivering solutions
for such global names as Thermofisher, Teva, Moog andIntersurgical. Information and internet solutions is also a
growing field. The local startup community has attracted
more than $100 million in investment, and spawned suchinternational successes as Trafi, Vinted, TransferGo,
2019.543

CGtrader and Deeper. This attracted Uber, Wix andNasdaq to come and set up their global operations inLithuania.
4. Incentives for ManufacturingAnd finally, no picture of the country’s FDI sector would
be complete without mention of the country’s
manufacturing sector, which is mainly focused in its
regions. With corporate tax rates ranging from 0-15%,and 6 Free Economic Zones (FEZ) which offer a raft offinancial incentives, Lithuania also offers a costcompetitive solution for companies looking to expand ordevelop their manufacturing operations. The country’s
FEZ zones in particular are especially attractive: they
offer 0% corporate tax for the first 10 years, and a 50%
reduction for the subsequent 6 years, 0% tax on dividends
and 0% tax on real estate. Major Japanese success story in
Lithuania – Yazaki Group automotive component
manufacturing project – is also situated in FEZ inKlaipeda.

cooperate either through Embassy in Tokyo and/or FDI
promotion agency “Invest Lithuania”.
Embassy of the Republic of Lithuania
3-7-18 Moto-Azabu,
Minato-ku, Tokyo 106-0046
T: 03-3408-5091
F: 03-3408-5092
E: amb.jp@urm.lt
W: http://jp.mfa.lt/
Invest Lithuania
Upes str. 23, 08128 Vilnius, Lithuania
T: +370 5 262 7438

F: +370 5 212 0160

E: info@investlithuania.com
W: https://investlithuania.com/

5. Japanese FDIs in Lithuania
According to Statistics Lithuania, in 2016 there were 16
Japan-controlled companies in Lithuania, employing
1088 employees with a total turnover reaching EUR
112.36 million the same year. Lithuania welcomesJapanese FDIs in all sectors and is always ready toリトアニア大使館とJOI が覚書締結
2019年４月８日、リトアニア大使館はJOIと覚書を交わし、日本企業によるリトアニア向け直接投資促進を目的とした相互協力について合意しました。
リトアニアが重点をおくフィンテックなどのIT関連産業やスタートアップの誘致・育成政策、またLNGターミナル整備や発電所などエネルギー・インフラ開発計画など、今後、両機関で協力し、日本企業の皆さまにご紹介していきたいと存じます。
写真左からJOI中西理事長
バルブオリス駐日リトアニア大使

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