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Chinese connection in Lithuania – still negligible

Investicijos iš Kinijos
„Reuters“/„Scanpix“ nuotr. / Chinese investors still have little interest in Lithuania.
Šaltinis: 15min

Both Lithuanian Prime Minister Andrius Kubilius and President Dalia Grybauskaitė have invited the Chinese to come to Lithuania – however, unsuccessfully. In the list of Lithuania's top foreign investors, the Asian giant is only number 42.

According to “Invest in Lithuania” data, there are no significant Chinese investments in Lithuania. Statistics shows that the sum of total investment by one of the world's leading economies in Lithuania is negligible – merely 12 million litas (EUR 3.48 m), and that including money from Hong Kong (LTL 3.4 m, EUR 1 m).

The bulk of Chinese investment in Lithuania goes into accommodation and catering services (LTL 3.9 m), manufacturing (LTL 3.3 m), and buying and selling private real estate (LTL 1.7 m).

Among more significant enterprises are Chinese Huawei Technologies' contracts with Vilnius University and Lithuania's Omnitel on the joint project of MTEP lab in Vilnius.

If we want China to take interest in us, we need something exceptional.

Chinese share of foreign investment would have been much greater, had Martynas Laivys, owner of the recently bankrupt Star1 Airlines and travel agency Star Holidays, managed to find a strategic investor back in late 2010.

At the time, he claimed to hold talks with Chinese company HNA Group that owns 13 airlines, 420 aircrafts, 12 airports, 100 supermarkets, 50 hotels, 30 travel agencies, and assets worth 17 billion euro. The negotiations did not go through, though – the Chinese were deterred by debts of Laivys' companies that amounted to 15 million litas.

Tiny and dull

According to Vilija Tauraitė, SEB bank's chief analyst, Lithuania is a very small market and therefore has never been and is unlikely to be among China's key foreign partners.

“If we want China to take interest in us, we need something exceptional. We might not always attract them with our lasers, that are indeed our big distinction. But let's not forget that China has a close neighbour, Japan, that produces much high technology and is well known for it,” the analyst said, adding she did not believe that Chinese investment in Lithuania would grow very much.

Nor is there any significant trade link between Lithuania and China. Even though this country produces many cheap and competitive goods that have flooded our stores and supermarkets in the past decades, they make up meager 2 percent of Lithuania's total imports, with annual growth remaining low.

“On the other hand, if we turned to exports, there is significant interest from businessmen. Again, the share is tiny, 0.3 percent of Lithuania's total exports, but it represent two-fold increase. Such starting position quite modest, but, bearing in mind that Chinese economy is among world's largest, Lithuanians will certainly become increasingly attracted towards it,” Ms Tauraitė said.

In her view, Lithuania might only interest China as a transit country: “Especially since we have a new communication line, the “Saulė” train, and Lithuania could become a bridge between China and Western Europe. But, bearing in mind China's size, Lithuania is unlikely to be an important object of interest for the Chinese, we're simply too small a country, very small market.”

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