According to data from Q2 2020, foreign direct investment from Sweden to Lithuania reached 3.3 billion euro, which is 17.6% of all foreign investment into the country. The second-largest investor into Lithuania is Estonia (14.7%) and the third – the Netherlands (13.5%).
It has been calculated that in Lithuania, there are around 200 companies operating whose shareholders are from Sweden. However, the majority of Swedish capital companies are settled in Vilnius.
The main sectors they operate in are telecommunications, banking, manufacturing, retail and wholesale trade. These companies employ around 22 thousand citizens in the country.
These were the conclusions presented in the December 2020 study Swedish business and development prospects in Lithuania.
Swedish banks and telecommunications companies dominate
In the event where the study’s results were introduced, Jonė Šeštakauskaitė, director general of the Swedish Chamber of Trade in Lithuania, said that the main Swedish investors in Lithuania are banks (SEB and Swedbank) and telecommunications companies (Telia and Tele2).
Based on their available property in the country, as per data from Q2 2020, the two banks comprise 62.1% of the Lithuanian market. For comparison, Luminor holds 28% and Šiaulių Bankas – 8.4%.
Meanwhile, the two Swedish telecommunications companies hold 74.1% of the active SIM cards on the market. Bitė Lietuva holds a 23.7% market share.
“If we are to compare their turnover results for 2019, the telecommunications companies had a higher turnover than the banks,” J. Šeštakauskaitė noted.
The study indicates that in 2019, the combined turnover for Telia and Tele2 reached 640.2 million euro, while the banks – 476.3 million euro.
Not the most important trade partner
In 2019, Lithuania’s three main trade partners were Russia (imports – 14%, exports – 14.5%), Poland (imports – 7.9%, exports – 11.8%) and Germany (imports – 7.8%, exports – 11.7%).
Based on export indicators, Sweden holds sixth place (4.5%) on the list and seventh in terms of imports (3.7%).
“Neighbouring countries are probably historically and traditionally essential neighbouring markets. As per export indicators, Sweden holds the sixth place, while import – seventh.
My main question would be – is that it? Do we have any new trends and future opportunities in the post-Brexit and post-corona period? Are there any opportunities to increase those indicators?” J. Šeštakauskaitė questioned while introducing the study.
Settled in Vilnius and planning expansion
The CEO of the Swedish IT company Syno International Jokke Nurminen explained that he came to live in Lithuania due to his Lithuanian wife. While he founded the company in our country, fundamentally, he sees no difference where to work. Most importantly, there need to be convenient transport links to the Scandinavian countries, which are his company’s main markets.
The company’s main and largest office is settled in Vilnius and J. Nurminen is planning to continue expanding it.
“Vilnius has certain good features and we do not see the possibility to move our offices somewhere else. For us, the quality of our staff is of the essence and we can find good staff here, they truly care about their work,” he said.
Furthermore, J. Nurminen noted that since 2012 when the company was founded, service quality improved in Lithuania.
“I recall when we had to establish the company back then, it wasn’t very pleasant. It was very problematic, there was a great deal of bureaucracy. Now, most things are digitalised and this has made life far easier,” he said.
Nonetheless, J. Nurminen pointed to one key disadvantage.
“Vilnius has become so popular, especially among IT specialists. We have our main team in Vilnius and currently, there is a great struggle for them. This is the main disadvantage when looking at my company. But it’s great for the staff. At the moment, Lithuanian IT specialists have no reason at all to leave the country and go elsewhere in Europe. This is because when looking at everything, life is far better in Vilnius than elsewhere,” he said.
Nerijus Čereška, board member and business consulting partner at the Swedish Chamber of Commerce in Lithuania said, “We were thrilled to compile a thorough report about the Swedish Business presence in Lithuania, which was commissioned by the Embassy of Sweden. The study gives a clearer picture of SE capital companies in Lithuania, both by size and main sectors, confirming a longstanding and stable business relationship between our countries. We can gladly conclude that Sweden is still the biggest investor in Lithuania, as well as a very important trade partner.
Nonetheless, we see that there are still plenty of business opportunities where the Swedish-Lithuanian collaboration could be enhanced even more, e.g. within the areas of IT, energy, security and defence, life sciences, fintech, etc.
Therefore, I really believe that this study will serve as a “fact-pack”, also encourage Swedish companies to get to know Lithuania better and consider it as a market for their business growth.”