The bank expects the economy to expand by another 4 percent next year. In October, it predicted that Lithuania's GDP growth would accelerate to 4.5 percent in 2014.
"The global environment is becoming less tense, healthier. We predict that this climbing out (of the downturn) will continue this year. But we are going to see some recovery as soon as the second half this year," Nerijus Mačiulis, Swedbank's chief analyst, said on Wednesday while presenting the bank's latest global and Lithuanian economic forecasts.
The eurozone economy is forecast to contract by 0.3 percent next year, he said.
Swedbank's analysts did not change their estimate of 3.3 percent GDP growth in Lithuania in 2012.
No euro
Swedbank analysts also say that prospects of Lithuania joining the euro before 2017 are dim.
"The euro could be introduced in 2017 at the earliest. Certainly, this could be changed, but that would require taking very decisive measures," Mačiulis said.
The analyst thinks that average inflation in Lithuania will exceed the Maastricht criterion both this year and next year.
Lithuania's inflation forecast is 3 to 3.3 percent for 2013 and 3.4 percent for 2014.
The Maastricht inflation reference rate this year will stay at around 2.8 percent, Mačiulis said.
Drop in public debt
Analysts at Swedbank forecast that the Lithuania's public finance deficit will continue to narrow and that its public debt will begin to decline next year after reaching its peak in 2012.
Swedbank predicts that the general government deficit will narrow to 2.5 percent of GDP this year, from 3 percent in 2012, and will decline further to 2 percent in 2014.
"Inflation will remain the only obstacle (to Lithuania's euro entry)," Mačiulis said.
In line with the Fiscal Discipline Law, budget spending in 2014 could increase by around 200 million litas (EUR 58 mln), he said.
Lithuania's general government debt is forecast to decline to 38.4 percent of GDP this year after peaking at 40.9 percent last year and to fall further to 36.7 percent next year.
Ease in emigration
The problem of emigration from Lithuania is easing, the Swedbank says.
"Net emigration is approaching its lowest level since 2003," Mačiulis assured.
The analyst said that more than 40,000 people left Lithuania last year, but over 20,000 returned. If these trends continue, the net emigration figure this year will fall to around 15,000, he said.
"We see very good dynamics. If immigration grows at a similar rate, then net emigration in the second half of this decade can be close to zero," the analyst said.
He noted that the inflow of money sent home by Lithuanians living and working abroad is on the decline as well. Emigrants' remittances last year fell to around 800 million litas (EUR 232m), accounting for less than 4 percent of GDP, down from some 1.2 billion litas, or 6 percent of GDP, in 2011.
