During a courtesy meeting with a delegation from Partit Laburista, Malta Chamber...
Vilnius is the capital city of the country of Lithuania. It is also the largest city of the country and houses a population of 560,190 as of 2010. This increases to 850,324 if the Vilnius County is also accounted for. The city hosts the seat of the Vilnius city municipality, the Vilnius district municipality and the capital of the Vilnius County. It is the centre of Lithuania’s political, cultural and business life.
Vilnius is the capital to the largest country in the Baltic region- Lithuania. The city itself is located close to the geographical centre of the continent of Europe. Within the country, it is positioned in the south-eastern part, and is three hundred kilometers away from the Baltic sea and thirty five kilometers away from the country of Belarus that is due east of the city. The population in Vilnius is ever increasing, and it is predicted to reach a total of 675,000 or 695,000 by the year 2015. A little more than twenty per cent of the labor population of the country of Lithuania is concentrated in Vilnius and it has the lowest unemployment rate in the country, at 6.4 per cent.
Vilnius has been termed as the gate of the world to Lithuania. Its economic trends mirror this term, as the capital boasts of economic policies that are attractive to both domestic as well as international business. In terms of entrepreneurship, the Vilnius County also exceeds the national average of Lithuania. The county accounts as the host for around 17 per cent of the extractive industry and manufacturing production in the country.
Around 81 per cent of the value of production that is manufactured within the county fall within the city premises. The county itself accounts for around 38.9 per cent of Lithuania’s gross domestic product. The gross domestic product per capita in the county was calculated at LTL 45,000. This is 54.9 per cent greater than the national average of the country in the year 2007. Vilnius also has a better developed production as well as non production service sector than that of Lithuania on average. Around 71 per cent of the gross value added, or GVA, is generated, with the national average being 62.7 per cent. Industries and construction market sectors generate around 27.6 per cent of the GVA, with the national average counted at 32.8 per cent. In addition, agriculture, fishing and forestry also constitute a considerable market share, with 1.4 per cent of Vilnius County’s gross value added, and a national average of 4.5 per cent.
The service sector has been the most rapidly growing market in the Vilnius economy over the last decade. This market includes transportation, communication, healthcare, public administration, social work, real estate, personal and business services and financial and insurance. Currently, more than t2 per cent of the population is employed in the service sector market. The service sector has developed by leaps and bounds, and new services have steadily grown with it.
Industries and production and manufacturing markets also hold a large market value, and are important for the foreign direct investments in Vilnius and Lithuania as a whole. Vilnius attracts large foreign investments in these markets for its relatively low operational costs. The costs of rent, buildings, overhead, utilities as well as service are among the lowest figures recorded in Central and Eastern Europe. Vilnius also offers highly qualified and cheap labor forces. In addition, it boasts of a well developed warehousing and transport infrastructure. This allows easy and cost effective transportation of materials across the markets.
Today, Vilnius is responsible for producing around 15.1 per cent of the manufacturing output of Lithuania. Around 20 per cent of the 332,400 people in the labor force of Vilnius are employed by industries. The main manufacturing industries today in Vilnius are those of wearing apparel, dyeing and dressing of fur, printing, food products and beverages and publishing. The remaining 52.4 per cent of the industrial production that are sold are produced by other industries. Five out of twenty one major industries are exporting more than 70 per cent of their total production. These industries are textiles, leather articles, medical, precision and optical tools and recycling metal waste and scrap.
The foreign direct investments in Vilnius was counted as LTL 20,855.2 million in the year 2008, which was an increase of 28 per cent from the last year that was recorded at LTL 16,296.5 million. As of 2008, Vilnius is ranked first in Lithuania for foreign direct investment. the major investments in Vilnius county were from companies and businesses that are based in Sweden, Denmark, Germany, Russia, Estonia and Latvia. The Lithuanian government is committed to promoting foreign direct investments into Vilnius.
The city itself attracts more than half- nearly 62.1 per cent- of the total foreign direct investments that come into Lithuania. The largest shares in the foreign direct investment has been in the direction of the transport-storage-communication, financial intermediation, wholesale and retail trade sectors. A significant amount of multinational companies have made large investments in Vilnius in particular. These major companies include Shell, Coca Cola, PepsiCo, IBM, ABB, Philip Morris, DHL, Minolta, Hansabank Group, Olivetti, Motorola, Skandinasvska Enskilda Banken and Norddeutsche Landesbank Girozentrale.
The real interest rates on business loans available in Vilnius are favorable for long term investments. This is because the rate of return on new capital in Vilnius is higher than in the advanced economies. The banks in Lithuania are also expanding their products in offer, as well as increasing the average length of their loans.
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