Lithuania: country overview

26 June 2012
by Ina Dimireva -- last modified 26 June 2012

Despite Lithuania's EU accession, Lithuania's trade with its Central and Eastern European neighbors, and Russia in particular, accounts for a growing percentage of total trade. Privatization of the large, state-owned utilities is nearly complete. Foreign government and business support have helped in the transition from the old command economy to a market economy.

Lithuanian flag

Year of EU entry: 2004

Member of Schengen area:Yes

Political system: Republic

Capital city: Vilnius

Total area: 65 000 km²

Population: 3.5 million

Currency: litas

Listen to the official EU language: Lithuanian

Country overview

Lithuania is the southernmost of the three Baltic states – and the largest and most populous of them. Lithuania was the first occupied Soviet republic to break free from the Soviet Union and restore its sovereignty via the declaration of independence on 11 March 1990.

The Lithuanian landscape is predominantly flat, with a few low hills in the western uplands and eastern highlands. The highest point is Aukštasis at 294 metres. Lithuania has 758 rivers, more than 2 800 lakes and 99 km of the Baltic Sea coastline, which are mostly devoted to recreation and nature preservation. Forests cover just over 30% of the country.

Some 84% of the population are ethnic Lithuanians. The two largest minorities are Poles, who account for just over 6% of the population, and Russians, who make up just over 5%. The Lithuanian language belongs to the family of Indo-European languages.

The capital, Vilnius, is a picturesque city on the banks of the rivers Neris and Vilnia, and the architecture within the old part of the city is some of Eastern Europe's finest. Vilnius university, founded in 1579, is a renaissance style complex with countless inner courtyards, forming a city within the city.

The Lithuanian president is elected directly for a five-year term and is active principally in foreign and security policy. The unicameralLithuanian Parliament, the Seimas , has 141 members.

Economy overview

Lithuania's economy grew on average 8% per year for the four years prior to 2008 driven by exports and domestic demand. However, GDP plunged nearly 15% in 2009 - the three former Soviet Baltic republics were among the hardest hit by the 2008-09 financial crisis. In 2009, the government launched a high-profile campaign, led by Prime Minister KUBILIUS, to attract foreign investment and to develop export markets, and the government's steadfast commitment to broad economic reforms has been vital in Lithuania's quick recovery from a deep recession - GDP grew 1.3% in 2010 and jumped 5.8% in 2011, making Lithuania one of the fastest growing economies in the EU. However, unemployment - at 15.6% in 2011 - remains stubbornly high. Lithuania in 2011 also began to unbundle its energy networks in order to reduce its dependence on Russian energy.