Download In 2002 the economic and social development in Lithuania was

REVIEW OF BALTIC STATES REAL ESTATE MARKET 2002
In 2002 the economic and social development in Lithuania was tightly related to the
preparation to the European Union accession and the process of versatile integration
as well as peculiarities of the national economic development typical to the period of
recent years. Economy experts (source: Vilnius Bank) name the period of 2000-2003
as “a development phase of a running-up economy”, which follows an initial
transition period to the market economy, development of market infrastructure and
economic decline due to the Russian financial crises. Years of 2000-2003 are
characterized as a period when state institutions and business entities, which have
gained experience over previous years, are more ready for further development of
economy and competition in newly opening markets. Experts describe this period as
the overgrowing from the quantitative changes into the qualitative ones.
Gross domestic product (GDP) in 2002 increased by 6.7 % and reached 14.648
milliard EUR. Preliminary data evidence that GDP for one citizen was 4230 EUR.
This pace of development has beaten all early prognoses. It is expected that similar
level will remain during the nearest years.
Inflation in 2002 was reducing further and reached a limit of -1%.
Despite of stable growth of economy the rate of unemployment remained rather high
and was 11.3%. The highest rate of unemployment was in rural regions where, if
compared to the major Lithuanian cities, the development of business is slower as
well as the establishment of new working places.
In 2002, the number of granted loans was further increasing while the interest rate
was falling down. Average annual interest rate was 6.6%. In 2002 the development of
real property market was significantly affected by the increase in number of favorable
housing loans. Growing average salary and financial capacity was also a precondition
for the major part of citizens to take loans for housing. These conditions made a great
influence on the activity of apartments market, mainly in major cities.
Sources:
Bank of Lithuania; Statistics Department