Lithuania's GDP contracted by 3.7 percent in the second quarter of 2020, compared to a year ago, a smaller dip than previously expected.
The country's quarterly GDP stood at 11.5 billion euros at current prices, having shrunk 5.1 percent from the previous quarter, Statistics Lithuania said on Thursday.
“The second-quarter contraction was mostly due to services. Manufacturing had the second-biggest impact and construction was third,” Jūratė Petrauskienė, the head of Statistics Lithuania, told reporters.
She said that the economic downturn caused by the coronavirus pandemic was not as deep as the 2008–2009 financial crisis, she said.
“If we analyse and compare the 2009 crisis to this year's, we can see that the 2009 crisis was much more severe, [with the DP dipping] 12.7 percent. We now see a [quarterly] contraction of 5.1 percent,” she said.
Lithuania's GDP totaled 22.5 billion euros over the first half of 2020, down by 0.6 percent compared with the same period in 2019.
“This is a contraction, too, but insignificant,” Petrauskienė noted.
The second-quarter GDP was mostly driven down by declines of 2 percent in wholesale and retail trade, transport and storage, accommodation and food, 1.01 percent in manufacturing, and 0.95 percent in professional, scientific and technical, administrative and service activities.
The contraction in the manufacturing sector was mostly due to declines in textiles, leather processing, and oil product and timber trade. The construction sector saw a decrease in the residential building segment, according to Petrauskienė.
The economy is coping very well with challenges induced by the coronavirus crisis, and the latest figures are a cause for cautious optimism, according to Finance Minister Vilius Šapoka.
“Despite a strong shock to the economy, we've been seeing growing economic activity already since May,” he said in a statement, adding that the government's fiscal measures – including income and business subsidies – helped soften the blow.
He warned, however, that it was too soon to tell whether the second half of the year would be as hopeful.
The recent spike in coronavirus cases and growing uncertainty over the future might negatively affect business and consumer expectations, according to Šapoka.