Germany’s manufacturing output is expected to decline in November and remain only 3.7% above levels seen during the peak of the Covid-19 crisis, raising concerns for Lithuania’s closely linked industrial sector, the business daily Verslo žinios reports.
Citadele Bank economist Aleksandras Izgorodinas said that while Lithuania’s manufacturing output grew 4% in August, models forecast a much smaller increase of just 0.11% in November.
Germany is a major export market for Lithuania, accounting for about 12% of total exports of Lithuanian-origin goods, Izgorodinas said. But Germany’s influence on Lithuania is even greater indirectly, through supply chains.
Economist Eglė Stonkutė of the Lithuanian Confederation of Industrialists (LPK) noted that the slowdown in Germany’s manufacturing sector is already affecting Lithuanian producers.
Meanwhile, Indrė Genytė-Pikčienė, chief economist at Artea Bank, said analysts are concerned that “fundamental economic activities”, including manufacturing, are growing “very modestly” in Lithuania.
She added that hopes rest on the sector’s ability to “find new niches, reorganise, and develop new branches” to adapt to shifting market conditions.
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