Kubilius has attended each investment forum Vilnius has held this year, touting the country's credentials to foreign investors and highlighting his government's commitment to making the country attractive for investment. Photo by Nathan Greenhalgh.

VILNIUS — Prime Minister Andrius Kubilius said he sees foreign investment as the crux of Lithuania’s economic recovery during a speech at Investors’ Forum held in Vilnius today.

“Ten years ago I made a simple statement about how I see the role of the government and business and investors. I said in a simple way that the economy would recover — at that time it was after the Russian crisis — I can repeat the same thing ten years after. Recovery is a real possibility,” Kubilius said, comparing the current situation to the Russian ruble crisis 11 years ago.

The prime minister said that the government needs to do its best to attract investors because they will help the country out of what is one of Europe’s worst recessions.

“But looking to where we are now, with the issues and challenges, we need to take care of the Lithuanian identity,” he said. “Lithuania needs to be the most attractive country for investors, not for the Baltic region, but for the whole region.”

Kubilius said that public-private partnerships would be the way forward for Lithuania and foreign investors.

“If Lithuania would take such a private initiative to make the country that it is the most attractive for foreign investors, we could achieve good results,” the prime minister said.

According to the Lithuanian Department of Statistics, foreign direct investment through the second quarter is down only seven percent from the second quarter of 2008, far less than Lithuania’s gross domestic product drop. Meanwhile the country’s declining wages and real estate values are already attracting certain kinds of investors.

Also at the conference Nerijus Udrėnas, the president’s top economic adviser said Lithuania is one of the most flexible countries in Eastern Europe, but that the national economy needed to stabilize before people would invest.

“Stability can only be ensured by ensuring public finance – then other investors will invest,” Udrėnas said.

When asked by the chairman of the board of the Investors’ Forum Rolandas Valiūnas about how he saw that Lithuania has hit rock bottom and is recovering, Kubilius echoed what European Commissioner Günter Verheugen said two weeks ago.

“We need to trust what statistics say, not what the press says. We had a sharp decline during the last quarter of last year and start of this year. The data shows the exports and other important numbers, starting from May, June, July and August, there is some clear shape of stabilization. The recession was very deep, but what we see in the major economies of Europe, we see here,” Kubilius said. “When we look at what number we are stabilizing at, it seems the Baltics has the deepest recession, but that we are all stabilizing.”