VILNIUS — The International Monetary Fund now predicts that the Lithuanian economy will grow by 2 percent this year.

Various institutions have forecast their predictions for country’s economy, but this is one of the most optimistic. Lithuania’s economy shrank 15 percent last year as the government choked the economy with harsh, but needed austerity measures. The IMF recently said that if the country wants to get into the eurozone by 2014, it would need to keep cutting.

The IMF believes that world demand, which is growing faster than domestic demand will lead to a strong export-based recovery. Already the IMF’s prediction looks possible given that Klaipėda port, where much of the country’s exports leave from, is experiencing record handling.

The Finance Ministry has been slightly less optimistic predicting 1.6 percent growth in gross domestic product. Lietuvos Bankas, the country’s central bank thinks the economy could grow by 0.5 percent given its better than expected first quarter results.

The IMF was congratulatory in 2009 of the government’s austerity measures, which included higher taxes and wage and labor cuts across all public institutions. Social benefits were also restricted as Cabinet sought to slash its burgeoning budget deficit.

This year the budget deficit should be around 8.1 percent according to the Finance Ministry.

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