President: Lithuania could face economic stagnation, which would be a significant blow Business
“According to the worse scenario, if not a recession, there may be an economic stagnation, which, if Lithuania is accustomed to sufficiently rapid growth, would be a considerable blow,” said the third head of the LRT.
According to him, the economic situation is changing rapidly and it also depends on uncertain assumptions as the course of the war in Ukraine.
According to the President, the current economic situation is serious, so quick solutions are needed to address it.
“This is a very serious situation and I would say that we are looking at a phenomenon that is called stagflation in the economic literature, when at the same time the rates of economic growth are rapidly declining and at the same time inflation is rising sharply,” said G. Nausėda.
“This situation is very unfavorable in the sense that it is very difficult to find antidotes and prescriptions to manage it, so I think we are already very concerned about what measures we will offer people to alleviate the effects of inflation,” he added.
He recalled that the measures proposed by the Presidency to make it easier for people to survive inflation were a one-off payment of EUR 100 for the population receiving the minimum pajamas and an increase in the tax-free income (NPD) from EUR 460 to EUR 510.
The government promises to present a revised draft budget and anti-inflation measures this year by Easter at the latest.
According to the Prime Minister Ingrida Šimonytė, additional expenses may be related to the increase of pensions, NPD or other benefits, which have been increasing since the beginning of this year.