Swiss business school:
Lithuania shows the way

Lithuania is the most improved economy in new global competitiveness rankings, proving that austerity measures can pay dividends, according to a survey by Swiss business school IMD.

A protestor is arrested during a 2009 riot over austerity measures (Photo credit: Getty)
The unpopular policies taken by Lithuania to put its economy in order in 2008-9 were rewarded with a nine-point jump to 36th place out of 59 economies in the rankings.

The Swiss business school ranks economies in terms of competitiveness, after rating their success in managing their economic, business and human resources.
In early 2009, there were riots on the streets of Vilnius, the capital of Lithuania, as the government forced through severe economic sanctions. Local people were furious at tax hikes: “The government has long neglected the social needs of the people, pensioners and others,” Algirda Paleckis, leader of the Frontas radical left party, told Reuters.

But the measures worked. In the first quarter of this year, the Lithuanian economy grew by 3.9%, on the back of stronger domestic demand, rising exports and a jump in construction output. Other Baltic economies also improved, with Estonia rising two places to 31.

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