Vice-President of the European Commission Olli Rehn
Vilnius - XINHUA
Joining the euro zone has helped Lithuania further stabilize it's public finances, Patrick D'Souza, an official representing the European Commission's unit for economic affairs, said here on Wednesday.
"Lithuania managed to handle the situation since the start of financial crisis in 2009 and progressed further on, and this year it joined the euro zone, which marked a big step towards bigger financial sustainability," said D'Souza, deputy head of unit at the Commission's Directorate General for Economic and Financial Affairs.
D'Souza made these remarks at the international conference "Sustainability of public finances: challenges after euro adoption," held here at the Seimas, Lithuania's parliament.
According to D'Souza, the Commission's projections for Lithuania's public budget balance in 2015 are to be revised up next week when the commission announces it's updated economic outlook on May 5.
According to the commission's European Economic Forecast published in February, Lithuania's general government deficit was forecast at 1.4 percent of gross domestic product (GDP) this year, to compare with 1.2 percent recorded in 2014.
Meanwhile, the Ministry of Finance has prepared Lithuania's first ever stability program, an accountability report of euro area countries' implemented and planned budget policies. The program was approved by the government on Wednesday.
Based on the stability program, Lithuania's GDP growth is expected to grow consistently. The country's economy is projected to expand by 2.5 percent in 2015, by 3.2 percent in 2016, 3.5 percent in 2017 and 3.9 percent in 2018.
The general government deficit is forecast to amount to 1.2 percent of GDP in 2015, 1.1 percent next year, and fall to 0.2 percent in 2017. The ministry forecasts 0.1 percent of GDP budget surplus in 2018.
"Lithuania must guarantee the safe functioning of public finances and improve public welfare at the same time," Rimantas Sadzius, the country's Minister of Finance, was quoted as saying in a statement.
Public finances should be improved through better tax collection and more efficient public spending, he added.
"We have internal reserves, therefore, we do not suggest spending cuts in any area, while the current expenditures should become more effective," Sadzius noted.
The government intends to maintain economic stimulus measures, due to uncertainties of the economic environment, the Finance Ministry also said.