Linas Jegelevicius for the BNN
According to Invest Lithuania, a non-profit organization set up by the Ministry of Economy to promote investments in the country, the past year of 2016 was «another record-breaking year» for foreign direct investments (FDI) in Lithuania.
«We attracted 36 FDI projects to Lithuania. These projects are set to create 3,716 jobs over the next three years. By comparison, 28 foreign capital companies decided to set up operations in Lithuania in 2015, creating 2,370 jobs,» Egidijus Jurgelionis, Invest Lithuania PR manager, told BNN.
Thence symbolically, the New Year has started off with a major arrival – Holland’s Macaw, an award-winning employer and digital solution provider, announced this week it has selected Vilnius as the site for its first office outside the Netherlands.
With the footprint in Vilnius, the Dutch plan to grow exponentially and recruit highly talented information technology specialists who will develop Microsoft and Sitecore-based solutions for international customers.
«Lithuania is attractive for us for its highly qualified specialists, geographical situation and cultural similarities to the Netherlands,» explained Macaw’s CEO, William van der Pijl in a statement. «After several successful projects together with partners from Lithuania by merging their teams and ours into one, we are convinced that our employee-centred culture will be appreciated in Lithuania. With an office in Vilnius, we will be able to grow successfully».
Macaw operates in the field of Digital Transformation, Customer Engagement, Employee Empowerment, Data Driven Business, Optimize Operations and Enable the Mobile Mind shift.
The company is active in Finance & Insurance, Services, Manufacturing, Trade & Retail, Education & Health and Industry for customers such as Deloitte, Heineken, Volkswagen, Reed Business, Perfetti van Melle and many others.
Macaw is believed will employ about 20 IT specialists in its Vilnius office. This number is expected to grow to more than 200 professionals of various levels of expertise within the next few years. Currently, the company has a team of 250 in the Netherlands.
«Our specialists work with Microsoft technologies like NET, Cortana Intelligence suite, Dynamics365, Azure, Xamarin, Office365, different frontend frameworks and Sitecore. Macaw in Lithuania will be an integral part of Macaw, sharing the same values and culture. The Vilnius office will work in blended teams with Dutch colleagues on the creation and development of digital solutions. So, we will bring challenging projects giving our specialists in Vilnius the opportunity to grow,» the Macaw CEO emphasised.
The fact that Macaw has been named best employer in the Netherlands four times speaks for itself, says Jurgelionis, of Invest Lithuania.
Mantas Katinas, the managing director of Invest Lithuania tasked with foreign investment promotion in Lithuania, notices that Lithuania’s IT cluster has now reached «maturity».
«Consequently, further growth is only possible by attracting projects that require particularly high competence. As a Platinum Partner of Sitecore and multiple Gold Partnerships of Microsoft, Macaw offers high end integrated business solutions. Together with its unique company culture, this company will indeed be very attractive for IT specialists,» Katinas inferred.
When deciding on where to invest, the Dutch company considered various cities in Central and Western Europe before selecting Vilnius, the Invest Lithuania head revealed.
Asked by BNN to opine on Macaw’s decision, Gediminas Gricius, a leading IT specialist at JSC IT Uostas, a Klaipeda-based IT solution company, pondered he was not sure from the information available to him whether the Dutch will be hiring software engineers or just wants to have customer service specialists at its Vilnius office.
«These are two completely different things, certainly. Some of the foreign high-tech companies have chosen Lithuania as their customer service centers,» he emphasised before adding, «On the whole, Lithuania remains an attractive IT country for investors because of its cheaper workforce. The IT sector salaries are at least twice lower here than in the West, but they are growing fastest in Lithuania».
Speaking of the last year, Katinas prides in achieving «a breakthrough» in attracting production investments to Lithuania.
«Some of the newcomers are worth special mentioning. The Danish window and door manufacturer Dovista set up a division in Marijampolė in southern Lithuania and is implementing perhaps the largest greenfield investment project in the country’s history; Ryanair is expanding its aircraft maintenance base in Kaunas; and in the near future we expect to announce the arrival of another large investor, which will enhance Lithuania’s reputation internationally. Investments into production operations are a key factor in driving the growth of the economy of Lithuania’s regions,» Katinas suggested.
The number of new jobs that will be created in the production sector as a result of these investments, he says, is 1,386, which is double the 2015 figure.
«And foreign investors already established in Lithuania will also be creating new positions as their operations expand significantly. 1,850 new jobs will be created in the shared services sector, with a further 480 jobs added by technology companies expanding their units in Lithuania,» he added.
Swedish capital companies were the biggest creators of jobs in Lithuania in 2016: over the next three years they plan to employ 1,340 specialists in Lithuania. German companies came second with 750 new jobs planned, whilst Danish and Finnish capital companies are set to create 300 new positions each.
In 2016, foreign direct investment projects were brought to Kaunas, Klaipėda, Panevėžys, Marijampolė, Kėdainiai and Vievis. In these cities, 99 per cent of the capital invested will be in long-term property. The largest number of jobs created over the next three years thanks to these investments will be in Kaunas (780 jobs) and Marijampolė (330 jobs).
When calculating the annual results of its operations, Invest Lithuania only includes investment totals and planned job creation for the first three years of these investment projects, Jurgelionis explained. Therefore, the total amount of investment made by companies that decided to establish in Lithuania last year, and the number of positions they create, could be substantially higher in the long run, he noticed.
«For example, the Danish company Dovista in Marijampolė, has long-term plans to employ more than 1,000 people and to become the largest manufacturing company in the Marijampolė region,» Jurgelionis said.
Invest Lithuania estimates that the projects attracted in 2016 will annually add 50 million euros to the country’s tax coffers when implemented.
Asked about possible big-name investors this year, E. Jurgelionis assured BNN that there are «some big international companies» Invest Lithuania works with, but their final decision whether to start business here will come a little longer.
«However, we are positive the trend will persist,» he expressed hope.
Meanwhile, Robertas Dargis, president of Lithuania’s Industrialists Confederation (LPK), believes that the Klaipėda Seaport and Klaipėda Free Economic Zone (KLEZ) can especially benefit from foreign investments, even though the port’s results primarily rely on the geopolitical situation.
«If we manage to tackle the structural business environment issues we’re facing, our attractiveness to foreign investors would increase. Lithuania can become an excellent transitional stop, especially for Scandinavian companies,» he said.
But the LPK emphasised that it is «urgent» to have investment coming not only to the capital city, Vilnius, but the regions, too.
«In that sense, the city of Panevėžys (in northeastern Lithuania) could be a great example,» Dargis noted.