bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Sunday 25.09.2016 | Name days: Rauls, Rodrigo
LithuaniaLithuania

Lithuania vehemently refutes S&P report, possible Brexit aftermaths

FaceBook
Twitter
Draugiem
print
(+1 of 1)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU

Linas Jegelevicius for the BNN

While the world – and Lithuania- are in the guessing game what the aftermaths of Brexit will be for the world, Europe, UK itself and each member of the already one-member-less 27 member bloc, Standard & Poor’s, an American financial services company, knows it best.

According to S&P, Lithuania would be the most affected by Brexit among all Eastern European nations. Lithuania’s Ministry of Finance hastened to refute the international rating agency’s claim, saying it has «drawn misleading conclusions.»

An unexpected and unsubstantiated report

Lithuanian analysts that BNN spoke to for the article also were generally shrugging their shoulders in disbelief: «If you were to ask another similar company, you’d hear that Poland, Latvia or any other Eastern European country will be ill-affected most by it,» quipped Lauras Bielinis, a famous Lithuanian analyst.

Still, the S&P report has stirred some ripples across 11 Eastern European countries, Turkey and Russia- all of which were analysed by the Americans.

Responding, the Lithuanian Ministry of Finance, issued the statement: «In light of the global analytical forecasts, Lithuania would not be among the most exposed countries, if all EU member-states were rated. Many analysts agree that the biggest Brexit consequences would be felt by Ireland, the Netherlands, Belgium, Latvia, Malta, Cyprus and Luxembourg. Germany would also be affected, however, the effect would be lower than the listed countries.»

Illogical statements?

Furthermore, the ministry said the Standard & Poor’s rating features «illogical statements» in connection to Brexit effects on Lithuania’s exports, although Lithuania’s export-GDP ratio is at 2.5 per cent, as compared to 3.2 per cent in Estonia and 3.9 per cent in Latvia.

«Nevertheless, the countries are not listed as being exposed,» notes the release.

It also emphasizes that Lithuania was also «misleadingly listed» because of the remittances made by emigrants.

«Our preliminary calculations suggest they could total at about 300 million euro in 2015 or about 0.8 per cent of the GDP, which is considerably less than specified in the S&P analysis (1.2 per cent). Furthermore, if the Lithuanian citizens living in the UK were to move elsewhere because of Brexit, they would probably move to Ireland and Norway. This means that the remittances of those working abroad would continue flowing to Lithuanian households,» the Ministry of Finance said.

It also questioned the number of Lithuanian emigrants living in the UK published by S&P. According to the ministry, they total is 5.1 per cent, not 5.4 per cent, of the Lithuanian population.

Impact will be minimal

«So to wrap it up, the report is misleading facts-laden and it bids noting apocalyptic to the Lithuanian economy. Standard & Poor’s has, in fact, not asked us for any official data, thence the misleading conclusions,» says Algimantas Rimkūnas, the finance vice-minister.

In his words, the forecast on Brexit’s impact on Lithuanian economy is «minimal» and there will be no direct impact in short-term.

«It is not tangible and will not be such in the near future,» he underlined.

The US financial ratings company‘s report in June found Ireland as the country to be the most affected by Brexit aftershocks.

Then, with 20 EU countries’ migrant flows, exports to the UK, foreign direct investment here and financial sector claims on UK institutions analysed, Canada and Switzerland were the only non-EU countries included the index, which also featured Nordic countries and major European players such as France and Germany.

«Ireland in the forecast is to be hardest hit due to its shared history and common border with the UK, which has led to the significant trade and huge migration between the countries,» the June report read.

Lithuanian analysts baffled

«It is a sheer bullshit to claim that Lithuania, not any other European country and the United Kingdom first of all will be most ill-affected by aftermaths of Brexit,» Rimvydas Valatka, a renowned Lithuanian commentator, told BNN. «How can Lithuania’s economy be impacted so much if it, in its size, is no bigger that the Corwall County’s in the UK?»

He noted sardonically that S&P analysts may have been «overheated» in their heads when compiling the report.

The analyst also did not dare to speculate how the nomination of Theresa May to the post of the UK’s Prime Minister may affect the Brexit process.

«I reckon it will be in line with the EU laws outlining the mechanism. There is no simply other way,»he said.

Valatka called David Cameron «a downright idiot» who has been juggling the idea of UK referendum on the EU membership for the last couples of years.

«If not him, we would not have had the referendum and Brexit. The card of democracy has turned against him, ruining her political career,» Valatka said, adding, «There is always a possibility that some new idiots like him will pop up somewhere on the continent.»

New UK PM will have to turn ear to others

Lauras Bielinis, former advisor to President Valdas Adamkus and associate professor, downplayed the S&P report, saying that any other consultancy would have provided different results.

«I am sure that Poles, Latvians and any other Eastern Europeans have apprehensions that namely they are to be ill-affected by Brexit most,» he told BNN.

Asked about the arrival of Theresa May, Bielinis believes she will try to mitigate the adverse consequences of Brexit both within the United Kingdom and the European Union.

«But I am sure she will proceed with the procedures towards the country’s exit from the bloc,» he added.

Although the new PM was known as a staunch supporter of tough migration politics, Mrs. May will need to attune her position on emigration with the UK Parliament and the Queen, according to him.

«It might not be easy always. She will definitely have to turn ear to what they say,» he said.

Lithuania is not special in any way

Meanwhile, Vytautas Dumbliauskas, an analyst and associate professor, reasoned to BNN that Lithuania «in no way» is special or different in terms of the negative Brexit aftermaths.

«From that point of view, the Poles are the ones to feel the most palpable aftermaths of Brexit for a single reason: their UK community is the largest,» he said.

Mrs. May’s nomination, he believes, is the interference of «God himself».

«Look, when the United Kingdom is in trouble, a woman turns up at the helm of the country. You, sure, understand I have the legendary Margaret Thatcher in mind,» the analyst said.

Although the new PM is known for its tough stance on emigration, Dumbliauskas tends to disregard the concerns in the UK Lithuanian community.

«The country will do nothing without the foreign workforce, so she will have to deal with the reality,» he predicted.

New PM will have to listen to Queen

Vytautas Bruveris, a senior journalist at daily Lietuvos Rytas, says he is «sticking» with the position by the Lithuanian Finance Ministry, which says it will be «minimal.»

As for the new UK political leadership, he believes that the UK’s financial and political elite will be hammering out policies in the post-Brexit Great Britain.

«The new Prime Minister will definitely have to heed what they say,» Bruveris told BNN.

Ref: 111.111.111.3511


Leave a reply

Ten million euros to be allocated to assist with elder people employment

Central Finance and Contracting Agency has sent a proposal to the State Employment Agency to apply for European Social Fund financing to realize measures to maintain and improve elder people employment.

Latvia and China sign cooperation memorandum to develop aviation industry

Latvian Transport Minister Uldis Augulis and Administrator of Civil Aviation Agency of China Feng Zhenglin signed a cooperation memorandum on Friday, 23 September. This cooperation memorandum is meant to assist with the development of the aviation industry.

Number of counterfeit products confiscated by EU authorities continued to grow in 2015

According to the latest data published on Friday, 23 September, by the European Commission, EU customs authorities confiscated five million euros worth of more counterfeit products in 2015 than they did the year before.

Businessmen urge professionals to apply for SRS director general’s post

Latvian Chamber for Commerce and Industry invites professionals who fit requirements put up by the State Chancellery to take part in the personnel selection process for the post of director general of the State Revenue Service.

Dogo producer submits additions to court to launch case for slander

Tukuma Straume, manufacturer of Dogo dog food, has submitted documents to Riga City Vidzeme District Court to launch legal action against 17 private and legal persons for spreading untrue, partial and distorted information about the aforementioned product.

Meet «average candidate» for near Lithuanian parliamentary election

It‘s a race that has coalesced many of Lithuania’s heavy-hitters, political wannabes and simply better-life seekers for the same goal – clinching the coveted seat at Parliament.

Estonian presidential nominees feel need for stronger link with Russian community

Days before the decisive vote on the next Estonian President, most candidates have stressed the need for increased communication with the country's Russian-speaking population to establish a stronger link.

119 domestic pigs are put down in Gulbene due to ASF

African swine fever has been recorded in Gulbene municipality’s Ranka parish. Because of it, authorities had to put down 119 domestic pigs.

Burgh Group and Vitol to acquire shares of Richards Bay Coal Terminal

A consortium comprising Burgh Group Holdings and Vitol has agreed to acquire Optimum Coal Terminal Pty Ltd from the Tegeta Group for an undisclosed sum, subject to the relevant regulatory approvals and other conditions precedent.

Quarter of Latvia’s small and medium-sized companies struggle with financial difficulties

Only half of more than 60,000 companies in Latvia have a stable financial situation. 26% of small and medium-sized companies are currently struggling financially. In the next twelve months, they are expected to experience major financial difficulties, according to data from the Credit Information Bureau.

YouTube to encourage users to «snitch» on inappropriate content

Popular video sharing site YouTube has this week announced a scheme to offer rewards to users reporting on videos and comments, which they think are inappropriate to YouTube content guidelines.

Belgian police take 13 immigrants to France by accident

Two Belgian policemen have been handcuffed and questioned in northern France by their French counterparts after being caught with 13 illegal migrants banned from staying in Belgium.

Transit industry: this is the golden moment to decide the future of Latvia’s national economy

Although Latvian Association of Ports CEO Karlis Leiskalns praises the work of Riga Freeport, where he works as well, advisor to Latvia’s Foreign Affairs Minister Sandra Sondore and president of Baltic Association – Transit and Logistics Inga Antane emphasize the importance of all three of Latvia’s biggest ports for the growth of Latvia’s national Economy.

Coalition parties will not form a shared candidate list for elections in Riga

Parties of the ruling coalition – Unity, National Alliance and Union of Greens and Farmers – decided on Thursday, 22 September, to cooperate before and after municipal elections in Riga. They will not, however, form shared candidate lists.

Eesti Energia considers building another plant, if oil price rises

Estonian energy company Eesti Energia (Enefit) has this week spoken of plans to build another oil shale refinery plant in case the price of crude oil surpasses USD 60 (EUR 53) per barrel.

Poroshenko: Russia lies even more than Soviet leaders

President Petro Poroshenko of Ukraine has directed sharp criticism toward Russian foreign policies in Europe during his September 21 speech at the UN General Assembly.

Criminal liability will be applied for serving in foreign army or police force

To reduce possible security risks in relation to military service in third countries, Latvian citizens and non-citizens will be prohibited from serving in foreign armies, police and security institutions. Breach of this prohibition will carry criminal liability with a sentence of up to four years in prison.

Proposal to merge SRS Finance Police and Customs Police is declined

Finance Minister Dana Reizniece-Ozola intends to look for ways to ensure the merging of State Revenue Service’s Finance Police and Customs Police.

Saeima proposes reviewing options to secure free lunches in kindergartens

On Thursday, 22 September, the Saeima decided to ask Cross-Sectoral Coordination Centre’s cooperation platform Demographic Affairs centre to review the option of securing free catering in kindergartens.

Tougher abortion legislation pushed for in Poland

The Polish parliament is this week reviewing proposals backed by Poland’s Catholic Church to make the country’s abortion law even tougher.

Saeima to approve next year’s budget on 23 November

Latvia’s parliament plans to approve the final draft of the country’s budget for 2017 on 23 November, as agreed upon by members of Saeima’s Budget-Finance Committee on Wednesday, 21 September.

EU plan on lifting roaming charges altered

The European Commission this week has announced changes to the European Union’s plan to lift roaming surcharges to people, who use their mobile phones in another member state.

Criminal liability for service abroad and other decisions viewed by Saeima

To reduce possible security risks associated with service abroad, the Saeima on 22 September will conceptually decide on a prohibition for Latvian citizens and non-citizens to serve in armies, police and security institutions in third countries. This is provided by amendments to the National Security Law and Criminal Law.

VNT: Ventspils Freeport’s rule-development process is non-transparent

While Ventspils City Council and Ventspils Freeport Authority publicly express their common requirement for VNT to build and operate a vapour recovery unit, Ventspils Freeport Authority has been failing to issue technical regulations for construction of the VRU for nine months.

Riots in U.S. city followed by state of emergency

State of emergency has been announced in the U.S. city of Charlotte on September 21, where riots erupted after police killed a man.