| Abstract [eng] |
Foreign direct investment is the measure generating economic growth, because entering of foreign companies into the market makes a significant contribution to value added of the country as not only new enterprises are founded, plants or factories are built, but also new work places with salaries higher than usual are created, as well as it improves infrastructure, brings new technologies and skills. However, although it might seem that this investment has exclusively positive impact but there can be certain cases when high flows of foreign direct investment may imply disguised purposes to eliminate competitors by acquiring or driving them out of the market, as well as that increases dependency of the state on foreign investors, which may not be willing to shear their technologies and created benefits. Object of the research: foreign direct investment and its impact of Lithuanian economics. Goal of the research: estimation of the impact of foreign direct investment on Lithuanian economics. Tasks of the research: 1. Discussing the issue and dynamics of foreign direct investment in Lithuania; 2. Showing theoretical aspects of foreign direct investment and its impact; 3. Defining the course of the research of the impact of FDI attracted by Lithuania and Lithuanian direct investment abroad on Lithuanian economics; 4. Assessing the impact of foreign direct investment attracted by Lithuania on Lithuanian economics; 5. Assessing the impact of Lithuanian direct investment abroad on Lithuanian economics. 6. Assessing the relationship between Lithuanian competitiveness and attracted foreign direct investments. Results of the research. The research of the impact of foreign direct investment on Lithuanian economics has shown that foreign direct investment attracted by Lithuania has a significant linear relation with the average gross salary in the economy of the country, import, export and GDP. Estimation of the dependence of all these variables and their correlation strength has indicated that 86.9% of Lithuanian export is conditioned by foreign direct investment. This significant impact on export can be explained by the fact that most part of investments attracted to Lithuania is directed to the sector of production; therefore, growth of this segment also determines an increase in exports. Analysing of the impact of Lithuanian direct investment abroad has shown that has a significant linear relation with the average gross salary in the economy of the country, import, export, GDP and inflation. When assessing all these variables, the highest dependence was established among direct investment abroad and export and GDP. The impact of direct investment abroad on Lithuanian export amounts to 84.1%, while on GDP – to 83.2%. Such an influence of direct investment abroad on Lithuanian export and GDP can be explained by the fact that involvement of Lithuania in foreign countries and markets is especially significant due to different reasons such as development of production and growth of export, import and price decrease, increase in salary and purchasing power what influence the whole Lithuanian economics. Regardless of FDI impact on Lithuanian economics, it has been established that Lithuania is not a competitive country attracting investment, because it is approximately in place 40th among the countries involved in the research of the competitiveness of countries around the world. The main shortfalls of Lithuania is a small size of the country what means a small market of consumers and lack of them as well as poor business and institutional environment what mostly frightens investors. However, Lithuania is a strong country because of its geographical position and consolidation of Scandinavian countries and their business in Lithuania; therefore, the interest of foreign countries in Lithuania might be higher if Lithuania managed to change different policies restricting investment and business. |
