OREANDA-NEWS. June 04, 2015. Lithuania’s sustainable economic policy drove the growth of the balanced economy, even under adverse external conditions, while efficient supervision of the financial sector strengthened the financial sector’s stability — this was noted by the International Monetary Fund’s (IMF) Executive Board, which on 28 May ended its annual consultations with Lithuania under Article IV of the Articles of Agreement of the IMF.

The IMF indicates that the banking system in Lithuania is well capitalised, liquid and sufficiently profitable. Having joined the euro area, Lithuania became part of the European Banking Union and joined the Single Supervisory Mechanism; therefore, the banking sector’s supervision strengthened even more. Also the IMF positively assessed the Bank of Lithuania’s efforts to as soon as possible deal with the issues of the credit unions and plans to overhaul the credit union sector.

The IMF notes that having successfully adopted the euro in 2015 Lithuania stepped into a new era of economic convergence. Seeking the Western European standard of living, Lithuania in the future will pay particular attention to structural reforms that lead to innovations and increase of productivity as well as dealing with the issue of demographics.

In analysing the public sector’s finances, the IMF stresses that Lithuania has already gone down the long and successful road of fiscal consolidation. However, further consolidation of the public sector finances and structural reforms are necessary; they would improve the quality of the budget’s expenditure and increase the efficiency of taxes.