Danas Vaitkevicius, commercial attache of the Lithuanian embassy in Beijing, says his main task is to introduce his country to China. Zhao Yanrong / China Daily

Baltic state offers Chinese partners fast route into europe and a thriving high-tech market

Next month sees the 21st anniversary of the establishment of bilateral relations between China and Lithuania, and it will come with wishes for a healthy growth in trade between the two countries.

When Chinese companies are reaching out for a bigger world market, Lithuania, the European Union's prime transport center on the Baltic Sea, is ready and willing to link them to the European market at least.

"Taking Lithuania as a bridge to enter the EU market, especially Eastern Europe, benefits both China and Lithuania," says Danas Vaitkevicius, commercial attache and head of the commercial section of the Lithuanian embassy in Beijing.

This was the road taken earlier this year by GRG Banking Equipment Co Ltd, China's largest ATM producer, which has 23.3 percent of the Chinese market share, and is one of the top 10 companies in the ATM industry around the world. The company established its European branch in March in Vilnius, the capital of Lithuania.

The company says the Vilnius office will serve as GRG's springboard for expansion in Europe. The new Lithuania-based subsidiary will provide equipment maintenance and ensure service quality control throughout Europe.

The company plans to build a team of 50 people, including sales managers, project managers, engineers and technical support specialists, within a few years.

"Knowledge of regional languages, markets and culture is important to the success of a sales office, and Lithuania has a great talent pool for this kind of work," says Pranas Griskevicius, regional sales director at GRG.

According to Eurostat, imports and exports between the two countries in 2011 amounted to $710 million (576 million euros), an increase of 16.7 percent on the previous year. Lithuania's exports to China reached $80.73 million, a 118.4 percent year-on-year growth, representing 0.3 percent of Lithuania's total exports.

China is ranked 30th in Lithuania's export market, and 13th in its imports. Compared with China's trade volume with the EU as a whole, Lithuania does not have a significant market share.

About 136.2 billion euros of EU goods were exported to China last year, while 292.5 billion euros of Chinese products were imported by the EU. China is now the EU's second-largest trading partner behind the United States, and the EU's biggest source of imports by far. The EU is also China's biggest trading partner.

"The business cooperation between China and Lithuania is just at a very early stage. We know little about China, and China knows little about us. Introducing my country to China, and understanding China better are the main tasks for us today," Vaitkevicius says.

To improve bilateral understanding and seek more opportunities for business cooperation, exchange visits are important.

This year, business delegations from Heilongjiang and Shandong provinces visited Lithuania, and a couple of months later, Lithuanian companies made trips to Heilongjiang.

Vaitkevicius is happy to see more business representatives from China go to Lithuania.

"Because about 90 percent of high-tech companies in Lithuania are small and medium-sized enterprises, they need to build a reliable partnership by in-person communications," he says.

Lithuanian businesses have become familiar with the Chinese market through exchange visits, and are finding it is different to what they thought.

"Some Lithuanian businessmen believed that only mega cities like Shanghai and Beijing are available for international cooperation, but when they were visiting China, they felt at home in other places as well, such as in Heilongjiang province," Vaitkevicius says.

Total foreign direct investment into Lithuania in 2011 was 1.5 times higher than in 2010, according to Statistics Lithuania and the Bank of Lithuania. It amounted to 3 billion litai ($1.07 billion, 868 million euros), a 54 percent year-on-year increase, contributing 2.8 percent of Lithuanian GDP in 2011.

Vaitkevicius suggests more Chinese companies should follow GRG's strategy and take advantage of his country's technology, geography and human resources.

There are 2,000 routes from Lithuania accessing 40 countries. Two of them are designated by the EU's Transportation Commission as among the 10 most important routes in Europe: the north-south highway and the rail route connecting Scandinavia with Central Europe.

Klaipeda, the only ice-free port on the eastern shore of the Baltic, is a regional transport hub connecting sea, land and railway routes from the East to the West.

The seaport handles roughly 7,000 ships and 30 million metric tons of cargo every year, and accepts large tonnage vessels.

"The cost of deploying a technical support specialist from Vilnius to another European city is quite small, and the entire continent is accessible within two or three hours from Lithuania," says Griskevicius of GRG Banking.

"In Germany, it can take that long just to get from one point to another in the same city."

Lithuanians are also the most multilingual people in Central and Eastern Europe. About 90 percent of local people speak a foreign language, and half the population speaks two, including Chinese in many cases, Vaitkevicius adds.

Currently, more than 90 percent of the Lithuanian population has a higher education background, one of the highest among the 27 EU members.

Lithuania also claims to have the fastest Internet speeds in the world.

According to a World Bank report "Doing Business 2010: Reforming through Difficult Times" Lithuania is ranked 26th out of 183 economies on the ease of doing business, and outpaces its neighbors Latvia, Slovakia, Slovenia, Poland and Russia.

"Lithuania's strong advantages are the higher and professional education system, technological market base, as well as infrastructure," the report states.

zhaoyanrong@chinadaily.com.cn

(China Daily 08/17/2012 page20)