This document provides an overview of manufacturing and engineering in Lithuania. Some key points: - Lithuania has experienced strong GDP growth in recent years and has a young, skilled workforce. Manufacturing accounts for 20% of GDP. - The largest sectors for foreign direct investment projects are manufacturing, business services, and IT. The top investing countries are the US, Sweden, Norway, and the UK. - Lithuania has a number of international manufacturing companies with plants in sectors such as automotive, electronics, food, and furniture. The engineering industry is also strong, growing over 64% in the last 5 years. - Lithuania offers competitive advantages for foreign investment including a business-friendly tax and regulatory environment, EU

1. LET’S TALK LITHUANIA.
Justinas Pagirys
2015
MANUFACTURING

2. #1 For GDP/Capita
growth in EU3
Population1 2.98 mln
Labour Pool2 1.5 mln
Capital Vilnius
Official language Lithuanian
Dominant foreign
languages
English, Russian,
German, Polish
Real GDP growth1
3.0% (2015)*
2.9% (2014)
3.3% (2013)
3.8% (2012)
6.1% (2011)
Source 4: Heritage Foundation, Economic Freedom Index, 2015
Source 5: World Bank Doing Business Report, 2015
* Forecast (European Commission)
Source 1: Statistics Lithuania, 2015
Source 1: Statistics Lithuania, 2014
Source 3: Eurostat, 2004-2013
Facts & Figures
#15Freest economy
in the world4
#11For ease of
starting business5
2
Let’s talk Lithuania

3. 31%
15%
13%
12%
9%
20%
FDI PROJECTS BY ACTIVITY1 / 2010-2014
Manufacturing
Business Services
IT
Shared Services
Centre
Sales, Marketing &
Support
Other
FDI Projects overview
Source 1: The Financial Times FDI monitoring database and Invest
Lithuania data
13%
10%
9%
9%
8%7%
7%
37%
TOP INVESTING COUNTRIES
BY NUMBER OF PROJECTS1 / 2010-2014
United States
Sweden
Norway
UK
Finland
Denmark
Germany
Other
3
Let’s talk Lithuania

4. Manufacturing
FDI in Lithuanian Manufacturing industry, 2014
Source: Invest Lithuania
FDI trends in 2014:
 Total of 20 manufacturing projects in 2014
 New/expansion ratio (%) - 45/55
 Leading industries: Automotive / Trucks (4 projects),
Oil & Gas (3 projects) and Furniture (3 projects)
 65% of manufacturing projects settled in Kaunas or
Klaipeda counties
 More than half of the projects originates from
Scandinavia: Sweden (5), Norway (3), Finland (3)
 Average size of the typical project:
 40 FTEs
 Engineering skillset
 € 4 M CAPEX
35%
15%15%
5%
5%
5%
20%
Manufacturing project structure by
sector, 2014
Metal Products
Electronics
Food, Beverages & Tobacco
Industrial Machinery,
Equipment & Tools
Plastics & Rubber
Furniture
Other

5. A
MANUFACTURING IN LITHUANIA

6. #2 International Manufacturing Presence in Lithuania
Manufacturing plant
Products: pet food
Headcount: 800
Established: 1993 / Klaipeda region
6
Let’s talk Lithuania
Products: automotive wiring harnesses
Headcount: 700+
Established: 2002 / Klaipeda
Products: wiring systems
Headcount: 1000+
Established: 2014 / Panevezys
Products: iso-thermal trucks, trailers and semi-trailers
Headcount: 330+
Established: 1999 / Panevezys
Products: electronic circuit boards
Headcount: 400
Established: 1993 / Kaunas
Products: Tobacco
Headcount: 430
Established: 1993 / Klaipeda
Manufacturing plant
Manufacturing plant
Manufacturing plant
Manufacturing plant
Manufacturing plant

7. #2 Manufacturing Sector Overview
Source 1: Statistics Lithuania, 2012
Source 2: The Financial Times FDI monitoring database, 2014 and
Invest Lithuania data
Source 3: Statistics Lithuania; structure by value of industrial
production; excluding manufacture of coke and petroleum products
Source 4: Statistics Lithuania, 2014; production of Lithuanian origin;
excluding manufacture of coke and petroleum products 7
Let’s talk Lithuania
 Turnover of foreign controlled manufacturing
companies doubled since 20091
 20% of Lithuania’s GDP is generated by
manufacturing sector1
 >67% of all manufacturing production is exported
mainly to4:
#1 Germany
#2 Sweden
#3 Poland
#4 Latvia
#5 United Kingdom
30%
20%18%
16%
7%
9%
MANUFACTURING STRUCTURE / 20133
Food, Beverages & Tobacco
Engineering Goods
Furniture, Wood & Paper
Chmicals & Pharmaceuticals
Textiles and Leather
Other
16%
13%
10%
10%8%
43%
TOP COUNTRIES INVESTING IN MANUFACTURING
2010-20142
Sweden
Norway
Finland
Germany
United States
Other

8. B
ENGINEERING IN LITHUANIA

9. Engineering Sector Overview
Source 1: Statistics Lithuania, 2013
Source 2: Statistics Lithuania, 2012
9
Let’s talk Lithuania
 > 64% growth observed in engineering industry
over the last 5 years1
 >70% of engineering production is exported
mainly to: Germany, Sweden, Norway, UK, Poland,
Russia, Denmark 1
 ~ 130 foreign capital companies2
GLOBAL CUSTOMERS OF ENGINEERING COMPANIES:
30%
19%
14%
12%
8%
7%
6% 4%
STRUCTURE OF ENGINEERING INDUSTRY1
Rubber & Plastics
Fabricated Metal
Products
Machinery & Equipment
Electrical Equipment
Computer, Electronics &
Optical Products
Motor Vehicles
Other Transport
Equipment
Basic Metals

10. International Engineering Presence in Lithuania
Products: switches & other electronics
Headcount: 120
Established: 2008 / Klaipeda
10
Let’s talk Lithuania
Products: metal processing services
Headcount: 330
Established: 2006 / Siauliai
Products: automotive parts
Headcount: ~250
Established: 2003 / Ukmerge
Products: iso-thermal trucks, trailers and semi-trailers
Headcount: 330
Established: 1999 / Panevezys
Products: electronic circuit boards
Headcount: ~400
Established: 1993 / Kaunas
Products: forged and machined parts
Headcount: 170
Established: 2007 / Marijampole

11. Business
friendly
environment
4Cost &
quality
combined
32Fast to
connect
infrastructure
Young
competence
& talent
C
1 Perfect
living pace
5
LITHUANIA’S QUALITIES

12. #1 Young competence & talent
Source 1: Eurostat, 2013
Source 2: Eurostat, 2013 (age group 25-64)
Source 3: Eurostat, 2011 (age group 20-29)
Source 4: Eurostat, 2011 (age group 25-29) 12
Lithuania’s qualities
Top 5 in the EU with the highest
ratio of young people1
Ambitious young professionals
 #1 in the EU or 93% of our population have
higher or secondary education2
 #1 in the EU for mathematics, science and
technology graduates per capita3
 18% of Lithuania’s young professionals specializes
in engineering, manufacturing and construction
(x2 EU average) 4

13. Engineering graduates
 69% of population aged 18-35 would like to work
for an international company2
 3-4% attrition rate at manufacturing companies3
 7,700 engineering graduates anually4
Language
 80% proficiency in English among young
professionals5
 50% speak at least 2 foreign languages6
 Main languages: English, Russian, German,
Polish, Scandinavian and Romanic languages
#1 Young competence & talent
Source 1: Ministry of Education and Science, 2014-2015
Source 2: If annual survey, 2012
Source 3: Alliance for Recruitment, HR Agency, 2013
Source 4: Eurostat, 2011
Source 5: National Census, 2011
Source 6: Europeans and their languages, 2012
13
Lithuania’s qualities
39%
24%
14%
13%
10%
ENGINEERING STUDENTS’ STRUCTURE BY
MAJOR FIELDS
Transport Engineering
Electronics & Automatics
Mechanics and Metal
Works
Energy & Electricity
Other

14. Products:  Thermo-insulating panels
 Isothermal transportation
equipment: insulated trucks,
trailers and semi-trailers
Employees: 330+
Est.: 1999, Panevezys
Lithuania:
Schmitz
Cargobull
14

15. #2 Fast to connect infrastructure - logistics
Source 1: World Economic Forum, Global Competitiveness Report, 2014
Source 2: European commission, 2012
Source 3: www.portofklaipeda.lt
Source 4: Girteka Logistics, 2014. Estimates based on two-driver
shared shift model
1st in the CEE for quality of roads1
Road & Rail:
 25,800 truck fleet in Lithuania in comparison with Germany:
308,078, Denmark: 21,038, Sweden: 15,2482
 Rail cargo services direct to Russia, Belarus, Latvia, Poland,
Germany, Ukraine and Asia (incl. China)
Air:
 4 International Airports, access to major European cities
and Moscow within 2-3 hours flight
Sea:
 Klaipeda State ice-free Seaport
 14.5 m deep port, handling up to 60 mln tons of cargo annually,
the largest port in the Baltic States3
15
Lithuania’s qualities
4

16. 2,5%
#3 Cost & quality combined
Source 1: National Statistics Departments, 2013
Source 2: European Commission, European Economic Forecast, Spring 2014
Source 3: Grafton Recruitment, CEE Salary Survey, 2013/2014
average real wage growth for
2014-20152
16
Lithuania’s qualities
Position
Monthly Gross Salary3
Starting from +
EUR
Plant Supervisor 3.765+
Project Manager 1.130+
Quality Engineer 941+
Manufacturing
Engineer
941+
Production
Operative
565+
Machine operator 452+
5.288
5.251
4.596
3.538
3.529
3.449
2.702
1.598
1.048
967
949
924
824
777
716
646
507
413
AVERAGE MONTHLY GROSS WAGES (EUR), 20131
x8.2
more than
Lithuania
x5.3
x2.5
x1

17. #4 Business friendly environment
Source 1: Ministry of Finance of the Republic of Lithuania
Source 2: Sorainen Tax Card 2014
17
Lithuania’s qualities
LT LV PL DE SE
Corporate
profit tax
0 - 15% 15% 19% < 33% 22%
VAT 21% 21% 23% 19% 25%
Dividends 0-15% 0% 0-19% 0-25% 0-30%
Personal
income
tax
15% 24% < 32% < 45% < 57%
Social
security
tax
9%
employee
30.98%
employer
10.5%
employee
23.59%
employer
Total
35%
Total
~40%
7%
employee
< 31.42%
employer

18. #4 Business friendly environment – tax free zones
* Conditions apply
7 Free Economic Zones (FEZ):
 0% corporate tax for the first 6 years*
 50% discount on corporate tax over the next 10
years*
 0% tax on dividends*
 0% tax on real estate*
Industrial Parks (IP)
6-12 months delivery of build-to-suit
manufacturing facilities
18
Lithuania’s qualities

19. #4 Business friendly environment – financial incentives
Source 1: Invest Lithuania
Source 2: Ministry of Economy of the republic of Lithuania
Source 3: JSC “Investicijų ir verslo garantijos”
Source 4: Lithuanian Labour Exchange
 Lithuania’s Government1:
Up to 25% of investment to long-term fixed assets
or job creation
Taxation treaties with 50 countries2
Corporate profit tax incentives for R&D - fully
deductible expenses x32
Investment projects: corporate profit tax can be
reduced up to 50%2
 European Union2:
Up to 50% of R&D activities
Up to 50% of employee training
 Additional:
Up to 23.3% of youth employment costs3
Up to EUR 600 per month reimbursed for
employment of unemployed4
19
Lithuania’s qualities

20. Perfect living pace
Source 1: European Cities and Regions of the Future 2014/15
Source 2: The New York Times, 2011
Easy access to Europe
 Regular flights to all major European destinations,
with flight-times of only 2-3 hours.
Cost of living:
 According to the Mercer Cost of Living Index 2014,
Vilnius is one of the five least expensive EU
capitals to live in for expatriates.1
Lifestyle:
 Vilnius is ranked by the New York Times alongside
Copenhagen, Barcelona and Capetown as a hip
and well managed place to live.2
20
Lithuania’s qualities

21. We are a government agency that provides
free investment advice, contacts and data.
Let’s talk if you need someone to:
INFORM you on business costs, labour, tax & legal settings and
other business areas.
CONNECT you to partners and organize your business meetings
in Lithuania.
FACILITATE the set up and launch of your company, access
the government financial support and a range of training schemes.
SUPPORT your investment by lobbying for more business
friendly laws and assisting in one-off problems.
21

22. Justinas Pagirys
Business Development Director
T: +370 5 262 7438
E: justinas.pagirys@investlithuania.com
www.investlithuania.com
22
Thank you!