Lithuanian companies which export a significant share of their wares the United States are saying that it will be hard to find alternative markets in the wake of a 20% tariff on goods from the EU that has been implemented by the United States.
“We will certainly not close down,” promises Mindaugas Bondauskis, CEO of Litnaglis, a nail manufacturing company in Plunge. Speaking to LRT public radio on Wednesday, he noted that “we have the EU market, we have other markets, but our volumes will drop, our employee numbers will decrease, and it will be hard for any company to switch to other markets just for a while. Our hope is that the European Union will impose some kinds of tariffs itself, and if the EU protects us, we will stay in it.”
Litnaglis exported around 70% of its output to the United States last year at a value of EUR 61 million (EUR 55 million at today’s rate).
Bondauskis says that the company already pays a 25% tariff on steel and aluminium imports which came into force in March. In terms of products exported in December, the company has already paid more than USD 1 million.
Ekspla manufactures lasers, and its CEO, Aldas Juronis, says that 20-30% of revenues come from exports to the United States. He adds that efforts will be made to expand other export markets, though there is truly not much room for diversification.
“It’s hard to make up for a fifth to a third of potential revenues by finding a market in which we are currently not operating,” Juronis told LRT radio.
Asked whether it has been worth exporting to the US in the wake of the tariffs, the CEO said that it is necessary to honour long-term contracts with clients.
A new wave of US tariffs on dozens of trading partners came into force on Wednesday, and EU goods entering the US will be subject to a 20% tariff.
Lithuania’s Ministry for Economics and Innovation estimates that the new tariffs will cut GDP growth in Lithuania by 0.65% during the next three of four years.
Lithuanian direct exports to the US amount to around 6.8% of total exports, and last year exports to America were valued at EUR 1.6 billion.
Source: BNS
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