Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure LT-2020-41/2974 – measures in Lithuania
|Country||Lithuania , applies nationwide|
|Time period||Open ended, started on 06 October 2020|
|Context||COVID-19, Restructuring Support Instruments|
|Type||Other initiatives or policies|
Supporting businesses to stay afloat
– Access to finance
|Author||Inga Blaziene (Lithuanian Centre for Social Sciences) and Eurofound|
|Measure added||03 November 2022 (updated 04 November 2022)|
On 6 October 2020, the State Aid Fund for Business (the Fund) was established in Lithuania at the initiative of the Bank of Lithuania (BL). The main objective of the Fund is to provide aid to large and medium-sized enterprises that face financial difficulties and to help ensure the sustainable performance of large and medium-sized companies and the vitality of the capital market. This measure helps the companies to ensure their liquidity and to recover faster from the COVID-19 crisis. The Fund invests in Lithuanian companies that are experiencing financial difficulties that pose a risk to the continuity of their operations.
The Fund provides aid to large and medium-sized businesses affected by the COVID-19 pandemic through loans and by investing in their debt securities, shares and hybrid instruments. Financial assistance is provided to companies that are unable to obtain the funding they need on the financial markets and thus face serious difficulties in continuing their activities. When providing support, the priority is given to companies that create innovations.
The main means of support offered by the Fund:
For any one company, loans and bonds may not exceed 25% of its 2019 turnover. Exceptions may be made and more financial aid provided for those companies most heavily affected by COVID-19. Interest rates are set considering the term of the investment, the lending risk and collateral quality, and other criteria.
The Lithuanian state, represented by the Ministry of Finance (MF), is the sole shareholder of the Fund. The State Investment Management Agency (VIVA) is responsible for managing the Fund.
According to the data provided by the VIVA, by 11 January 2022, the Fund has provided support of €157 million to 28 companies in the form of loans or investments in bonds. The support was mainly provided to hotels and manufacturing companies. According to the Manager of VIVA, the Fund plans to sign another €100 million in loan contracts by the beginning of summer 2022
|Does not apply to workers||
||Does not apply to citizens|
Public support service providers
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Not applicable||Not applicable|
Social partners' role in the implementation, monitoring and assessment phase:
No information available.
Representatives of the employers‘ organisations positively assessed the establishment of such a fund in Lithuania. According to the President of the Lithuanian Confederation of Industrialists (LCI), such a fund is very important and timely for Lithuania, as one can observe a consistent decrease in production volumes in the country since the start of the COVID-19 pandemic.
Eurofound (2022), The State Aid Fund for Business, measure LT-2020-41/2974 (measures in Lithuania), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/LT-2020-41_2974.html
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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.