Lithuania getting to know China

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, 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 ($168.22 billion) 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.