TRANSPORTATION BUSINESS OF LITHUANIA IS EXPERIENCING A MARKET FIASCO

The Lithuanian logistics services market is experiencing a period of acute crisis - many companies file for bankruptcy or close down amid the ongoing COVID-19 pandemic. According to statistics, 87 companies operating in the transport business area were closed during the quarantine period in Lithuania. This, in turn, leads to mass unemployment - more than a half of thousand employees have already lost their jobs.

The period of the coronavirus crisis turned out to be most difficult for the small businesses - the enterprises with less than 50 employees. Tomas Garouolis, representing the interests of the Lithuanian National Association of Road Carriers, notes that the number of small businesses is rapidly decreasing, and their employees are losing their jobs.

Large businesses, each employing over 600 specialists, are still afloat.

The closure of the border between Lithuania and Belarus, initiated by Alexander Lukashenko, played an important role in reduction of the freight traffic and the number of drivers. Experts note that although international flights did not fall under the ban, introduced by the Belarusian authorities, the restrictions imposed continue to bring losses.

Sending goods through the territory of other countries is becoming more expensive, despite the fact that it is still possible to move through the territory of Latvia, Estonia, Russia and Ukraine.

The number of drivers in Lithuania with a full social package has already decreased by 3,000 people.

Experts are inclined to believe that such dynamics could be the result of not only the pandemic factor, but also the influence of the tax environment. The debts of transport companies have quadrupled, and the transport market needs investments. Given that the industry missed about half a billion euro over the year for these purposes, there are concerns that companies will not receive the necessary income for a few more years.