FATF Status

Lithuania is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Lithuania was undertaken in December 2023. According to that Evaluation, Lithuania was deemed Compliant for 8 and Largely Compliant for 28 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 1 of the Effectiveness & Technical Compliance ratings.

Corruption in Lithuania is perceived as less of a barrier to business, with a significant decline in reported corruption experiences among executives since 2019. While large foreign investors generally find the environment manageable, small and medium enterprises (SMEs) often face challenges from petty bureaucrats and excessive red tape, leading to complaints of extortion. Despite the establishment of the Special Investigation Service to combat corruption and the introduction of a new anti-corruption law in 2022, issues such as nepotism and high-level corruption persist, highlighting the need for improved enforcement and transparency.

Lithuania has a strategically positioned and diversified economy that has shown steady growth since the 2009 economic crisis, with a GDP growth of 5.1% in 2021 and a slight contraction in 2020 due to the COVID-19 pandemic. Despite challenges such as high inflation rates driven by the war in Ukraine, the economy continued to grow in 2022 and remained mostly flat in 2023. The country has a well-educated workforce and offers various investment opportunities across multiple sectors, with the United States being the largest foreign investor.

Lithuania presents a favorable investment climate characterized by a diversified economy, adherence to EU regulations, and a well-educated workforce. The government ensures equal treatment for foreign and domestic investors, offering various incentives, including tax concessions and support through Special Economic Zones. Despite some bureaucratic challenges and transportation barriers, Lithuania remains an attractive destination for investment, particularly in sectors like Information Technology, Biotech, and Real Estate.