Region

Key advantages of the county

Highly developed infrastructure

Kaunas County is located at the intersection of Via Baltica, a European priority transport corridor connecting Helsinki, St. Petersburg and Warsaw and East-West motorway A1 linking Klaipeda Seaport to Russia and the Ukraine.

Excellent geographical location

The County’s centre, the city of Kaunas, is located at the confluence of two of the largest rivers of Lithuania and has always been a major city and a trading hub within the country.

Kaunas FEZ

Kaunas Free Economic Zone, located near the city of Kaunas and covering the area of about 10 sq. km, is aiming to attract FDI and new technologies and create new jobs.

Low – cost and qualified labour force

There are 8 universities and a number of colleges and vocational schools in the county providing a low-cost and highly qualified labor force for the local industries.

County profile

Kaunas County is the third largest region in the country. It is a geographical, educational, as well as an industrial and transportation centre of Lithuania.

The County comprises the city of Kaunas, the town of Birstonas, and the Districts of Kaunas, Kaisiadorys, Prienai, Birstonas, Raseiniai, Kedainiai and Jonava. The County covers the area of 8,170 km2, and its population numbers 754,000. 

Situated in the middle of the County at the confluence of the two largest Lithuanian rivers, the city of Kaunas has been considered one of the most important cities in the country's history. The Nemunas river, still used for navigation today, has historically contributed to the development of the city. The city is also located at the crossroads of the country's two major motorways: the A1 motorway Vilnius - Kaunas - Klaipeda is a connection between the capital city of Vilnius and the ice-free Klaipeda Seaport. The Via Baltica (road E67) leading from Estonia via Latvia to Poland will be integrated into the TransEuropean motorway system, serving as a connection between Nordic countries and Central and Western Europe.

Kaunas Free Economic Zone is  planned to become one of the largest free economic zones in the Baltic Sea Region. The plans include construction of a river harbour a mere two kilometres away from the territory of the Free Economic Zone.

Some Districts of the County, such as Jonava, Kedainiai and Kaunas, have been industrial centres for many years, with deep traditions in textile and fibre, electronics, chemical, wood processing and furniture industries.

Prienai District is famous for its aviation centre and the Experimental Aviation Sport Factory, while the town of Birstonas, situated on the spectacular banks of the Nemunas river, is a rehabilitation centre providing all kinds of sanatoria. The area is famous for its native mineral waters. In addition, the Region's recreational areas contribute to the development of the local industry.

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Local incentives

In Kaunas County the municipal incentives are available and apply to land lease and real estate taxes. The period depends on job created.

Kaunas District applies no land tax and real estate tax for companies or their branches registered in the District and those carrying out commercial activities in Linksmakalnis. The incentive is valid to December 31, 2004.

Kedainiai District applies no land tax for new job creators. The incentive is valid for the period required for building or for up to 3 years, depending on the number of jobs created.

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Foreign investors

In 2000, Kaunas County received more than 10% of all the FDI in the country, i. e. 261 mln. USD, and was the second Countie that received major investments (after Vilnius County that received 62,7%. The number of companies that have attracted FDI is increasing each year and in 2000 they numbered  aproximately 500.

The city of Kaunas attracts a major part of foreign investments in the County (82%). The largest investments (40 mln. USD) have been made in its light industry. Investment in the manufacture of food and beverages made up 24 mln. USD, chemical industry – 11 mln. USD, metal constructions – 5,5 mln. USD and electric and optical appliances – 2 mln. USD.

The largest multinational investors that can attest to their satisfaction of the choice of Kaunas as their locale, include: Kraft Foods International (USA), Richard Hammerle Farberei and Appertur Gesellschaft (Austria), Chargeur Company (France), Calwer Decken und Tuchfabriken (Germany), Motorola (USA), Statoil (Norway), Shell (Great Britain/Netherlands), Neste (Finland), Siemens (Germany). The last big investment in the city of Kaunas was made into textile company “Liteksas ir Calw” by the Italian giant of textile industry Marzotto. The Italian company asquired 84% of the company’s stock and has plans to make an investment of 10 mln. USD in the nearest future.

In Kedainiai District in 1997 the Finnish company “Kemira” invested 5 mln. USD into the local manufacturer of phosphorus fertilizers “Lifosa” and the US-based company Cargil Inc. has invested 15 mln.USD in “Lifosa” operations.  “Lifosa” is the nation’s seventh largest company in terms of sales.

In Prienai District most FDI have been invested in the local companies manufacturing clothes.

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Local industry

The County’s industry output makes up 20% of the national industry output and 25% of the country’’s industry employees are employed in Kaunas County.

Kaunas has long-standing traditions as the centre for textile and fibre, electronics and wood processing and furniture industries, and for production of medical, optical and precision instruments, foods, and chemicals.

Such industries as production of machines and instruments, metal processing, chemical, building materials, textile and knitwear, paper and printing, furniture, glass and food industries are well developed in the Region.

In the city of Kaunas, light industry (mostly textile) makes up 36% of the production sector, while machine building constitutes 22%, food processing 17%, chemical industry 6%, and wood and paper 5%. Textile, construction, food products and beverages industries operated mainly by private or small companies generate good profits. The export of ready-made clothes, furs and footwear makes up 85%, chemical industry 63%, manufacture of telecommunication equipment 42%. The traditional industry in the city of Kaunas - electronics - is currently in the process of privatisation and transformation towards Western market oriented production. Most of the big companies in the machine building sector are either state owned or in the process of privatisation.

In Kedainiai District, the manufacturing of chemical products, mostly fertilizers, constitutes the main part of the local industry. In 1999, the sales in the chemical industry in the District reached 141 mln USD, and 85% of the production was marketed in Western Europe, the USA and Asia.

Prienai District is notable for a number of foreign companies that have invested into the local companies producing ready-made clothes to foreign orders. The companies employ over 800 workers of the local population, and their sales in 1999 equalled 11 mln USD.

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Key industries of the county

 

Textiles, clothing, footwear, furs and dyeing	Sales: 186,8 mln. USD, export – 85%
Non-metallic mineral products	Sales: 21,1 mln. USD, export – 7%
Metals and metal construction	Sales: 31 mln. USD, export – 24%
Food and beverages	Sales: 117,2 mln. USD, export – 18%
Wood production and furniture	Sales: 28,2 mln. USD, export – 32%
Chemicals	Sales: 64,8 mln. USD, export – 63%
Medical, optical and precision tools and locks	Sales: 20,3 mln. USD, expoert – 20%
Electric equipment and tools	Sales: 1,4 mln. USD, export – 40%
Publishing	Sales: 19,7 mln. USD, export – 1%
Cellulose, paper and paper items	Sales: 47 mln. USD, export – 32%
Resin and plastics	Sales: 9,2 mln. USD, export – 13%
Radio, TV and communication equipment	Sales: 4,5 mln. USD, export – 42%
Machinery production	Sales: 14,8 mln. USD, export – 19%

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