EU Countries with Flat tax systemLithuania 24%

Latvia 25%

Estonia 22%

Slovakia 19%

Bulgaria(from 1 January) 10%

Romania 16%

POPULATION AND SIZE

POLAND

Population: 38.5 million (2008)

Area: 312,685 sq. km

BELARUS

Population: 9.685 mill.

(June 2008)

Area: 207,600 sq km

RUSSIA

Population: 142.2 mill. (2007)

Area: 17,075,200 sq km

LATVIA

Population: 2,271 mill.

Area: 64,589 sq km

ESTONIA

Population: 1,341 mill.

Area: 45,226 sq km

LITHUANIA

Population: 3,366 mill.

Area: 65,200 sq km

KALININGRAD OBLAST

Population: 947,000

Area: 15,100 sq km

INFLIATION

12.6% (Jan 2008)

11.3%*

17.9%*

12%*

2.5%(2007)

8.4% (2007 est)

9.3%(8/2007)

*LT, LV, EE – May 2008

UNEMPLOYMENT RATE

4.2%*

6.5%

4.9%5.9% (Jan. 2007)

12.8% (2007 est.)

1.7% (2007)

6.2%

*LT, LV, EE – Q1 2008

Average gross monthly earnings

788 EUR*

645 EUR

623 EUR

268 EUR

770 EUR (9/2007)

375 EUR

348 EUR

*Q1 2008 (LT, LV, EE)

(2007) in Euros

GDP GROWTH

7.1%

10.3%

8.8%11.2%*

*2006

Q1 2008 - EE 0.1%; LV 3.3%; LT 7%

6.5% (est.)

8.1%

8 %

GDP per Capita (2007 est.)*

$21,100

$17,400

$17,700

$14,700

$16,300

$10,900

*CIA- The World Factbook

Labour productivity per person employed (EU 25)

Real GDP Growth Rate (2006)

Expenditure on social protection as a percentage of GDP (2004)

Lithuania – Human Development Index

• Lithuania ranks at 43 in the United Nations Development Programme (UNDP) Human Development Index. Estonia ranks at 44 and Latvia ranks at 45.

• HDI - living a long and healthy life (measured by life expectancy), being educated (measured by adult literacy and enrolment at the primary, secondary and tertiary level) and having a decent standard of living (measured by purchasing power parity, PPP, income).

• At ranking 43 out of 177 countries – Lithuania is listed as - a ‘High Human Development Country’.

Total expenditure on social protection

Active Labour Market Policy % GDP (averages 1997 – 2004)

Index of Fatal Accidents at Work 1998-2005 (per 100,000 employees)

source: Eurostat

Fatal accidents at work Index of the number of fatal accidents at work per 100 thousand

persons in employment (1998=100)

Serious accidents at work 2005 Index 1998=100

Deaths due to suicide (SDR per 100,000) males

At risk of poverty after social transfers 2005

Tax rate on low wage earners: unemployment trap

Tax rate on low wage earners: couple with 2 children

Food and non-alcoholic beverages (% of household income expenditure) 2005

Inequality of income distribution (income quintile share ratio) 2005

Relation between income inequality and life expectancy

Source: HEALTH STATUS AND LIVING CONDITIONS IN AN ENLARGED EUROPE Report prepared by European Observatory on the Social Situation LOT 4: Health Status and Living Conditions Network for the DG Employment, Social Affairs, and Equal Opportunities, European Commission Final Report December 2005 p.64 http://ec.europa.eu/employment_social/social_situation/docs/sso2005_healthlc_report.pdf

Recent demographic developments in Europe 2004. Strasbourg: Council of Europe Publishing 2005

Male life expectancy at birth 2005

Net trade union density in EU25, 1995–2004 (%)Source: European Foundation, Industrial Relations in EU Member States 2000-2004 p.6.

Collective bargaining coverage in EU25, 2002 (%) Source: European Foundation, Industrial Relations in EU Member States 2000-2004 p.14.

Trade unionisation in the Baltic States

• Latvia –15% of workforce (EIRO report. 2005)

• Lithuania – 10% of the workforce (EIRO report, 2005)

• Estonia –9% of the workforce (LFS, 2006)

Density rate of employer organisations in EU25 (%) Source: European Foundation, Industrial Relations in EU Member States 2000-2004 p.12.

Average number of working days not worked due to strike action per 1,000 employees, EU25, 2000–2004

Source: European Foundation, Industrial Relations in EU Member States 2000-2004 p.23.

Did your employer provide cash-in-hand payments for overtime or other work in the last twelve months?

Migration – a crisis of human resources

Scale of labour outflow since EU accession in 2004

• Lithuania (3.3%) and Latvia (2.4%) registered outflow of working age population.

• In Slovakia, Poland and Estonia, the scale of outflow was somewhat smaller – about 1%

• LABOR MIGRATION FROM THE NEW EU MEMBER STATES: World Bank, EU8,Quarterly Economic Report, PART II: Special Topic, September 2006,World Bank Report p.22

Proportion of people who think that they are likely to move to another EU Member State in the next five years (percentages)

Quality of life % satisfied by

country source: EQL Survey

Standard of living

% satisfied by country

source: EQL Survey

‘Non-circular’ migration

Proposals of World Bank

• Governments would be well-advised to manage labor migration more proactively.

• Further measures are needed to stimulate labor force participation and employment, including reducing high labor taxes and in some cases social benefits.

• EU8 countries should also consider phasing in—in tandem with capacity development for screening needed labor—a more liberal regime for importing labor from countries further east.

The ‘Hard Landing’ scenario…