Whichever way you look at it, Lithuania is a success story. GDP growth between 2003 and 2007 averaged 8.4% a year and the 3.1% increase in 2008 was among the highest in the EU27. The housing market has also grown considerably and property investment in this Baltic State has provided promising returns. In addition, this year sees a first for a new EU member state – Lithuania’s capital, Vilnius, is this year’s European Capital of Culture.

Having emerged from Soviet occupation in 1990, Lithuania, the largest and most populated Baltic State, is now a fully-fledged member of NATO and the EU. Its status as an established member of Europe is confirmed by Vilnius as European Capital of Culture. The capital’s old quarter, a treasure trove of Baroque architecture, is widely acclaimed as the greenest and most elegant of the three Baltic capitals. Not for nothing is Vilnius a UNESCO World Heritage Site.

As European Capital of Culture, Vilnius offers an impressive calendar of events –experimental theatre, opera, multimedia events, classical music concerts, ballet and films – which promise to attract numerous tourists to this Baltic capital. Highlights in the year’s many events include the Opera Festival, ‘Let There be Night’ on Midsummer’s Eve and European Jazz.

In common with many other EU countries, Lithuania’s outlook for 2009 is not quite so bright. Eurostat forecasts 0% GDP growth for this year, although this is considerably better than many of the EU’s larger and more developed states, and only fractionally below the growth forecast for the EU27 as a whole (0.2%). The prediction keeps Lithuania in the enviable position of being outside the recession zone.

Property prices have also seen a dip – the Knight Frank Global House Price Index for Q4 2008 reported a year-on-year fall of 1% on the previous quarter (again, significantly below the drop seen in other countries). However, a downturn in the property market often signifies opportunities for investment. “The fact that Vilnius will constantly be in the cultural spotlight this year will undoubtedly boost tourism and enhance the capital’s status as a popular weekend-break destination,” says James Gonzalez, Market Analyst at Obelisk Investment Property. “This year could well be the one when it’s worth looking into the Lithuanian market with opportunistic buying in mind.”