Lithuania experienced a politically dynamic period, marked by parliamentary and presidential elections. A center-right coalition led by Prime Minister Ingrida Šimonytė governed until November 2024, after which a center-left coalition took office. Populist actors gained visibility, while the country’s pro-Western orientation and institutional stability were preserved. A municipal expenses scandal exposed shortcomings in transparency and accountability at the local level.
Economic performance remained robust despite external uncertainties. The economy continued to grow, public debt stayed low, and inflation declined sharply in 2024. Financial measures, including a windfall tax on banks, received broad parliamentary support. At the same time, structural challenges such as socioeconomic inequality and the risk of a middle-income trap persisted.
Governance was strongly shaped by security challenges related to Russia’s war against Ukraine. Defense spending increased significantly. President Gitanas Nausėda strengthened checks and balances by blocking partisan ministerial appointments. Investigations into the misuse of municipal funds led to legislative amendments and criminal proceedings.
