The Ministry of Finance and the Association of Local Authorities in Lithuania signed a memorandum on strengthening the investment potential of municipalities
During the Regional Forum held at the Presidential Palace, the Ministry of Finance and the Association of Local Authorities in Lithuania signed a memorandum of cooperation, agreeing to work together to find solutions to increase the investment potential of municipalities and to promote cooperation between municipalities in implementing joint investment projects.
"Strong regions are inconceivable without sustainable investment. By signing this memorandum, we aim to work with local governments to find solutions that boost their investment potential while maintaining responsible public finance management and fiscal discipline. It is equally important to encourage municipalities to cooperate on projects that benefit not just one, but several municipalities and their residents," Minister of Finance Taurimas Valys says.
The memorandum commits to seeking solutions compatible with general government fiscal discipline rules that would enable municipalities to invest more effectively in infrastructure important to residents, public services, and regional development.
The memorandum will also aim to promote joint investment projects that create economic and social benefits for several municipalities at once. Such cooperation is expected to lead to a more efficient use of available resources, to the benefits of economies of scale and to investments with a greater impact on regional development.
"Increased inter-municipal cooperation could be driven by clear economic benefits, more efficient use of resources and the possibility of pooling competences in larger-scale projects. Therefore, we will seek to identify successful examples of cooperation and assess measures that would encourage municipalities to act more often together," the Minister of Finance states.
In recent years, ILTE, the national development bank, has become an important investment partner for municipalities, financing education, culture, sports and infrastructure projects. This confirms the need for municipalities to mobilise additional sources of funding and provides a basis for focusing more on joint projects implemented by several municipalities in the future. The assessment of possible stimulus measures will also take into account fiscal discipline requirements and the need to ensure sustainable management of general government finances.
According to Minister of Finance T. Valys, the objectives of the memorandum also relate to broader discussions on the role of regions in the planning of the new European Union investment period post-2027 – Lithuania aims to empower municipalities to make their own decisions on regional development and investment priorities.
"Local communities and municipal authorities know best what investments they need. We aim for regions to have greater autonomy in the future and for investments to yield tangible results—such as new jobs, a better quality of life, higher employment rates, or other long-term social and economic returns", T. Valys notes.
In implementing this memorandum, the Ministry of Finance and the Association of Local Authorities in Lithuania will mobilize experts to identify potential joint municipal projects and assess their feasibility, as well as the direction and scope of investments. It has been agreed that concrete proposals will be submitted to the President, the Speaker of the Seimas, and the Prime Minister by 1 July 2027.
Last updated: 06-10-2026