Traditionally an agrarian land, Lithuania became extensively industrialized as a result of Soviet programs in the 1960s. By 1989 it had a labor force of 1,853,000. Forty percent of workers are employed in industry and 20 percent in agriculture and forestry.
During the nineteenth century, industrialization was hampered by a shortage of natural resources and absence of good port facilities. Much of the land was held in large estates given to the raising of grain, flax, and horses. Much of what industry had developed was destroyed during World War I. During the period of independence between the world wars, the government emphasized the production of high-quality meats, dairy products, and eggs, and it pursued a vigorous program of land reform that resulted in greater productivity. This emphasis on animal husbandry in agriculture remains today.
The imposition of Soviet rule, which led to guerrilla warfare against the Soviets and forced collectivization of the farms, caused a marked decline in agricultural productivity that lasted until 1955. Prior to Lithuanian independence in 1991, there were approximately 310 state and 740 collective farms. Farm production today is geared toward raising pigs and dairy cattle; half of the crops raised are for fodder. Lithuanian farms also produce significant quantities of flax, sugar beets, potatoes, and vegetables. In recent decades, farms have been expanded through land reclamation and swamp drainage. Most of the country's farming is done in the northern and southern regions.
Following the establishment of Soviet control, and especially during the 1960s and after, industrial production grew rapidly. Lithuania produces electricity from several plants, including a hydroelectric and a nuclear plant. It makes ships, machine tools, chemicals, building materials, petroleum products, cement, welding equipment, plastics and synthetic fibers, chemical fertilizers, cotton cloth, knitted garments, and electronic devices. Lithuanian factories also process meat, fish, sugar, and butter. In addition, there is significant light industry, including metalworking and woodworking, and Lithuania boasts several large resorts. Most of Lithuania's shipbuilding and fish processing is done in the west, metalworking and light industry are primarily concentrated in the east, and most of the hydroelectric generation and food processing is done in the south. There is a Chernobyl-type nuclear reactor in Ignalina in the north, which presents a great danger to the entire region.
Eighty percent of Lithuania's trade is with countries belonging to the Commonwealth of Independent States. Other important trading partners are Germany, Great Britain, Denmark, Belgium, Poland, Cuba, the Czech Republic, Slovakia, and Italy. Goods transported by ship usually go through the port of Klaipeda, and Vilnius has the major airport, but most of the country's goods move by rail.